Each month, you dread looking at the bills and you are unsure if you need to get debt help. You know you have a mounting debt problem and you are reluctant to get debt help because you feel that you may be able to clear your debts on your own. Well, here is a guide to help you with your debt problems. There will be some steps which you could follow to try to clear your debts. If you are still unable to reduce your debts, then you may need to engage a debt management company for assistance.

In order to get your finances into order, you may need to first take an inventory of all your debts, your creditors and list out the debts with the highest interest rates. Often, the debts with the highest interest rates are credit cards. Credit cards usually have very high interest rates on the unpaid balances and the higher balance you allow to be carried forward, the deeper you may fall into debt. Once you know which of your debts are causing you to lose more money in terms of interest rates, then you will need to set aside these debts as the kinds that need to be paid up first.

Now, after taking a complete inventory, you may need to do some calculations next. You need to calculate your total income and then deduct your fixed monthly payments such as mortgage, car loans and utility bills. After that, you will have a sum of money left. Now, here is the hard part. You may need to control yourself to truly, really stop spending money on frivolous things like expensive watches, expensive shoes or even clothes. You probably need to be very strict with your spending and only allow yourself to use the money to pay for the monthly bills, necessities and finally, your debtors.

Next, you may have to get rid of your credit cards, either by cutting them and discarding them or keeping them in a place from where you may not be able to retrieve them easily. It may be wiser to always use cash for purchases so that you do not overspend, which you are more likely to do if you are using your credit cards to sign for all purchases. This habit must stop in order for you to stop running up a huge credit card debt over a period of time. Also, when you use cash, you may be more aware of your own affordability and perhaps automatically not spend more than what you can afford.

Finally, if after you try all the budgeting, credit card slashing and cutting of expenditure and yet, you are unable to clear your debts, then it is a sign that you need to seek help. You may need to get debt relief help from a third party. There can be other solutions to your debt problems other than trying to settle it on your own. One of the ways is to go for debt settlement.

Debt settlement is meant for those who have absolutely no way of paying their creditors and have probably defaulted in their monthly payments to their creditors. It is meant for those who are on the verge of filing for bankruptcy, sort of like the last resort. Through this method, debt negotiations will be undertaken to try to get your creditors to forgive part of your debts. This means your creditors may allow you to settle your debts at a 'discounted' rate. However, do bear in mind that not all such negotiations will end up successful. This method of resolving your debts is also based on your eligibility and the kinds of debts that are eligible.