First and foremost set up a budget before embarking on debt elimination. Do not start a plan without knowing whether or not you will be able to afford it. Sit down and plan out housing expenses, auto expenses, food and any other variables that may cost you money. Most people mistakenly allocate the money to a debt elimination plan first and try to plan the other expenses around it. Nothing is more important than your families survival! When push comes to shove and you have to decide between survival and debt elimination, survival wins, so don’t get into that position.

Secondly, you will not avoid your creditors like a plague. You will actually call them to work out your plan. Your creditors will not just disappear from the earth if you ignore them. Out of sight out of mind philosophy doesn’t work here. You owe them money and they are going to come after that money. Why not go to them and avoid the problems of them coming after you. The best way to get a creditor to attack you and your finances is to try and hide. I realize that you are fearful of what may happen therefore the natural tendency is to do nothing. You will feel like it is better to do nothing than to do something wrong. In this case communication is really the key. By telling your creditor what is going on and that you are asking for their help, they will realize you are trying to pay the debt. Once they feel you are trying your best to repay them, they will do anything to help to get their money back. Asking for help usually brings out the best in people.

The next step goes hand in hand with the previous one. When you say you are going to do something, DO IT! Your integrity is all you have working for you at this stage of the game. If you have made concessions with your creditor and you fail to do your side, the creditor will not trust you again. Think how many times the creditor has been lied too, do you want to be associated with those people? The reason we budgeted as the first step was to put you into a position to be able to keep your word, not go back on it just to temporarily appease them. If your income isn’t stable don’t set up a repayment plan. If you are uncertain of your being able to commit to a plan, don’t. Communicate these reasons to the creditor so you have a chance to work something flexible out.

Finally, don’t do a plan unless it takes less then five years to complete. Depending on the amount of the debt three years may be the maximum here. With chapter 13 bankruptcy you can take 5 years to pay back the debts. I see no reason to go over the time allotment for the worst case scenario. Any debt elimination plan should be planned for three years so that you can see progress and it is not a perilous process. Adhering to this rule means you need to know how long any plan is going to take, so ask your creditors for something in writing.

I hope this helps in organizing you to get out of debt. One of the largest problems in the country is the current debt load we are facing. The fastest way to financial independence and great credit, is to first get out of debt. My hope is that everyone gets out of debt and builds financial freedom.

David Forer s a financial veteran of 15 years. To receive more advice, tips, and tricks about credit and debt go to Credit Repair Services When there sign up for a free ten page report on credit repair tips.

Article Author :David_Forer