Five Key Steps for Finally Getting Out of Debt This Year
by www.Sedona.com
Now that the holidays have passed, many Americans are feeling the financial hangover of their holiday spending. January is a key month for personal debt to rear its ugly head, as coupled with your generous holiday-spirit-spending is any debt you previously owed. This may explain why an estimated 77 million Americans choose a New Year’s resolution that’s financially related, according to a poll by Money magazine and market research firm ICR. However, only one of four people keep their promise. As it stands, the average U.S. household carries a debt of about $14,500, not counting mortgage debt, and about 40 percent of families spend more than they earn each year -- but these rather grim statistics don’t have to apply to you. With the five tips below you can make 2007 your year to become debt-free, and financially worry-free, once and for all. 1. Pay off credit cards. "If you pay only the minimum amount due on your credit card, you may end up paying more in interest charges than what the item cost you to begin with," said Janet Kincaid, Federal Deposit Insurance Corporation (FDIC) senior consumer affairs officer. You should pay off credit card balances in full whenever possible, and, for those that you can’t, begin by paying off your highest-interest cards first. Also, avoid charging items you can’t pay off in a short period of time and don’t carry credit cards with you (to avoid the temptation to use them). 2. Use cash. Only buying things in cash is a surefire way to spend only what you can afford. Cut up your credit cards, if necessary, to ensure you won’t use them for unnecessary impulse purchases. 3. Overcome emotional barriers. If you are in debt, there are likely underlying emotional components leading you to overspend or not pay your bills. Perhaps you justify overspending because you feel you deserve to have nice things, or you buy things to feel empowered and improve your self-esteem. You can overcome these types of self-sabotaging thoughts and behaviors by learning The Sedona Method, a simple, scientifically proven technique. The Method teaches you how to naturally release the feelings that prevent you from having what you want -- including financial security. 4. Automate your finances. This includes signing up for automatic bill pay and signing up to have money automatically invested each month, both of which will ensure you pay things off on time and save more, without having to give it an extra thought. 5. Develop a financial plan. Many people overlook this crucial aspect of finances; in order to succeed, you must have a plan. Develop a budget (and track your spending to be sure you stick to it) and make allowances for both long- and short-term savings (such as retirement or vacation, respectively) and an emergency fund to cover unforeseen expenses. Sources: Bankrate.com FDIC Consumer News ABC News Break through now by ordering your full Sedona Method Audio Program
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