Paying Off Debt

With credit-card debt at epidemic proportions in this country--among the rich, among the poor--you must have seen television programs about getting out of debt, and you must have read dozens of articles explaining how to do it. I offer a step-by-step plan for getting out of debt in The 9 Steps to Financial Freedom, and there are other books available that cover the subject well, too. In short, there is plenty of help available to show you how to do get out of debt, you already know why you must get out of debt, and now I want you to take the actions that will enable you to reach that goal. Millions of people have done it, and so can you--but only if you raise it to a top priority and keep your vow to yourself to do it.

Having covered the topic at length in my Nine Steps Book, I am only going to summarize it here, because if you need to pay off debts, you need to know everything you can. However, here are ten important points to keep in mind:

1. If you are in credit card trouble, you must cut up all of your credit cards now, with the possible exception of one card for emergencies; do not carry this card in your wallet, however.
   
2. You must pay more than the minimum payment every month, as much more as you possibly can. If you owe a credit card company $5000 at 18 percent interest and all you do is pay the minimum each month it will take you over 30 years to pay it off.
   
3. You must pay off the credit card with the highest interest rate first, and the rest in descending order.
   
4. You must negotiate for yourself the best interest rates, even if it means switching credit cards every six months.
   
5. You must understand everything about how your credit card works--all fees, how the company charges you, all about the so-called grace period, everything.
   
6. You must honor all your debts equally--whether it's the money you owe Visa, or the money you owe your brother.
   
7. After you pay off one credit card, you must apply the money you have been paying that particular company to paying off another credit card.
   
8. If you doubt that you can do this yourself, you must get in touch with a wonderful nonprofit agency known as the Consumer Credit Counseling Service; they can be reached by calling 1-800-388-2227. They will help you organize and consolidate your debt.
   
9. You must never let this happen again.
   
10. After your debts have all been paid off, you are to apply the money you were paying all those months toward creating your future.