This article will present some good ideas on strategies for eliminating debt and how to stay debt free.

The strategies I will be presenting in the article are all well know but many of us just fail to implement them or don’t remember them.

Just remember that it’s not totally your fault if you are drowning in debt, some of the blame can be contributed to big business rhetoric and government promotion of over spending to keep the economy moving along.

Big business, like credit card companies, offers incentives that are way to enticing to turn down plus they do a good job catering to our emotions. But you can bet in the end you will be fully responsible when you cannot payback your loans.

Not all debt is bad; in fact it is pretty normal to have a mortgage and one car payment. This debt reduction strategy really focuses on managing your spending habits on nonessential items and eliminating high interest loans.

Listed below are steps one should take in order to achieve debt free status.

While you have debt you must learn to stop buying items that are considered luxuries. One of the biggest wastes of money is eating out, by not eating out several times a week you can save around $100 per week (family of 4). Packing your lunch can save you even more. You must stop going to the movie theater, instead rent a DVD or purchase a pay-per-view movie. That can save $40 right there alone (family of 4). You should try to stop wasting fuel by planning out your trips into town by creating a to-do list and stay in the same area for less travel. Another good way to save money is to turn down the thermostat to 69 degrees in the winter and 78 in the summer. I have personally save money by stopping washing closes that are not dirty and cutting back on using dry cleaners. Clean up your clutter and sell those items by having a yard sale or placing them in the local and/or online classifieds.

If you just sit down a make a list of all the spending you do I’m sure you can add other things to cut out or back on.

Now here is the section that will give you the formula for getting rid of that debt forever and if you learn to only live by your means after you become debt free, you will be able to start saving money instead of handing it over to the financial institutions.

First, write down all of your bills, exclude those bills that are considered essential, like utilities, fuel, mortgage, insurances, and food you buy from a grocery store.

Select the loan with the highest interest rate; do not worry about what the balance is. Apply all monies saved by cutting back and the minimum payment amount toward that loan. Do this until that bill is paid off. Next apply the money you were putting toward the first loan along with your minimum payment to the next highest interest loan. Keep doing this until all your loans are paid off. After you achieve that goal start focusing on your car payments and then mortgage.

If you commit to following this strategy it will not take long at all before you are totally debt free. The hardest part of this is staying focused and disciplined. Good luck!

Dennis Watson has been helping others promote their products or services for years through his Free Classifieds website http://www.zeoh.com/

Debt Consolidation Agencies

Before contacting a debt consolidation agency you need to be aware of what they are capable of doing and compare that with your financial needs. Using the services of a debt consolidation agency is a decision to be taken as last resort. Once the fact that you’ve got into a debt consolidation program is reported, your credit history will reflect this and your ability to get finance will be considerably diminished.

However, if your current bills, loan installments, unpaid credit card balances and all other debt have become an unbearable burden, then a debt consolidation program might be your only chance to avoid other more extreme measures like bankruptcy.

A debt consolidation agent will be assigned to your case. He will gather all the information available about your credit, your outstanding debt, your income, your assets, etc. and with that information he will design a plan. He will contact your creditors and negotiate with them. Since your creditors want to get paid, they’ll agree more flexible conditions and they will resign to charge high interests on your debt. They know now that if a consolidation agent is taking care of your debt chances are that if they don’t cooperate, they might get nothing.

There are mainly two different options after negotiation. You may obtain new repayment schedules with lower rates and lower monthly payments you’ll be able to afford or sometimes the agent agrees with the creditors a reduction on the whole amount of debt in exchange of immediate cancellation of their bills, balances and loans. If the agent takes this second path, he probably has arranged for you to get approved for a consolidation loan. The money obtained will be used to repay the new negotiated debt and you’ll end up with a single monthly payment: The loan installments.

Consolidation Loans

With the aid of a debt consolidation agency, it is much easier to get a consolidation loan in order to cancel your debt. The lender knows for sure that the money will be used to repay and cancel all your debt. Probably, the agency will arrange for the money to be directly transferred to the creditors. The lender will then be your only creditor which lets him in a privileged position when it comes to recovering his money if he has to take legal action in order to do so. And that is the main reason why with the help of a consolidation agent non-homeowners can get approved for debt consolidation loans too.

Sarah Dinkins is an Expert Loan Consultant in the financial industry who helps people to repair their credit situation and get approved for home loans, unsecured personal loans, student loans, consolidation loans, car loans and other types of loans and financial products. In her website http://www.badcreditfinancialexperts.com she writes useful articles for people looking for professional advice in the finance field.

Understanding The Procedure

Let us understand what this is. As the name suggests, consolidation involves merging your various monthly dues, so that you do not have to make separate payments on various days of the month, by writing many checks. Debt consolidation help allows you to simplify the whole process and thus you only write a single check, and the payment is distributed to your various creditors. This is beneficial in more than one way. Besides making the whole process comfortable, it allows you to plan your budget in terms of your income and expenditure. Debt consolidation credit help also drastically lowers the average interest rate on your loans and you end up paying lesser money than you would have, otherwise.

Indirect Advantages

The good experience that free help gives you leaves you very happy. But there is more to be pleased about. While clearing your overdue amount with, debt help, you also improve your credit score side by side. Let us understand how it happens. When you slowly pay off your pending amount by paying timely payments, your credit rating goes up. This places you in the good books of the lenders. So, they not only easily sanction you loans in future, but also charge lower rates of interest. The rate of interest charged to a debtor is inversely related to his credit rating. The higher the credit rating, the lower the interest rate and vice-versa.

Some More Rewards

This is not all. When you take consolidation help, the company also negotiates with your lenders on your behalf. They deal with such issues professionally and thus are able to bring down your total payable amount. Therefore, you save not only on the interest but also on the actual sum borrowed.

So, when you are dejected and do not see any way out of your financial situation, seek debit consolidation help. It will give you fresh lease of life, and you will once again be able to breathe easy. It will take the burden off your shoulders and give you a chance to think about some savings also.

Debt consolidation help gives you an ideal package by lowering your monthly payments with debt consolidation credit help; reducing the rate of interest on your loans and also providing free debt consolidation help.

Home Equity Loan

A Home Equity Loan or Home Equity Line Of Credit taps into the equity in your home–the amount your home is valued minus the amount you still owe on it. You borrow against this equity, essentially using your home as collateral. These loans tend to have super low interest rates, and in many cases the interest you pay throughout the year is tax deductible too! But don’t sign up for one unless you’re absolutely sure you can make the monthly payments, since your lender can take your home if your loan goes into default.

Debt Consolidation Service

A debt consolidation or debt management service will roll all your bills into one monthly payment. You pay the service once a month, and they divvy your payment up among creditors. They may also be able to negotiate on your behalf for a lower interest rate, which could save you money in the long run. Watch out for scam artists who make promises they can’t keep, though. Check out any debt consolidation service thoroughly with the Better Business Bureau.

Personal Loan

In some cases, you may be able to get a personal loan from a bank or credit union. And since the average interest rate on a credit card is about 18%, the loan may be able to help you lower the rate you’re paying. Simply borrow the amount you need, pay them off, and then you’ll only have one loan–your personal loan–to worry about.

Try using one of ABC Loan Guide’s Recommended Low Interest Debt Consolidation Companies.

As you look for a debt consolidation solution, be sure to explore lots of options. Many of them can help you do more than just consolidate your debt–they can help you get a lower interest rate, too!

View our recommended lenders for a Home Equity Loan . Also, view our recommended sources for a Bad Credit Debt Consolidation.

Gerri Detweiler, author of Slash Your Debt, Save Money & Secure Your Future and founder of DebtConsolidationRx.com, notes,

“Americans are pretty optimistic so it often takes a long time for a consumer to realize credit card debt is a problem. Most of us are counting on something to help us get rid of the debt quickly. It could be a raise, business income, even an inheritance or lottery ticket.”

That’s what Chip and Shelley Smith of Midland, TX thought when they first got married. Happiness must at least partly come from keeping up with the Jones’s. But years later and upwards of $50,000 in credit card debt Shelley says they had nothing to show for it. They aren’t world travelers and they weren’t having any fun. It was the daily trips to Target and Pier One Imports for items they didn’t need but thought they might use one day that got them into trouble.

They finally woke up after attending a Dave Ramsey seminar and realizing the craziness of paying interest for pizza. After making changes in their lifestyle, selling lots of items on Ebay including family heirlooms, and working their way out of debt, Shelley now sleeps well at night free from wondering how to pay their bills.

You can sleep well too! Detweiler says if you have credit card balances running up with no idea how to make them start running down, if you have no idea how long it would take and how much it would cost to pay your balances off, or if you’re paying off a credit card with another credit card it’s time to get serious about your debt.

Create a Repayment Plan

This is the first important step in your journey because it lays out the path ahead. A repayment plan will clearly show you all your debts, how long it will take you to pay it off, and how much it will cost in interest and fees to pay it all back. It will also give you a good idea of what options you have. For example, Detweiler says if your plan shows it’s going to take more than 3-5 years to pay off your debt on your current budget, then it’s important to seriously consider debt counseling. Bankruptcy is also an option, but most consumer advocates stress that is should always be an absolute last resort.

For help on creating your plan, visit EveryDayWealth.com. The site offers everything from a personalized repayment plan to monthly credit reports, and ways to lower your finance and insurance costs, build better credit, monitor and protect your assets, and optimize your bill payments.

Finding Money for Your Payments

It’s time consuming and costly to try getting out of credit card debt by paying only the minimum, especially if you continue to charge purchases. But at times it can feel almost impossible to find the extra money to be able to pay more. Here are some tips to help you get started.

The “B Word”

While it’s not most people’s favorite thing to do, taking one month to track every single penny you spend through a budget is an invaluable step in getting out of credit card debt. You’re sure to find areas where you can cut back. The biggest areas of overspending are food and transportation. Detweiler says she’s seen consumers discover they were paying $200 a month for pizza delivery or $160 a month at the office vending machine. Don’t be discouraged, however, if you only find $10 as any little bit can help reduce your debt.

After tracking spending for a month you may find it necessary to make a few lifestyle changes. It may not be easy, but the changes aren’t necessarily permanent either. Here are some ideas to get you started living a more moderate lifestyle.

Making minor lifestyle changes can help you achieve the new American dream—freedom from debt for all!

Get Another Job

That’s right! It might temporarily take a part-time job delivering pizzas to get you and your family back on the right path. Or if you are living off one income so mom (or dad) can stay home and raise the kids, consider opening a home daycare or other home based business. That way you still get to be with your own children and earn some extra money at the same time.

Sell Some Stuff

Chances are you have lots of sellable stuff you aren’t using packed in the back of your closet or in boxes in your garage. And if you aren’t the sentimental type go ahead and sell grandma’s china. Even if you are sentimental, consider keeping only your most treasured heirlooms. Try not to overlook something that doesn’t appear valuable. The Smiths inherited a painting that hung in her grandmother’s garage for years and it ended up being auctioned off for $40,000 at Christie’s in Boston!

Tap Into Your Assets

If you do have some savings, consider pulling some of it out to pay off your debt. You typically don’t earn near enough interest in a savings account (typically around 1-2%) to outweigh the interest you’re paying on credit card debt (typically around 15%). You can consider tapping into a 401K plan too, but be cautious with this option. You will need retirement savings some day and according to Detweiler, these types of accounts are usually protected during bankruptcy proceedings. It may be a good idea to speak with a lawyer about bankruptcy options before using retirement money.

Moving Forward

Once you’ve found some extra money to start paying more than the minimum you’re ready to move forward. Determine a fixed monthly payment you can put towards the debt. Pay only the minimum on all your credit cards except the one with the highest interest rate toward which you will pay as much as your budget allows. Detweiler adds,

“For most people paying the highest interest rate credit card is best. Once it’s paid off, then move on to the next highest interest rate keeping your same fixed monthly payment.”

Another option that worked well for the Smiths is paying the lowest balance credit card first. Smith said that quickly getting rid of the first credit card debt gave her the confidence and motivation to move onto the next.

Contact Credit Card Issuers

It’s always a good idea to contact your credit card issuer to try and negotiate a lower interest rate. If they won’t give you a lower rate, try applying for a new low-rate credit card. The “Card Reports” section of CardRatings.com is a great place to shop and compare credit card offers. If you do get a new low-rate card then immediately transfer as much of the balance from your higher rate card(s) as possible. If possible, try not to exceed 50% of the credit limit of any of your cards as doing so could lower your credit score. By staying under the 50% mark you may find new low-rate credit card offers appear in your mail box, which could give you a valuable tool in negotiating.

If you are behind in your payments, some credit card issuers may even be willing to set you up on a hardship plan where your required payment is reduced. Credit counseling agencies may even be a better alternative. Detweiler notes,

A hardship program done directly with the credit card issuer won’t have this advantage, so as long as you are paying less than the contractually agreed upon amount your account will have a negative standing.

Final Thoughts

Getting out of credit card debt is never an easy process, but it can be done. The extra effort definitely pays off, not only financially but also when it comes to your peace of mind. We sincerely hope that these self-help techniques will help you achieve the new American dream— freedom from debt for all!

Amy L. Cooper-Arnold has been a staff writer for http://www.cardratings.com CardRatings.com since 2004. Her articles have been republished by respected publications throughout the country, including Young Money Magazine, E/The Environmental Magazine and About.com. Amy recently graduated with honors from Austin Peay Univ. and is currently taking graduate-level classes.

Where To Get

Now, the very first question that comes to mind is that from where you can get a debt consolidation calculator. Well, getting such a calculator is not a difficult task at all. Most of the debt consolidation companies offer this service on their websites. You need to input relevant information such as all existing loans, applicable interest rates and your current earnings besides some other facts also.

Once you key in these details, debt consolidation calculator comes up with the most suitable solution to your problem. These companies can also provide you guidance if you are not in a position to decide what is the best way out to get out of debt. So, the electronic calculators help you by suggesting best method and human brains at these companies help you how to implement these plans.

Use With Caution

Debt consolidation calculator displays how much money you will have to pay every month after you merge all your loans in a newer loan. By keying in different repayment periods in appropriate fields, you get to know the most suitable loan term. However, it is not advisable to solely depend on these calculators. It is always better to take into account the view of experts before the countdown to eliminate debt begins.

Rishabh Sogani has been writing articles on various topics for more than two years. You can get your FREE copy of Debt Consolidation Loan Ebook and see more of Rishabh’s articles on Debt Consolidation loans on his website at Debt Consolidation Loans located at http://debtconsolidationloans.googlepages.com/