Seventy-three percent of U.S. households use at least one credit card,and roughly half carry a balance,with a median bebt of $3,000, according to the Federal Reserve's 2007 survey of consumer fiances(the most recent data available) here's some ways you can live debt-free
1.do some self-reflection about why you want to become bebt free (if you are married or living with a partner,include him/her.Then ask yourself if you ever will really need a credit card (keeping in mind that they did not exist until the 20th century.) If your answer to this last question is "no", then you are ready to get out of credit card debt and stay out!
2.Cut up and throw away all of your credit cards.cutting up the card does not erase your debt, however, you still have to pay that).
3.Step3 The math skills required for a good budget are minimal! Calculate how much you (and your spouse/partner) earn each month, and with a pencil and paper write down all of the things you HAVE to pay for (food, utilities, rent/mortgage, insurance, gas for the car, any medical expenses, clothes, and minimum debt payments) A monthy car payment, digital cable TV, and eating out at a restaurant are not NEEDS (a car payment is a debt, not a need).
Account for EVERY dollar after taxes. If you are a religious person, account for the amount of money you are expected to contribute to your faith. When you have accounted for all of your necessary expenses, you have just written a budget that is easy to read and practical to follow.
4.Make minimum payments on all of your debts, and apply every dollar that is not NECESSARY TO SURVIVE to the creation of a $1,000 emergency fund. It is best to place the cash in a readily available, interest bearing account (stocks, bonds, escrows, etc. are NOT readily available; you should be able to get the cash immediately if there is an emergency--remember, you are trying to eliminate the need for a credit card and replace it with available cash).
5.List all of your debts (exception given to your home mortgage, if you have one) from smallest to largest, and take as much as possible of the "free" money in your budget and DESTROY THAT DEBT! (meanwhile you have to do two things: make minimum payments on everything else, and temporarily give up all of that "extra" spending).
6.Once you have paid of your smallest debt, proceed likewise to apply the same amount of money to the next smallest debt, plus whatever the minimum payment was on your last debt. If you continue this progression, the amount of money you can apply to your debt payments will continually increase until you are paying off your largest debt in sums of money so large you couldn't concieve of being able to pay them!
7.Once you are finally debt free, take ALL of the extra money in your budget each month and create an emergency fund of 3-6 months of living expenses. The purpose of this is so that if there is an emergency such as a car accident, house fire, surgery, etc., you will NOT have to use a credit card and pay it all back for years to come with 18% interest! You can just take the cash out of your fund, pay the debt, and move on (but just make sure you pay back into your emergency fund).