Step 1 To A Debt-Free Life: “Take Stock of Your Debt”

You’re determined that this will be the year you finally pay down (or pay off) that debt. Get ready, our “Do It Today” plan will have you taking another step on your journey toward living a debt-free life.

Determine What Debt You Have

First, sit down and take stock of all your debts. Don’t let the numbers scare you; you need to do this to move forward. Get out every single credit card bill, personal loan, student loan, and any other debt you’re carrying (except your car and mortgage payments). Tally up the numbers to give yourself an idea of what you’re dealing with.

Organize Your Debt

Next, organize your debt into different categories, such as credit card debt, student debt, personal loans etc. Use a spreadsheet to list your debt, the remaining term of each loan (if applicable), the minimum payment and the interest rate.

Improving Your Debt

Finally, designate one hour each week for working on your finances. Along with listing out all of your debt is creating a budget, which we’ll cover later. If you really find yourself diving deep into your debts, order them by the greatest costs (including minimum payment and interest rates/fees) to see which you should focus on first and pay off. You may find that you need to pay more than the minimum payment to avoid fees and greater interest later on, or that you can afford to pay more than the minimum.

For more personal finance tips and helpful resources, be sure to check out the Dort Credit Union blog and if you are looking to talk with someone, check out one of our locations throughout, Genesee County, Lapeer County & Shiawassee County.