Debt Consolidation Credit Counseling In Phoenix

You have reached the point in your life that you realize that you need to make some drastic changes in how you manage your spending and credit before you reach the point of no return. You do not want to rush into "debt consolidation" or use a home equity loan. You need to have a plan that is worked out very carefully.

You will start by collecting all your credit reports, bill payment statements, and credit card statements, mortgage and insurance records. Locate debt worksheets on the internet to help you work. All of these steps will be taking place at the same time.

Make sure your credit reports are accurate. This may involve some written communications with one or the other of the three major credit bureaus. Be persistent.

Put in writing all of your financial obligations. You will be particularly concerned with credit cards and perhaps small loans. List the cards with highest to lowest interest rates in order, and the minimum payment for each card.

Now need to know your DISPOSABLE AND DISCRETIONARY INCOME. These "d" words are significant for your plan. Disposable income is the amount of money that comes out of your salary to cover necessary obligations like mortgage, food, utilities, insurance, car, credit cards. Subtract total disposable income from salary, you have discretionary income, the amount to be applied to debt.

Determine which credit cards and loans you can pay down in order. For the first on the list, pay as much over minimum as possible. Pay minimum on the others. When the first is completed, apply that payment to the next in line and so on. This will be an ongoing money management strategy for a long time.

Commitment is definitely needed when you take on this major project. You will have to change your lifestyle. You have to stop living above your means. There will be no more unnecessary spending. Buy only essentials, eat at home, find alternatives to travel. The BIG MUST IS STOP CHARGING.

This situation didn't happen overnight and it won't improve overnight. Is it worth it? This is your financial life. You are the one who has to save it.