7 top 'get out of debt' tips

For the majority of the population, debt has become the norm and conversations about how to get out of debt are increasingly common. If you're one of the many thousands of people who want to change their life and get out of debt, you're taking a massive step towards a stress-free, financially secure future, and here are 7 tips to help you.

Get real!

The first step to get out of debt is to admit how much money you owe. It's too easy to kid yourself you don't owe a lot really, especially if your debts are spread around on many different cards, loans and overdrafts. This can lull you into a false sense of security and you end up being half-hearted about trying to get out of debt. Until you see that total debt figure written down you won't be motivated enough to take action.

Plan ahead

Half the battle when trying to get out of debt is paying your creditors. The other half is anticipating future big expenses and having enough money in your bank account to cover them. Christmas comes once a year at the same time so start putting away some money every month from now on. By doing this with all your bigger expenses, you can even them out across the year so you have less emergencies and feel in control of your finances while you get out of debt.

Setup a separate savings account for emergencies

Some people like to have a credit card handy to cover major emergencies, but it's better to have cash handy because it's not always possible to use a card in these situations. For example, if your boiler broke down in the middle of winter how long could you go without heat while saving up because the repairman doesn't take credit cards as payment?

Don't use credit, use cash!

Fantastic plastic has made out lives so much quicker and easier – and it's made us get into debt quicker and easier too!. The easiest way to start getting a grip on your spending and get out of debt is to work out what money you need each week and then withdraw that amount in cash – and only that amount – to live on. Having a finite amount of cold, hard cash in your hand makes it that little bit harder to spend it because you know when it's gone, it's gone.

Wean yourself off the credit

Stopping yourself from using credit, particularly credit cards, is one of the hardest things to do when trying to get out of debt. Some people decide to 'go cold turkey' and cut up their credit cards and store cards. Others like to keep a credit card handy for that little bit of extra security for the unexpected. If you decide to keep one line of credit open for this reason, promise yourself it will only ever be used for major emergencies and not to go shopping to cheer yourself up after a bad day at work!

Make sure you and your other half are on the same wavelength

While you're all fired up with enthusiasm about trying to get out of debt you might not have noticed your other half isn't. In fact, if your other half has been responsible for building up part of the debt, they may not be willing to stop spending at all, resulting in them sabotaging your efforts to get out of debt.

Be creative and find alternatives

Finding cost effective alternatives to everyday items is half the battle when trying to get out of debt. i.e. instead of visiting Nero's for you usual morning coffee, make your own instead! It doesn't sound much but 2 a day on a coffee mounts up to 40 a month, which equates to nearly 500 a year on coffee! Instead of buying new books trying visiting the library or read the news online instead of buying newspapers. Invite friends round for dinner and cook for them instead of going out. There are many ways you can enjoy the same things at a lower cost.

And finally.celebrate those milestones!

On your journey to get out of debt every now and again you will reach a milestone, this could be a specific amount saved or a how long you have gone without something for. Its important to remember to celebrate these milestones with small rewards, just to keep you motivated on the journey to get out of debt. Typical examples could be, a night at the cinema, dinner at a restaurant or even something as simple as a DVD night in with your partner. Not all rewards have to be associated with spending money though, choose rewards that inevitably make you happy.

For those of us who are looking for a quick method to get out of debt there is something called an unenforceable credit agreement which may help you legally write off your debt completely.