Debt Payments Higher Than Income

July 7, 2008

If you're new here, I invite you to subscribe to my RSS feed. Thanks for visiting!

This is part of our Pay Debt Quickly series sponsored by
PDQ Pay Debt Quickly kit.

Too Much DebtQuestion:I don’t know how to pay off my debt. My debts are more than the money I earn each month. What can I do? ~ Naomi

Answer: Hi Naomi, that’s a tough spot to be in. I’m not quite sure from your question if your total debts are higher than your monthly income or if the payments are higher than your income. I’m going to address that your debts are higher than your income but you’re still able to make the payments.

It sounds like this is really worrying you — maybe that you won’t be able to make the payments soon. So, now is a good time to be asking this question.

Since you can make the payments, every month, you’re actually in a good position to be able to eliminate the debt over the next couple of years (perhaps sooner). Here’s what to do…

  1. From Minimum Payments to Fixed Payments. Convert all your current minimum payments to fixed payments. That means that if you are paying $55.55 this month, you’ll pay that every single month until the debt is paid off — no matter what the minimum payment is on your bill.
  2. Stop Using Your Credit Cards. There’s  no grace period on cards that have a balance so you start paying interest on new charges immediately.
  3. Get Clear on Your Debt. List every one of your debts on a piece of paper (you can get my form here) so you know exactly what you’re dealing with. Sometimes it’s worse than you thought and sometimes not so bad but you won’t be able to really know until you see it all in black and white.

If you’d like to instantly create a Debt Payoff Plan and see exactly the date you’ll be out of debt, try our PDQ Pay Debt Quickly system (with a 30 day no-questions asked guarantee). It’s great to have a plan that you can follow every month.

Naomi, please let me know if you have any other questions.

Warmly, Cindy Morus

Posted by Cindy Morus | Filed Under Debt 

Similar Posts

Comments

Got something to say?