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Here are 12 tips to get out of debt:
1. Stop using your credit cards. Pay cash for all purchases until you pay off all of your debt.
2. Downgrade or downsize. Move into a smaller and less expensive home or apartment. Trade in your luxury car for a car with no note or a cheaper car payment.
3. Compare. Comparison shop before making a purchase to get the best deal. Use sites like bizrate.com or pricegrabber.com to find bargains.
4. Insurance. Buy insurance for health, life, disability insurance. Buy bundled services to save money with the same company and ask about discounts.
5. Setup a debt payment plan with your creditors. Setup
a debt payoff plan to prioritize your bills. By using the debt snowball method you will be able to quickly pay off some of your debts. Start by paying off the smallest bills first, then use the money paid towards a previous bill and apply it to the next bill and continue this process until all your debts are paid.
6. Sell Items. Sell items not used within the past 3 months or more on eBay.
7. Get current on late payments. Pay off collection accounts, tax liens and judgments as soon as possible.
8. Pay on time. Pay balance in full each month prior to the due date or as soon as you receive the bill which helps to avoid paying finance charges.
9. Negotiate. Contact the companies to negotiate a lower interest rate, get fees waived or change terms if your account is in good standing.
10. Pay more than minimum. If pay the minimum monthly payment your payment may not cover the cost of interest and finance charges that accrue on the balance. Send more than the minimum monthly payment each month to help your balance will go down faster.
11. Clothing. Shop at discount stores, buy clothes in off-season, check out discount racks at stores and ask if stores if they honor competitor coupons. Buy a few jackets and mix and match pieces to stretch your wardrobe.
12. Helping Others. Don't open joint accounts or co-sign for loans. If they don’t pay you are responsible for the debt.
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I find it incredible how many of my friends are online yet never comparison shop. I don't buy anything that's more than ten bucks without checking it online. It takes you minutes and can save you a fortune. All the small savings add up.
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6. Sell Items. Sell items not used within the past 3 months or more on eBay.
That's not good advice. Many of the things we own are seasonal usage like winter jackets or lawnmowers. If you hadn't used it in a year, fair enough but not just three months.
I think the biggest thing you can do is not spend on anything you don't have to. We've been very frugal in the last year and if you are careful it doesn't take long to build up some savings little by little. I used to buy a lot of junk I didn't need and cut it all out. I don't feel I'm missing out either.