Business or Personal Debt Got You Down? Tips to Get Control over Your Spending and Reduce Your Debt Quickly

Debt can feel overwhelming. If you’re struggling with debt, the stress and weight of that 
financial obligation can bring you down. It affects your attitude and your outlook on life. 
This kind of stress and negativity isn't good for your business, nor is it good for your 
personal life.

You must eliminate your debt in order to have money to invest in your business until
it is self sustaining. In order to do this you must increase your cashflow &/or savings.
When I say savings, I mean on your expenses & purchases. When you do that it is 
like finding money that was not there. Take that extra money and use it to help
payoff your debts.

If you’re struggling with debt and your spending is out of control, here are a few tips to 
help you get back in the black quickly.

#1 Learn Your Debt to Income Ratio

Your debt-to-income ratio (DTI) compares your monthly debt expenses to your monthly 
gross income. You can calculate it quickly if you know your monthly debt payments and 
your monthly gross income (the money you make before taxes are deducted). Multiply 
your number by 100 to get your DTI as a percentage.

Ideally, you want to keep your DTI below 40%. In fact, the closer it is to 30% or less, 
the more favorably financial institutions will look on you. If you’re wondering whether it’s 
okay to take out a loan or use that credit card, calculate your current DTI. The percentage 
will help you make your decision.

#2 Increase Your Payments

If you’re struggling with debt, focus on one loan or credit card to pay down first. Make 
extra payments on that card. It’ll help reduce the interest you owe and a few extra payments 
each year can make a huge difference.

#3 Create a Budget and Stick to It

It’s very difficult to know how to cut or control spending if you have no idea where your 
money is going. Track your spending for a month and then use that information to create a 
budget. Review your budget monthly to make tweaks and changes.

#4 Automate

Automate as much of your financial life as possible. Automate your savings by setting up 
automatic transfers into your savings or investment accounts. Automate your bill payments 
and automate your deposits. Now, make sure to also track the dates that payments go into 
and out of your account. You want to avoid any overdraft fees. Some financial institutions and 
utility companies allow you to set your monthly payment dates. This is useful because it gives 
you more control over your cash flow.

Finally, create a cushion. Establish a savings account that is only to be used in financial 
emergencies. When you unintentionally go over budget, use the cushion to cover it and then 
rebuild your cushion. Ideally, you’ll have at least a thousand dollars in your savings account 
for unexpected financial emergencies.

Don’t let debt get you down. You control your money and your financial future. Start taking 
steps to show your bank account who is boss.

If you are in need of a program that will help increase your cashflow so you can
pay off your debt, check out

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