How to Get Out of Debt

Jeffrey Breault here, your trusted investor and financial adviser. I know how tempting it is to make just a small purchase on your credit card, especially for especial occasions. The next thing you know, you’re up to your ears in debt and have no idea how to pay it all back.

I’m here today to help you get out of this cycle.

1. Know how much you owe

The first step to getting out of debt is to know exactly how much you owe. It’s so easy to overlook certain bills particularly if they’re small amounts but bear in mind that every small amount adds up to a tidy sum. Clients of Jeffrey Breault would know that I make them write a list that indicates the capital amount they owe, the minimum monthly payments on each, how much is the interest rate, and how many more installments they need to pay. This way, it would be very clear how much they owe and how much they need to make to pay it all back.

2. Use the snowball method

Now that you know how much you owe, the next step is figuring out which one you can pay off the earliest so that you don’t have to deal with multiple interest rates. Choose the smallest debt with the smallest interest rate. Then, put all your excess money on it while just paying the minimum on your other debts. Once you pay off one debt, you can proceed with the next one. This gives you the boost you need to clear the debts one by one.

3. Make a budget and stick to it

Finally, I, Jeffrey Breault, would tell you to create a budget and stick to it. Remove all excesses such as night outs, shopping spheres, and all sorts of unnecessary spending. This doesn’t mean that you have to live like a monk, but you would have to spend only what is necessary. All excess money should go to your debts.

Once you have cleared all your debts, then it’s time to start afresh. Do not be tempted to create new ones, or else you’ll just repeat the cycle all over again.