Debt Reduction Strategies
The following tips are designed to help you reduce your debt quickly and
1. Create a Budget and Stick With It. Your budget should include all of your
current expenses. Request a copy of the Personal Budget Planner for more
information on creating a budget.
2. Don’t Borrow Additional Money to Pay off Debts or Bills.
3. Cut Expenses. Get this number by analyzing your budget and determining
where reductions can be made (e.g., eating out, buying snacks and lunch at
work, going to the movies, etc.). Once you have determined how much you
plan to cut, use this “found” money to pay down the balances on your debts.
4. Optimize Your Monthly Payment. Pay the maximum amount towards your
highest interest rate debts. Pay the minimum amount on all other debts.
5. Ask for Reduced Interest Rates. Some creditors, especially credit card
companies, will reduce your interest rates if you just call and ask. If you
receive offers for other credits cards with lower interest rates in the mail, use
those offers as leverage when you are re-negotiating your rates with your
6. Set Goals and Priorities. Determine what’s important. When you prepare to
buy something ask yourself if this purchase is in line with the priorities you
have set and will it help you reach your goal or delay it.
7. Check out the website: http://www.quicken.com/saving/debt/
This site provides a free Debt Reduction Planner that allows you to determine
the amounts you should be paying towards each of your debts and calculates
the money you will save by paying your debts in the recommended order.
Additionally, the program tells you when each of your debts will be paid off.