Millions of people all over the country are in debt. It may be from medical bills, it could be from student loans, or it may be because they have used too many credit cards and never paid them off. Whatever the case is credit scores are dropping and interest rates are rising. Here are six tips to help you take control of your personal debts from writer Robert Kiyosaki who had over $1 million in debt and took control in just a few years.
1. If you have credit cards that already have outstanding balances, don’t use them for purchases. Use one or two new cards that you may have with no balance and make sure that you pay everything off that month. You don’t want to end up piling on more money onto a card that you already have trouble making payments on.
2. Figure out a way to bring in an extra $150 to $200 per month. If you are able to do this you are well on your way. It can be through a side job or a product that you sell from your home.
3. Next you will want to take that extra money that you have brought in for the month and put it on just one of your credit cards with outstanding debt. This should take care of your minimum payment and throw a little extra on there too. On the other cards that you own, may the minimum amount only.
4. Once that card is paid off, keep things in motion. Begin doing this with your next card. You will be better off with this card because you have already been paying the minimum payment on it and you are also paying all of that extra money to bring your balance down. Keep this going for all of your cards and other personal debts that you may have.
5. Once you are done with the credit cards start doing this with your home and car payments. You will find that you are closer and closer to your goal of being debt free. Kiyosaki says that the average for people using this formula is five to seven years and then they are debt-free.
6. Once you are done paying off debts, you can begin to build your assets. Take that extra money that you have been putting towards your cards and personal debts and either invest it or throw it into a savings account so it can earn interest. You are now debt-free and building assets every month.