To develop a plan for reducing your debt, first determine your debt load – the total amount you owe. Take a few minutes to collect all your bills and credit card statements to take inventory. On a piece of paper (or using the debt load worksheet in the resources below), write out the following:
- Name of creditor
- Current balance
- Interest rate
- Minimum monthly payment
Add your current balances to determine your debt load. WARNING: If you have never taken this step before, the number could come as a shock. However intimidating your debt load seems today, be encouraged that you are taking the first step toward financial freedom!
- Debt Load Worksheet: Document your debt balances using this debt worksheet from the University of Nebraska at Lincoln
- Debt Test: Do you pass?
- “How healthy are your finances?” What was your grade? Let us know!
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