How to Eliminate Debt Quickly

Most Americans live in a state of debt until they die. Very few Americans retire with a nice little nest egg. Sadly, most people of retirement age live in a state of poverty as they struggle to pay for their own healthcare and are forced to sell their homes. All of this can be avoided with planning and a great deal of discipline. It may mean you have to live like no one else today in order to live like no one else in the future. The most important thing you can do to secure your financial future is to learn how to eliminate your debt...quickly.

You must be mentally prepared when making this decision. It involves a great deal of sacrifice and discipline. Saying "NO" to debt and unessecary purchases is going to keep you financially on track. Learning to save instead of spend will help you to live like no one else in the future. But first you must learn to make certain sacrifices in your every day life. It might mean you drive a little older car that is paid off as opposed to buying or leasing a new car with a $500.00 a month payment. Trying to keep up with the Joneses is what gets people into deep debt.

The first step to eliminating debt quickly is assessing your financial situation. You must know the severity of the situation before you can create a plan of action. Are you a few thousand dollars in debt? Or are you tens of thousands of dollars in debt? Or even hundreds of thousands of dollars in debt? Each situation will require the same methods to eliminate debt. The time frame of course will be lengthened if the amount of debt is exceedingly high. Knowledge is power. It provides you with a tool, a plan and a method. To understand your financial situation you must sit down and pull out loan documents or request loan status information from your home lender, credit card lenders, auto loan provider, school loan provider, etc. Make a list of all of the totals starting from the least amount of debt to the greatest. This list will now be your first weapon to eliminating debt.

Now that you have your list you will need a plan of action. One of the best things you can do to keep from incurring more debt is to have an emergency fund set up. This emergency fund will be a key element in keeping you on track. You must first put away at least $1000.00 in the bank. This money is not to be touched unless there is a legitimate emergency. A vacation is not an emergency, your car breaking down and needing a major repair is. Most people don't have a thousand extra dollars they can just throw in the bank, but there is a way to budget this into your plan so you can have it saved up in a couple of months. When you first start eliminating your debt it will be a slow and steady process. You start by building your emergency fund and then you begin paying off your debts, from smallest to largest.

The most effective way to eliminate debt is to start by paying off the smallest debt on your list while paying the minimum payments on everything else. When the first debt is eliminated you will begin to have more "free" money in your monthly budget. When the first debt is paid off-eliminate it . If it happens to be a credit card-cut it up for good! Don't fall back into the same cycle and say "what if I need it for an emergency?" Well, that is why you have the emergency fund in place.

Once you pay off the first debt and eliminate it, you must repeat the cycle with the next largest debt on the list. Double and triple pay your payments until it is eliminated, but continue to pay the minimums on everything else. This is way the system works. The method is proven to work if you stay disciplined and don't continue to add more debt to the pile. Eventually when all of the smaller debts are gone and only the mortgage is left...you will be able to make double house payments every month, or maybe even triple house payments. This system has helped tens of thousands of people eliminate their debt quickly and has given them hope for the future. By eliminating debt you can begin to save for what is important...your future and your retirement. If you only want to work til you are 50 years old...eliminating your debt quickly is one way to make that happen. You may have to drive a car that is 15 years old...but you will have a nice little nest egg to retire on and an even bigger piece of financial security.