What is the best way to get out of debt when income is less than debt?

MiniJordan

Hi,

I live by myself and I work full time 40 hrs. I get paid $15.45 an hour, after taxes,401k,ect and all take home is about $950 roughly.

Thing is, I have about 5 grand in debt. made some bad choices ect long story... i want to fix it.

The good news is, I'm down to one credit card with a balance. The other 2 had small ones, I paid em and cut them all up. I have 2 cards, one has a zero balance(national city bank Visa) and the other has about $2100.00 on it(its a key bank mastercard). I plan on keeping one for emergences but once the one with the balance is paid, its getting cut up. The interest is about 14% on it.

i owe about 3600.00 on my car, the loan has an interest rate about 13%. i bought it in June, I put like 5 grand down so I don't owe a payment till June of 09 but just want to get it done by then. The sooner the better. Early pay off penalty is 150$.

Any ideas? A debt card seems to be bad for me to. maybe just use cash?

Thanks for advice...

barbarawright

Are you in the USA? You might want to ask an American board for advice. Good luck

FireWyrm

barbarawright wrote: »

Are you in the USA? You might want to ask an American board for advice. Good luck

Although the symbol in front of the money may change, the principle of money management is the same regardless of currency.

You cant get out of debt by taking on more debt, so dont be dazzled by the 'consolidation' options. Really, your only choice is to either earn more, or spend less. Get as much of your debt onto the 0% cards as possible and then just plug away. You can use various software such as YNAB which allows for alternative currencies, or there are many free budgeting spreadsheets around : https://www.vertex42.com for a start.

datlex

I think the principles of reducing debt work the same in every country. ie reduce spending and budget. However for the specifics of what you can get in a specific country you need advise from people in that country.

andersonsophie_89

Sell some items which is not needed and try to raise money. Also ask families and friends for a loan and put a set money aside to pay off that personal loan. So you be paying off a loan without having the interest added on.

This is the reason why it is good to have gold/ precious metals. I heard this advice from Gerald Celente on infowars once. Gerald Celente is said to be nodidamus of economics. He gave this advice but said it is easier to give the person you are borrowing the money from the precious metal to hold on to. And say if you fail to give the money back, they get to keep the gold. If the value of the metal goes up (trend shows it hold its value or goes up the past 10 years) they will be in pocket. If the values goes down you will pay the remainder. Apparently you will find most people will agree to this.