Money earned by both partners working is not the only source of extra income for a family – if the money is managed right. Sometimes a spouse will choose to take a second job – usually a night job or a week-end one. This type of “moonlighting” is quite common in certain sections of the country where manpower is in short supply. If a man’s family has been in a financial bind, this, at first glance, seems like a glorious solution. For the early weeks of the new experience, money seems to be flowing in, stubborn bills are finally paid, and the husband feels quite heroic.

This self-satisfying role may not last very long. The physical demands of long hours of work take their toll of even the sturdiest of us. The need for some time to oneself, some time to play, can pile up and burden the sunniest disposition. Most serious of all, the man who works a 60- or 70-hour week has little time to spend with his family, little opportunity to share with his wife in the raising of their children. The same could be said for a working mother. He becomes a “boarder” in his own home and a stranger to his own family. The very values which were intended to strengthen by seeking extra income will be jeopardized.

If extra income is needed, it is a good idea to take a second job only when there is an agreement in the family that it will be for a limited period of time – until the past-due bills are paid – or until the money has been saved for the summer vacation. During that period of time, everybody puts on a big push to make things easier for “Dad,” and to give him the feeling that he’s not being left out. And when the extra income has been earned, Dad goes back on a one-job basis. There are other family values which must be protected.

The best advice on credit card debt to follow begins with a plan. In fact, you should have a plan for your finances to guide your debt repayment, spending, saving and investing.
The dreaded “B” word – Budget or cash flow plan can reduce the time you are in debt and can save you potentially hundreds or even 1000′s of dollars.

To start, collect and list all of your outstanding debts. The latest statement such provide the current balance of the debt and also the interest rate. If your are not organized this may take some time, but the “pay off,” no pun intended, is worth the work.

Make sure you list all the debts – credit cards (each one separately) , mortgages, cars, boats, motorcycles, furniture, home equity loans or lines or credit, and even the money borrowed from your parents! Without a full picture of your debt, where you are at, how much is going for interest and what is required each month, you can never create a workable plan. Every dollar matters when you are getting out of debt or saving and investing for the future.

Some people argue over “good debt” and “bad debt” and make general assumptions that “good debt” would be considered something like a house which appreciates in value. However, any debt which you cannot afford and makes you a slave is “bad debt.” Tops of the “debt to eliminate” list:

• Credit Cards
• Consumer loans – e.g. Furniture
• Car Loans
• Student Loans
• Car Loans
• Home Equity loans
• Home Mortgage

Now that you have all the debts listed rank them from smallest to largest regardless of the interest rate.

Pay the minimum amounts on all debts except for the smallest debt and focus all your energy and extra money on paying off the smallest debt first.

It will take some sacrifices and changes of habits to move towards becoming debt free. But it is so very worth it!

The steps outlined above are simple and powerful – but take commitment! You DID NOT wander into debt and you cannot wander out!

If your debt overwhelms you, as credit card debt does to many, consider seeking debt consolidation help and begin changing your life!

"Reduce your debt" – a quick search of the web will give you thousands of ideas on how and why you should or should not manage money.

If you are sitting a couple of payments behind on rent or mortgage along with the credit card debt rising and the repo on your car seems like a reality, listening to the pros or cons of reducing debt is not something you are interested in hearing.

You need some guidelines to take control of your money. Plus whatever methods you have been using – honestly have not been working. No matter where you are at in your financial journey of climbing out of debt – the steps are very straight forward and simple.

4 Steps to Start Reducing Your Debt

• Access the Situation
• Damage Control
• Find a Way
• Get on Track

Accessing the Situation

It is time to get a pulse of where you are financially. Sit down with paper and pencil. Now pull out the statement of every bill and write down the amount owed, the interest rate and the monthly payment. Also list if how many months they are behind or past due if at all. List how much is required to bring the account current.

Don’t worry – we’re not mentioning the “B” word yet! Budget!

Many people never take stock of where their money is going.

They take a good look at how much money is coming in and how much is going out! On another sheet of paper write down all of the income you have coming in. Don’t look at the gross amount but the amount you actually bring home or is directly deposited into your bank account.

Now total up all the bills due this month. Subtract the bills from your income. Whatever if anything is left over after bills, deduct your cost for food and other necessary items for the month.

Damage Control

If your bills are not current, or after paying the bills there isn’t enough money left over for food and necessities – something has to give. You’ve run out on money before you ran out of month. It’s time to set priorities!

Start cutting or eliminating anything that is not a necessity. Some examples are calling features on phones, stop eating out, buying coffee in the morning and maybe sell that second car unless it’s needed for work.

Here’s a quick debt reduction or spending priority list if your are behind on bills:

• Groceries and necessary health items
• Rent or Mortgage
• Utilities
• Other bills such as installment loans or credit cards

Notice that basic needs like food, water and shelter come first.

Next step… call your creditors and let them know of your situation. Hiding from them only make matters worse. Inform them you can’t pay them. Most importantly – tell them you are actively working on the situation and promise to keep them informed.

It is surprising how many will work with you.

A credit counseling service will do the same thing. You pay them to make arrangements so they can distribute a set amount each month to your bill collectors. Do it yourself!

Find A Way – Work Hard to Learn and Improve Your Money Spending Habits

The simple fact is – you must get your finances in order. Your stress level and sanity will greatly improve. One of two things must happen. Increase income or decrease spending. Adding income may sound simple by getting another job. However, that usually increases expenses also with transportation cost and food. Taxes chew away at the extra money you make.

The best option is to decrease spending and look for cost cutting measures.

Get on Track – Time For The “B” Word – Budget

After you have taken all the steps above it’s time to budget. Make a simple budget that does not take a lots of time and stick to it.

Reducing credit card debt usually is not a big topic you find being discussed at a dinner party. No one wants to admit they have not managed their money or credit cards well.

In fact, overspending has it’s own TV series called ‘Big Spenders’ and credit cards debt usually find itself at the root of the problem. The problem of bad financial choices and over spending is not uncommon.

Reducing debt on credit cards does not need to be a complicated exercise. The actions to take are simple and basic. A few calculations and tracking expenses will quickly show you where the money is draining from your bank account. You’ll also discover where you need to begin to take action to keep yourself out of the bad credit zone.

Budgeting Guidelines

Most consumers hate the word “Budgeting” and look at it as a restrictive money item.

That simply is not true. A budget actually tells your money WHERE it will go before the money arrives instead of money going where it wants to go. Budgets are tools nothing more nothing less.

Financial institutions and leading companies use a different kind of “budget” when reviewing loan applications for debt consolidation and approving loans in general. When looking over your financial statement they want to make sure your expenses are within the recommended guidelines.

If your income and expenses are out of balance a flag goes up quickly. This flag puts your loan or credit application in jeopardy or at a higher of being approved.

Keeping your expenses within the recommended budget guidelines plays an important part of reducing your debt and living with less stress.

How does your budget or expenses stack up against the lending communities guidelines?

• Housing 35% – This includes not only your mortgage or rent but property taxes – insurance – maintenance and utilities
• Transportation – 20% – Monthly payments – insurance – gas – oil – repairs – maintenance – tolls – parking or any other transportation needs.
• Debt 15% – Credit cards – student loans- consumer loans- personal loans and any other payments on debt
• All other expenses 20% – Food – clothing – personal items – insurance (health) – prescriptions – doctor & dental visits
• Savings and Investments 10% – Retirement – stocks – bonds – mutual funds – cash reserves – rental income – royalties – art – etc.

Ratios for Debt Income

The debt/Income ratio is calculated by taking the amounts required to pay the regular monthly bills or debts each month and divide that number by the after tax take home pay.

Knowing this debt income ratio or percentage will help you gain a better understanding of your debt load and how it relates to your current financial situation.

For example if your income take home pay was $3500
Mortgage including taxes and insurance – $1250
Auto payments – $325
Credit Cards – $500
Other monthly expenses – $750

You would be spending $2825 per month with a debt income ratio of 81%.

Anything over 50% and you should begin to look for ways to reduce your debt.

Credit To Debt Ratio

Many people close or cancel their credit card account once they have paid it off. Depending on you financial position it may not be the best steps to take. Canceling the account can in fact have a negative impact on your credit score.

The negative impact comes from the Debt to Credit ratio which works similar to the Debt Income ratio but in reverse. The Credit/Debt ratio is the relationship between your total debt and the credit limits you have available. By canceling a credit card you actually raise the amount of money you owe vs. the amount you can borrow.

One item to be aware of in keeping a zero balance credit card open. If you are planning on getting a mortgage a zero balance credit card could have a negative impact on your loan being approved. Why? Lenders may look at the zero balance on the card as the method you will use to furnish the home. This in turn would raise your credit to debt ratio.

Pay Yourself First

The idea of paying yourself first is not a new idea. Read the classic “Richest Man in Babylon.” The key to insuring long-term financial stability and protecting future success begins by paying yourself before anyone else. The task by itself looks easy when in reality few people do it. The fun of “living” paying bills and increasing debt seem to come way before paying yourself.

If you stop and think about it for a moment – do you want credit card companies to prosper more than yourself? Start today paying yourself. Make it a habit! Start small if you have to – but start doing it.

If you have a 401K at work look at increasing the money they take out each pay period. Do it by percentage and not dollar amount.

Creating a Snowball With Credit Card Payments

You’re probably familiar with the picture of a snowball rolling down a hill getting bigger and bigger. You can pay off your credit cards using the same snowball affect.

Take all your credit cards and list them from the highest balance to the lowest. Start paying the minimum balance on all the credit cards except for the card with the lowest balance.

Now get aggressive and take any extra money you can squeeze and pay as much as you can on that card each month until it has been paid off. Even $10 per month will make a difference.

Then start to apply the money you would pay on that card to the next lowest balance. Continue to do that on each card until all the cards are paid off. This is the snowball affect in action.

The extra money you are paying each month compounds as each card gets paid off just like interest and starts hammering away at the balance in big chunks.

Get Financial Smart

Unfortunately much of the school system teaches little on getting financially smart. You do not need to be a money whiz to manage your credit or debt. All that is required is some basic financial knowledge and calculations.

Spend less than you earn and invest the difference – That’s financial smarts!

Everyone comes with their own reasons and desires to reduce or eliminate credit card debt. Mortgage lenders examine loan applications of those interested in buying a house much more carefully when they carry heavy debt on credit cards. Actively working to reduce the debt prior to applying for a home mortgage can give you a better interest rate in the long run.

Even homeowners facing the additional stress of open balances and finance charges on credit cards may find the stress level drop as debt goes down and disposable income goes up with focused effort.

The best way or method to attack debt of any kind is to reduce expenses (we all have places we can cut back) and apply the difference to the unpaid balance. Pay the debt with the lowest balance owed – not the lowest interest – once the debt is paid take the money paid on that debt and apply it to the next debt. Continue until all your debts have been paid off.

Some people consolidate all their debts with a loan or go the route of applying for a credit card with a low APR to bring all of their balances on to one card and focus on paying one payment per month.

Living with a cloud of debt always hanging over your head can be stressful making everyday seem to drone on. Coming up with a debt reduction plan to drop the balance of the credit cards and loans can at times seem as wide as the Grand Canyon.

Paying off the debt you’ve acquired is not an impossible mission. Yes, it will take some effort and sacrifice, you will experience some challenges, but all the effort will be worth it in the end when you can say goodbye to the chain of debt you live will.

Your “debt reduction plan” needs to be down on paper. Think of it as a roadmap. You use a map to guide you and let you see where you are along the way. You can watch your debt map as your guide to gauge your progress as you travel down the road to freedom.

Along the way you’ll need to stop and compare the budget you started with against the real numbers as you make the budget work. The budget is only a part of the overall plan. It’s the gas in the tank.

Now get started on the trip – make a get out of debt plan and follow it!

For a less stress lifestyle you need to find out how to manage your debts and how not to let your debt manage you. Discover techniques to help you make informed intelligent decisions concerning your existing debt and how to consolidate your existing loans and debt load using the best debt consolidation techniques available today.

Possibly, you are burdened with overwhelming credit card debt or perhaps a new car loan, or one of those horrible adjustable rate mortgages. Many of us have made our lives extremely difficult by taking on way too much debt, we are having conniptions trying to keep our heads above the water.

You may have a number of different payments to make every month and each one is due on a different day with different grace periods that have to be calculated and require constant monitoring, and of course they all have late payment penalties and humongous and ungodly interest rates to contend with.

These are the situations that we often find ourselves facing, making timely payments and just keeping up with the desk work is a full time job in of itself. A debt consolidation loan program designed specifically for you and your unique situation is what you need at this time in your life. A well designed program styled to your own special needs and circumstances. A stylized program will consolidate all your debt into one easily managed low payment, with a reduced interest rate and get you back on track to a better credit standing.

A personal credit management team can help you find out exactly where your hard earned money is going. Learning to you curb any poor buying and spending habits and encourage as well as develop good spending habits. Getting you started down the path of a good credit standing with one monthly payment, negotiating with your creditors to reduce interest rates and help you to become whole again free and clear of all the burdensome paperwork and worries about your debt load. This could be life changing experience and can begin in a matter of just a few days.

Reducing debt or consolidating debt is nearly impossible it you are or your partner is an impulse buyer. What exactly do we define as an impulse buyer? The simple definition would be a person who makes unplanned purchases.

Most of us all fall victim to making a purchase we never planned on somewhere along the line. Buying things without planning can run from picking up an extra package of cookies at the grocery store to buying a car with all the extras.

Impulse buying is another term for unplanned expenses and it could be what accounts of a majority of the financial problems found in families today. If you want to get out of debt and manage your money wisely, you must begin to plan your purchases.

The extra bag of chips or cookies may not send you to the financial poor house but with food prices and fuel cost today when totaled up those small expenses over a year and they can turn into thousands of dollars.

Purchasing a car without proper planning can get expensive quickly. We all want the best deal, interest rate and lowest down payment. But, you first need to decide what you and your families needs truly are. Then shop for the best deal. Someone on the road all day long has a much different requirement than a mom hauling around kids.

Here are a few tips to prevent impulse buying:

• Always go to the grocery store with a list – Buy from the list. If you see extra items you want the next time you are at the store – write them down, put them on your list for the next grocery shopping outing.
• If you find something at the store you really want – don’t buy it. Go home and write it down. Keep a list of “Must Have Items.” Wait 30 days. If you still want it and can afford it, consult your budget and buy it if it works in your budget. The allows time for you to access if it is a need or a want.
• Look at the Total Cost of a Purchase – When buying a car you must include tax. On a $20,000 purchase at 7% that’s an extra $1,400. Also new cars and special models may raise the monthly insurance cost. Gas mileage and operating is also something to consider.

The tips above may look like they take all the fun out of money. But planning where you spend your money is you taking control. It’s you telling your money where it is going to go before you spend it.

Planning and budgeting are not a sexy topic. However, when you plan your spending you’ll be able to enjoy your money much more. Don’t believe me – Try It!

Many with debt issues talk of consolidating debt and even getting out of it completely. The steps to get out of debt are relatively simple. You need to take action if you want the true freedom you will experience when you get your debt under control.

What goals do you have when you finally reach the point of getting out of debt. Write down a list of both your long and short term goals. Maybe only your list is to retire early, buy a house or even send the kids to college without them having to take out student loans. In the near future will you need a new car?

All these dreams and goals take money. It is for this reason you need to start saving with those goals in mind. Setting up a simple and workable budget will help your goals to become a reality.

Some people look at a budget as some kind of prison sentence. Budgets are guides for your money. A budget should not take hours to manage. It may take a few hours to set up initially but after that it should only take a few minutes each pay day.

When developing your budget you must look at every possible way you can cut corners but make sure you are realistic with your numbers and expectations. If you budget $500 for groceries make sure you can make it on $500. If your family needs more than that to eat and eat healthy then you’ll need to put aside more.

To become successful with managing your money you need to get organized. Someone needs to be responsible. For couples I’ve found it works best to pay the bills together. This way both parties will know exactly where they stand together. However, having one person in charge of organizing the bills, receipts and any contracts so you can get at them quickly is an efficient way to assign task.

In our house, my wife opens the bills, reviews them, I write the checks (old-fashion I guess no online bill paying yet) she then puts the bills in the envelopes and writes down the check numbers and amounts on the receipts, then she files them.

The discipline required along with a willingness to take control of your finances to meet your goals will test you. For some that may mean looking at many ways to lower your debts such as a consumer consolidation loan.

Sticking to the budget will also push the limits. When you begin a budget, Murphy’s law will so go into affect. But you need to understand the struggle is worth the pain! Soon the goals and dreams you wrote down will have a fighting chance to become a reality. Plus you will be able to truly enjoy them all without debt hanging around your neck.