Debt reduction can be a tough topic because for many readers here there is no extra money to put towards the debt. In fact, today many of you may be using credit cards to pay normal monthly bills to avoid foreclosure on a home or to keep the utilities on. Where does extra money come from when you have debt to pay down?

Extra groceries and snacks that are not essential can be a big change robber too. I am right there with you on this one. I spend too much on pop, too much on snacks and fast food, and too much on candy for lunches or for fast pick me ups when I am rushed and get the hungry bug.

The idea of debt reduction for today may be as simple as paying the minimum balance on all of your bills but this is NOT a long term solution. The debt reduction solution is to find ways to pay off the debt but you may have to start small.

In previous posts we have discussed making  a budget and listing all of your expenses along with all of your income. Your list of these items is essential to looking clearly at what needs to be done to get the debt reduction started. And you do have to start somewhere.

Your assignment for this week is to look at the lists you have made and pick the smallest balance or debt you want to get paid off. We will start small so we can see progress. I am doing this right along with you so don’t feel like you are alone in this struggle. And it is a struggle to reduce debt, but the freedom you will feel after the debt is gone will be tremendous.

So study the lists and pick your first debt that you want to tackle. Mine is an 808.00 balance on a sewing machine. The minimum payment is only 31 dollars. The balance at 12 percent interest would take about 29 months to pay off if I only pay 31.00 and I would be paying 97.00 in interest. My goal is to pay this off in less than 3 months or by May.

Set the same kind of goal for yourself. Pick the smallest debt and set a reasonable goal for paying this down. We will talk about how to do this next time.