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Easy Ways to Get Out of the Debt Quagmire

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Man screaming in car, money. Title Loans ExpressYou can turn the tables on crushing debt by following universally accepted solutions that are easy to implement, provided you show the right spirit and nerves of steel to accept the challenge head on.

Stop acquiring new debt that only increase your woes

Stop adding to your debt burden from the word GO. This is the first line of attack on debt reduction. Your major resolution should be to place credit cards in cold storage and not draw any further balances. Stop considering credit cards as a safety device, stop thinking of cards as a convenience tool, and cut the umbilical cord that connects you to discounts, bargains and sundry freebies which kept you hooked so long. Once you have stopped card usage start calling each company and hammer out a fresh repayment schedule for existing balances.

Avoid expenses that drain your salary unnecessarily

If earning a salary is necessary for meeting expenses, cutting expenses is essential for survival. Analyze all personal, official and domestic expenses under every head and cut back at least 15% under each category. Decide your basic needs and treat all other expenses as worthy of reduction.

Establish an emergency fund

This creates a base for debt servicing, and provides survival money for emergencies and natural disasters. How much you need to save is entirely up to you, but keep around $1,000 as an immediate goal that once attained should be boosted gradually. This fund should be used only for an emergency medical admission, a car accident, a legal dispute, a natural disaster or any sudden unexpected expense. Keep the money safely out of immediate reach in a bank savings account.

Implement a debt snowball

Up to this moment you have stopped using cards, you have cut back substantially on expenses, and you have finally created an emergency fund. Now is the moment to attack your debts with religious fervor throwing into the ring every spare dollar you’ve got. Psychologically, the debt snowball method gives maximum satisfaction. Briefly this is how it works:

  • Prioritize all loan balances in order of their outstanding balances. Start from the lowest balances and gradually move up the debt ladder to the high interest bearing scarier loans.
  • Take stock of you total income from all sources, even part time work and after keeping aside money for essential expenses, decide what you can spare for each debt balance, reserving the maximum you can for eliminating the lower balances first. So far as the bigger loans are concerned pay only the minimum balances for the time being.
  • If possible sell something unused or unwanted to eliminate small loans. Once these loans are eliminated continue the same strategy for all other loans in ascending order of balances. The results, though time consuming, can be psychologically energizing.

While you focus on debt snowballing stick to the basics of sound personal finance:

  • So long as you have bad debts to pay off, contain all expenses and take a temporary break from wealth creation, and always live within your pay grade. Relearn the art of frugality in daily living.
  • Try and supplement the existing income through overtime, new jobs and part time work. Share your goals with your boss and seek help through a salary raise in return for doubling your working hours.

Learn the easy ways to tackle emergencies

The installment loan in California offers an amazing way of tackling unexpected expenses that knock out your savings. The car equity loan is approved on the collateral of your car title documents and gives you the opportunity of raising more than 60% of your car’s resale value in the form of instant cash that can be diverted to ease your immediate cash crunch. The pawn car title loan charges around 25% APR interest but that is of little consequence considering the fact that these loans are available even if a bad credit spoils your credit rating. The auto collateral loan repayments can be kept low enough so as not to disturb your tight domestic budget. More important, the loan for vehicle title gives you a breather for recovering from financial distress and stabilizing your finances.

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