Get rid of the old debt in the new year

Use these tips to eliminate old debt In the new year

The New Year is quickly approaching and brings a promise of a fresh start. While you are creating your resolutions, include the elimination of old debt. Old debt will continue to devour any funds that could be earmarked for savings or other goals.

There are steps that can be taken to get rid of debt. First, add up your debt to get the total amount that you owe. Calculate the amount of your monthly debt payments. Next, total up your monthly expenses and income. Subtract your monthly expenses and monthly debt payments from your income. Do you have enough money left in your budget to make additional payments towards your debt? Examine your daily spending to see if there are any expenses and can be reduced, replaced, or eliminated. This money can then be put toward the payment of your debt.

Additionally, there is more information available to help you with this New Year’s resolution.

  •  If you would like to learn how to restructure your debts and pay them off, use the following online resource.
  • Do you wonder if making extra payments will really make a difference?
  • This online resource will help you figure out how long it will take to pay off your revolving (credit card) debt.
  • An online tool, Power Pay 5.0, can help you prioritize your debt payments and perhaps pay it off quicker.         

Lastly, refrain from creating new debt. Put away the credit cards. Make debt elimination your top resolution. Apply any monetary gifts, tax refunds, windfalls, pay increases, etc. toward the debt. After a debt is paid, roll that payment into another debt. Continue to do this until the debt is gone.

Michigan State University educators invite you assess your financial health and visit Michigan State University Extension. In addition, Michigan State University offers money management and homeownership classes. For more information about classes offered in your area visit MI Money Health

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