Sunday, 19 September 2010

My success story on credit card debt elimination by Jason Holmes

Leading a lavish life has its rewards; however, it also has a price that I had to pay. I had spent without considering how I would pay back, and this lead to a huge amount of debt that I could not pay off. By the time I had realized that I was in a disastrous situation, I had already accumulated $60,000 of credit card debt on 5 cards that I had to pay off. I finally made up my mind that I had to do something about my financial situation, if I was ever to live life with respect again. I strongly believed that there must be some debt solutions that would bring me out of this problem. I want to share a few things that I did to get rid of my credit card debt that you may find beneficial, in case you are in a similar situation.

  1. Formulated a budget: I used a couple of free online budgeting tools that helped me plan a budget for myself. This gave me a fair idea of my income and expenditure. I realized that I was earning enough to afford a decent living but not enough to pay off my debts or indulge in any luxury products. So I had to adjust my spending habits accordingly.
  2. Cut down expenses: After I had planned the budget and then studied it, I realized that I had to cut down on my food expenses. That is where the majority of my income was going. This was because I loved to eat out at fancy restaurants. What I did not realize was that, this was leading to an excessive amount being spent on food when I had no real requirement of that expenditure. So I restricted myself from eating out and switched to good home cooked food.
  3. Considered additional income options: It was impossible to manage the outstanding amount I was to pay with my fixed salary. So I considered various income options that I could opt for. I finally decided that online money making would be most convenient as I could work at my own convenience, whenever I got time from my hectic job. I looked for various options and finally decided to opt for writing e-books. This was a very comfortable option for me, as I was into writing from a very young age. The profit margin was also huge and helped me pay a huge part of my debt.
  4. Decided to settle my debts: I wanted to pay off my loans as quickly as I could. Debt consolidation was not a debt solution that I could consider. This is because my financial situation would not let me pay off the debt completely. Thus, I had to opt for debt settlement. I was lucky that my creditors reduced my debt by 44%. The reduced amount came to $35,400. I had to pay this much instead of $60,000, to settle my debts completely. Whatever excess cash I had or earned went into paying the debt and in about 2 years I was completely debt free.

This guest post is written by Jason Holmes. He is a regular writer with Debt Consolidation Care and is also a contributory writer with other financial sites. His expertise is woven around various aspects of the debt consolidation and debt industry, with his e-books he tries to impart to people the different situations and simple debt solutions to get out of difficult situations. Some of his works include e-books like 'Credit Score The Quintessential Therapy for a Happy Pocket', Take Creditors and Collection Agencies to Small Claims Court' and, My Story- From Depression To a Smile'.

2 comments:

Understanding Investment Banking said...

Well everyone can give advice like that as you have suggested the only problem that i feel with this kind of suggestion no one can cut down their expenses dramatically it needs time and the dept is continue increases.

Stuart

Kamal said...

Cutting down expense is the most major important thing need to do when trying to solve financial turmoil. Because habit of living an expensive lifestyle is the root cause that started the financial problem at the first place. If we want to do it, we can do it. I know, I have done it. I cut down my expenses to only 15% of what I use to spend on within 3 month, but it definitely takes a lot of courage, discipline and self-motivation. But nonetheless, it need and can be done.

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