Debt Management Tip

A debt management tip can significantly help people who are unsure how to manage their money, credit, and debts. Debt management tips can be found from numerous sources, including Internet sites, credit counseling services, banks, even friends and family. While most are probably legitimate, beware that not all advice is good advice. The best advice is obvious: avoid debt in the first place. Some of the wisest (and, in fact, wealthiest) people buy only what they need, pay in cash, and avoid overextending themselves financially. Although this sounds a bit old-fashioned or idealistic, it is a debt management tip that offers a lifestyle worth considering.

This information is easy to read and even agree with, but actually managing finances well will require persistent effort. Of course, the best debt management tips are ones that agree with biblical wisdom on the subject of finances. Everything we have is really God's in the first place and we should seek to honor him with our resources. "But thou shalt remember the LORD thy God: for it is he that giveth thee power to get wealth, that he may establish his covenant which he sware unto thy fathers, as it is this day". (Deuteronomy 8:18)

One of the first things to do is make a thorough listing of all sources of income and all expenditures. Include all liabilities, indicating specifically who is owed and how much the balances are (not just the minimum payments). Armed with this information, a person may be able to devise a budget by themselves. The debt management tip here is to look very carefully at where the money is being spent. Many people don't realize how much money is wasted on a daily or weekly basis because "it's only a dollar" or "it's on sale."

Once extra funds are discovered, a person can cut back on spending and use that money to pay down debt. This brings us to the next debt management tip, which is to pay as much as possible on the debt with the lowest balance first. Then when that one is paid off, move on to paying off the next lowest balance. This option gives a sense of accomplishment and motivation. Consider calling a credit counseling service for assistance. These agencies can work with someone to develop a workable budget, help settle debts with creditors, and provide valuable information about other debt management tips and alternatives including loan consolidation and bankruptcy.

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