Let's face it - with the recent economic recession, many people have been flooded with debts. This could be due to a variety of reasons - getting laid off, companies folding up, rise in the cost of living etc.

Are you frowning because your debt has hit another peak this month?

Here are some simple yet effective tips to reduce your debts:

1. Strategize Your Debt

First and foremost, make a list of all your debts, including but not exclusive of credit cards, car loans, student loans, house loans, medical bills, etc.

Arrange them so that the one with the largest balance appears on top and the smallest at the bottom. Watch out the minimum payment that is due at the current moment and also ensure that you settle those amount soonest possible.

2. Avoid accumulating more debts

Stop using your credit cards. Don’t buy something if you cannot afford to pay in CASH! Do not take up any more loans before you settle your debts.

3. Reduce Your Expenses

Review your monthly expenses and eliminate any unnecessary ones. Always look for better deals before you make any purchases. Bring a calculator along when you are shopping. Reduce and if possible, eliminate unhealthy habits that cost money, e.g. smoking, alcohol, gambling.

4. Live within your means

As your priority now is to balance up your income and expenses, certain sacrifices are necessary. Consider traveling by public transport and cutting down on entertainment and if necessary, moving into a smaller house. Shop for ingredients and prepare your own meals instead of dining in restaurants.

5. Save money

Set aside 20 - 30% of your monthly income now into your savings account in the bank or even 10% would be good enough if you do it regularly. These amounts of money would then become your fund during an emergency, say when you get a flat tire and need to spend money to fix it.

6. Monitor your progress

It is crucial to monitor your debt-busting progress, not just to gauge how well you are doing but also to motivate yourself when you see your debt is reducing! Do it by putting charts of progress on their fridge or in their diary and update them once a month.

There you have it.

With the above measures taken, you are one step closer to becoming debt-free!! With these action plans, clearing your debts becomes easy as A, B, C.

But if you want advanced insights that you can apply over time to clear your debt and also turn your financial status around, click on the link below.

http:///debt_destroyer