FARUKI

Prices for all kinds of goods are going up and individuals are trying to make the best use of their money. So many people have credit card or other debt and these price increases are not leaving much to pay the debts off with at the end of the month.

Managing your debt carefully can enable you to pay it off and avoid more serious financial problems like bankruptcy. The simple rules for managing debt are to write down each debt you owe, the total amount of debt owed and the total amount you can afford to pay each month.

If you find yourself in the middle of a financial crisis, the first thing you should do is tally up your income. Find out where all of your money is coming from, and see how much you really have to spend each month. Once youave got that down, the next thing you need to do is create a budget.

First write down the necessities: food, electricity, shelter, etc…Subtract the amount you must spend for these from your income and what is left over is the amount available for paying off debt. Each creditor should receive the minimum monthly payment, so subtract that from your total income as well.

Now each debt will be at least kept up-to-date. Identify the smallest debt and use any extra money in your budget to pay this debt off. As soon as this smallest debt is paid in full, begin focusing money on the next smallest debt.

If you continue paying this way, eventually all of your debts will be paid off. If you keep careful track of your budget you will be able to pay for the things you must have and pay off your debt as well.

For budgeting assisstance look to the internet. There are multiple sites dedicated to budgeting and financial planning. Your local bank may also be able to offer help with your budget or point you to a community agency that offers such services.

Often banks offer online banking that will automatically pay your bills when they are due. This helps eliminate costly late fees and forgotten payments. Stick to your budget and you can pay off your debt - bankruptcy is not an option!