The Beginners Guide to Credit Card Debt Relief

I’ve written many articles on how to earn money on the Internet.

As you know, there are many ways to make money online. In this article, I will tell you the best ways of getting rid of your debt. It should not have to take years to become debt free.

If you really try hard and are creative enough, you can get rid of your debt within a few months or less.

Here are the steps you should take to eliminate it. Some things you already know, others are brand new. For the moment, forget about fees and them unjustly charging you.

The focus has to be on getting it gone in the quickest amount of time.

Step # 1. Know What You Owe

Open up all the invoices to all the people you owe and add it up all together. Make a chart of who gets paid and when.

Make three columns: Who I owe, What I owe, Monthly Payment Date. Put it in a place where you will always see it, and always pay by the date that it’s due. If possible, send it a week early.

Step # 2. Pay More Than The Minimum

If you’re only being asked to pay ten dollars, pay twenty or more. Always pay at least double the amount as the minimum payment. The debt is not going anywhere if you keep paying the minimum.

Step # 3. Pay Off The Smallest Debt First

Are you familiar with the saying, ‘How do you eat an Elephant?’ the answer is one bite at a time. Start with the lowest credit card, then work your way up to the big one.

Step # 4. Make Extra Money

For people who cannot stretch their income to pay more, or those out of a job, this is the ultimate solution for getting the debt gone for good.

Forget about debt consolidation, and bankruptcy.

No matter if you were trying to just ‘live’ on credit, or just made outrageous purchases the fact is that you are the one who ran up the credit, bought a house, car, whatever.

The point is to get it under control, then start raising money to pay it off. Here are a few ways to make extra money:

a) Read The Book “Put More Cash In Your Pocket” by Loral Langemeier

I will be doing a book review on this later this month, but I’m sure you can read it yourself by borrowing it from your local library.

Loral teaches you how to use your skills and hobbies to make $500-$1000 cash every month. So far what I’ve read was very good.

I was surprised at how easy it is to really make extra money, cashing in on what you are good at.

b) Find Websites that you can join online for free and make money

I’m not talking about paid emails, and clicking for pennies(although one well known company has a website that does do this) The e-book ” Will Work For Cash” lists over 100 places online where you can sign up for free and earn money. There is no hype in it.

It’s not a get-rich-quick e-book. It’s all about making extra money on the Internet. Most of the payment is through Paypal, and the tasks that you do are very easy.

Some of the things you can get paid to do are: articles, t-shirt designs, uploading videos, photos, your expertise, news, chatting and much more.

The payment ranges from a few dollars to thousands of dollars. For a limited time, the author is giving away thirty bonus e-books with the purchase.

Some of the bonus e-books are about saving money on groceries, energy, how to do interviews, get a job, emergency money plans, over 200 more places where you can earn money.

c) Sell Your Stuff

I tried Ebay, and so far it has not worked for me. I have sold books, movies, music and games that I didn’t want through Amazon.

The best thing about Amazon is that if your product doesn’t sell, you don’t have to pay them any fee. That’s what I can’t stand about Ebay.

Whether someone wins the auction, you still have to pay a fee! Amazon is a cool, no pressure way to sell you stuff. As long as you can find it on Amazon’s list, you can sell it.

Step # 5. Stop Using Credit Cards

Learn how to pay for things in cash. Your new motto for 2010 should be, ‘Cash Is Cool, Credit Is The Fool’.

Step # 6. If You Can’t Afford It, Ask Yourself A Question First

Read Step # 4 all over again. If you see something that you simply need, make more money to get it.

If you see something you want because it’ll make you happy, first ask yourself if you really want it, if it’s something you will use for a very long time.

If that’s the case, make more money to go out and get it.

Step # 7. Create An Emergency Fund/Savings

If you can, try to do this as you go along, paying off your debt. Put a little into the bank until you can reach your monthly goal.

Decide how much money you need to live on each month, times that by twelve, then times that by ten years, and stick it in the bank for a rainy day or an emergency.

For example, if you could survive on $10,000 a month, that would come up to $120,000 a year. $120,000 for ten years is $1, 200,000 dollars.

So if you lose your job, or an emergency comes up, you’d be covered.

I’ll be doing another article that focuses just on Step # 4. Make More Money. There are so many things it’s hard to tell which one you should do, but I’ll just spend time on the most lucrative ways.

What is a Debt Relief Grant?

Many people are worried about the impending recession and the increase in prices.

It’s understandable that people are more in debt than ever and aren’t sure how they are going to get out of it. For these type of people, there are special grants called Debt Relief Grants and they are specifically for helping those that are wading in debt for different reasons.

This grant is usually awarded by associations or even private foundations and is to help the person get back on his or her feet.

Although most people think of small businesses when they think of grants, there are numerous types of grants which are designed to help people which are dealing with financial difficulties for many different reasons.

The truth is that when you take a closer look at why people are so badly in debt, you will find that they’ve had to spend their savings on huge medical bills because they didn’t have insurance, they’ve been forced to pay for repairs which occurred during a natural disaster or some other type of problem.

There are special grants for small businesses in order to help them succeed rather than failing. Sometimes businesses need an amount of money that is simply not available for them in order to succeed and these grants can really help with that problem.

Our government takes a certain amount of money every year which is outlined for grants.

There are public and private associations as well as very wealthy individuals who are able to donate money in the amount of billions combined. This money is used to help individuals with their debt problems.

There are grants available for those who are on a fixed income as well as those who may have experienced disasters. There are grants for individuals who care for others and those who own their homes, and even for those who have been abused, seniors, and disabled individuals. The list is very long and there are many types of people on that list.

Outline of a Grant Proposal

Typically, grant proposals include several different things. One of them is the reason for the proposal, or the reason that the individual or organization is in debt so badly. This will give the grantor the information that he or she needs to determine whether the applicant should be awarded the grant.

Including an objective in the grant proposal tells the grantor what the money will be used for.

Many times, they are looking for the individual to state how the money will help them in the long run to avoid more debt and to better their financial situation.

The outline should also contain an actual dollar amount in order for the association delivering the grants to determine what the needs are versus what the applicant is asking for.

Of course, the grant proposal should be very neat and clear as far as needs and information. It should be free of grammatical errors and typographical errors as well.

The main goal is to clearly convey to the grantor what the problem is and how you intend to fix it if you are awarded the grant.

There are many criteria that should be met by the individual in order for him or her to actually receive the grant.

There are terms for some grants including where you live, what gender you are as well as what nationality you are.

There are often certain dates that an individual can apply for a grant or when new applications will be taken, so be sure to check that information before applying.

Three Biggest Lies About Fast Debt Relief

If you are looking for fast debt relief, the first thing you should do is to learn the three biggest lies about it.

First Lie. If you want fast debt relief you have to pay somebody to help you out.

Those who are telling you this lie either don’t know any better or want to make money from your debt problem.

Most people can get out of debt by themselves and don’t need any help whatsoever. Everyone who is determined to become debt-free can buy How-to guides on debt elimination for under $30 each and try to take care of their debt problem.

For people who don’t have self-discipline and have a problem following the plan, there are many non-profit organizations which will help them get out of debt for free.

Second Lie. If you file for bankruptcy, all of your debts will be wiped out.

This is not true. Certain types of debts, such as student loans and child support cannot be eliminated.

Filing for bankruptcy should be your last resort, because it will do disgusting things to your credit history, and if you decide to do it anyway, make sure that at least most of your debts will be wiped out. Being bankrupt and still in debt does not really make much sense.

Third Lie. Fast debt relief is only possible if you owe a very small amount of money.

Many people think that it will take them decades to pay off debt, but it is usually not true.

For example, if you have 10 thousand dollars in credit card debt with 14% interest rate (which is pretty high), you can pay it off in less than 2 years if you put an extra $300 towards it every month.

If $300 seems like too much, get a side job, try to save money on food and vacations and stop buying things you don’t really need.

If you make paying off debt your primary goal, things will go much smoother and much faster.

Is a Debt Management Plan Right for You?

If the world were divided into spenders and savers, I would end up squarely on the side of the spenders. Whether I bought dinners out or e-books or clothing or DVDs, I could justify the expense as a necessary comfort because, after all, life is hard and we need comfort.

Unfortunately, the predilection for charging my comforts throughout my cash-strapped waitress/college days led to a massive amount of credit card debt.

Almost a year and a half ago, I realized my debt was becoming unmanageable.

I had as many credit cards as I have fingers (with a debt total creeping scarily close to the median salary of Oklahoma City) and keeping up with each payment and due date (not to mention late or over-limit fees) cut into the time for enjoyment of all the entertainment I had purchased.

At this point, I had a few options. I could try to pay the debt off myself, using the philosophies of Suze Orman or a similar financial guru to get my debt under control. I could enter a Debt Management Plan (DMP) and have an outside company make payments to my credit card companies on my behalf.

Debt settlement, wherein outside companies try to “settle” your debt for a small percentage of what is owed, is a choice some make to deal with their debt. Or, I could file for bankruptcy.

I did try to pay off my debt myself many times. I would pay off a card or two, but inevitably, a so-called emergency would come up and the card would come out again.

Before I knew it, I was in just as much debt (or more!) as I had been before I began my payoff plan. I was yo-yo financial planning – cutting some debt and then gaining back more to the chagrin of my unhealthy checkbook.

Call it old-fashioned ethics, or maybe just pride, but I didn’t want to choose an option other than paying back my debt in full. I understand when people are hit by unexpected events such as medical emergencies and they have to take drastic measures. But I just spent too much. I gave in to my wants and desires more than I stuck to my budget. I also knew I could pay it off, even if it took a little restraint on my part.

As you can probably infer from this article’s title, I chose the DMP option. I’m still only about halfway through the program, but it’s working for me so far. The program is not for everyone, however.

How to determine if a DMP is right for you:

1. Can you repay all of the debt you’ve accrued?

Unlike debt settlement programs or bankruptcy, you will have to pay the entire principal owed on your credit cards. And, while you can often negotiate low (or zero) interest rates while you’re repaying the debt, the finance charges and fees incurred up to that point must still be repaid.

2. Can you stop using credit cards?

In exchange for reducing interest rates and agreeing to a set monthly payment, credit card companies expect you to stop using your cards. Most companies disable any available credit while the debt is being repaid; in any case, you must agree to stop using credit when you sign up for the DMP. It only makes sense: if you keep using credit, you’re never going to get out of debt (believe me, I know).

3. Are you willing to set aside a consistent monthly payment?

Before I entered the DMP, I had become a master juggler of debts and payments. I moved payments around according to when I had the money to pay them, and my credit card payments were split between my paychecks. Now, I pay all of my credit cards in one chunk which is electronically debited from my account. It’s more consistent, and easier to plan for, but it does lack flexibility.

4. Can you stick with it for the long haul?

You must be patient. It may take a while to pay off your debt with a DMP. Some clients get frustrated with the slow process and give up. Once you quit the DMP, however, you also lose the benefits (low negotiated rates and no collection calls, for example).

5. Do you have money for emergencies?

Unfortunately, I don’t have enough money in my savings account for lunch. Well, maybe lunch, but that’s it. Thankfully, I haven’t had any financial emergencies (knock on wood), but it’s something you should think about. Since you can’t rely on credit if your car breaks down or the washer breaks, it’s a good idea to have some money set aside for any unexpected disasters.

If you decide you want to try a DMP, first look around for reputable companies. Search the Better Business Bureau and look for online reviews from former clients. For my program, I pay a monthly fee ($40) for the company to pay all of my credit card payments, negotiate my interest rates, and keep an online running total of what is owed on each card.

Once I finally got serious about my debt and shredded all of my credit cards, I got used to and even enjoyed living a cash-only existence. Any time I get discouraged about the amount I owe, I log on and compare my starting debt to my current debt and marvel that I’ve managed to actually pay down (and pay off) some credit cards. I may not have completely tamed my spending impulses, but at least now my purchases are cash only.