But to start at a very simple point, you need to understand how you got into debt in the first place.  Unless you figure this out, all the tips and tricks in the world to get you out will be short lived.  I have worked with many clients over the years on debt management, and the bottom line is, getting to the source of the problem and developing a different way of thinking about money will truly help you overcome the debt burden for good.

Before I go into how to get out, I want you to take a few hours and organize all of your debts and monthly bills.  I recommend using a spreadsheet or just simply writing it out on a piece of paper.  It doesn’t need to be fancy.

You need to itemize your bills by who is owed, the due date, the amount owed, the balance, and interest rates if debt.  Just use the minimum amounts due for now (for credit cards).

Once you have this information, compare this to your net monthly income; you net income is the amount you get after taxes and other withholdings.

If your monthly income is less than your total monthly bills, this problem is not easily solved.  Because at this stage, you only documented your bills – these are things that are due monthly or weekly.  This does not include the rest of your living expense (discretionary), such as food, clothing, entertainment, etc. 

Whatever your personal outcome, stay tuned for more information on what to do next.

photo credit: Andres Rueda

This post via the Freedom Debt Management blog, an educational resource to help you gain control of your debt management and finances.

Ways to Get Out of Debt