This is an guest post from the Personal Finance Blog Debt Discipline:
[Guest author today – Michelle Blackmore - Freelance Financial Writer]
So, are you up to your eyeballs in credit card debt? With credit cards easily available, credit card debt is too commonplace. There are different circumstances that lead to debt and one of the most common reason behind this is irresponsible financial planning and financial ignorance. They say ignorance is bliss but when it comes to managing your finances, this is not at all true. Most debt situations can be rectified with effective financial planning and intense effort through a long period of time and hence if you stay focused towards your debt reduction efforts, you can easily remain on the right track. Although it is possible to consolidate credit card debt yet this is certainly not the ultimate panacea to your soaring debt woes. Without adopting a frugal life, it is never possible to save money and accumulate enough funds to repay debt. So, have a look at the ways in which you can adopt a frugal lifestyle and stay out of debt.
Systematize your debts
You should make a chart of each and every outstanding credit card debt in order from the smallest to the largest debt amount. Then you shouldtry to snowball your debts by repaying the smaller amount first and then concentrate on repaying the next debt with the second highest principal balance. As you see the smallest debt amount being repaid first, you will be motivated to repay your debt even sooner.
Stop using your credit cards
If you don’t want to keep incurring debt time and again, you should close all ways of incurring further debt. Make sure you stop using your credit cards as without this, it is almost impossible to control your expenses. Credit cards are the main reason behind the soaring financial worries among the consumers and hence you should avoid using your cards as much as possible. Instead of carrying your cards, you can carry cash in your wallet so that you stop shopping when you exhaust your cash.
Pay more than the minimum monthly payment
The credit card company might tell you that it is okay with making just the minimum monthly payment but you should be aware of the fact that the longer time you take to payoff the principal balance, the more will be the interest rate that you will accumulate on the debt account. So, try your best to save money and pay more than the minimum monthly payment so as to get rid of debt sooner.
Delay all those unnecessary purchases
If you don’t want to fall further into debt, you should delay all those unnecessary purchases which you can certainly do without. Make a list of all those expenses that are necessary for you and all those that you simply can’t go without. Postpone all those unnecessary expenses so that you may have enough to save and get out of debt with. Therefore, when you’re wondering about the ways in which you can get out of debt and also lead a frugal lifestyle, you may follow the above mentioned steps. Stay on the right track and get out of debt without having to file bankruptcy.