The RIGHT way to pay off your credit debts!

Paying off your debts is probably one of the most intelligent decisions you can make in your financial life. It naturally follows that every Tom, Dick, and Harry on the planet has a way to make a buck off your hardships, and a corresponding method by which you should pay off your debts. Many of them want you to take out consolidation loans so you can get "one monthly payment" and many of them want to sell you their "fix your credit" services and many more want you to take out a home equity loan. All of this crap is bad and is exactly what I just said, CRAP!

So you ask, "Well then, how DO you do it?" I'll tell you. Once you have made a budget and once you have trimmed the fat by getting rid of bills you don't need, you should by now have an idea of the amount of money you can put toward paying off your debts. If you don't, then please go back and create a budget to get it figured out. Once you have this number in mind it is going to become very important for you to pay off your debts accordingly. You will pay this on your debts EVERY single month until you are DEBT FREE.

Sounds simple, and it is, but there is more. Most of those who are in debt to the extent that they need help getting out, also carry more than one debt. Some of these debts are more expensive than others and you can benefit by paying the more expensive debts first. For those who don't follow, the more expensive debt is the debt with the highest interest rate. So what we are going to do is add up the total monthly payment of all of our debts, and subtract it from the amount of money when can afford to put toward our debts. Whatever is left will be paid toward the debt with the highest interest rate every month. Over the course of getting out of debt this will save you the most interest in the long run, which means paying off debts not only gets you out of debt, but in a way actually puts money back in your pocket.

It is very important you continue paying the entire amount of money you have allocated toward your debts EVERY month. If you are paying minimum payments on debts such as credit cards, you'll notice those minimums go down every month. If you do minimum payments it will takes a VERY VERY LONG time to get everything paid off. You want to pay as much as absolutely possible every single month to get these debts paid off.