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Simple steps to eliminate credit card debt

Many New Jersey families want to eliminate credit card debt but are unsure of where to start. The good news is that there are simple steps people can take to get their finances under control and immediately start lowering their credit card debt.

The first step consumers should take is to locate and organize all their bills. While this may seem obvious, many people make late payments simply because they misplace or forget about their statements and invoices. Paper bills should be placed in a box or folder near the location daily mail is dropped. Online bills can be organized with programs like Quicken Books. The second step is to designate a time of the week or month to pay bills. It may be helpful for people to set reminders on their smartphone until this becomes a habit. Third, all debts should be listed on paper or on a computer spreadsheet. This provides an overview of the situation and can provide guidance on which debts to target first.

The fourth step is to create a budget. A good formula to use is known as the "50:30:20 rule." This means that 50 percent of the budget should be allocated toward "needs," 30 percent should go toward "wants" and debt elimination and 20 percent should go toward savings. The final step is to automate as many payments as possible. This ensures that payments are made on time.

Credit card debt can seem overwhelming. However, a key to eliminating debt is to focus on small victories. Small wins inspire people to keep going and can add up to a debt-free future. New Jersey residents struggling with unsecured debt may benefit by consulting with a lawyer. Legal counsel may recommend filing for bankruptcy in order to get a financial fresh start.

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