Debt Management Plan: Taking Your Debt Inventory (post 2 of 4)
As help to the American consumer we are posting a series of four post’s dedicated to a make shift do it yourself get out of debt, Debt Management Plan.
This post is dedicated to taking ones debt inventory and is the second post of a series of four posts.
Debt has consumed the American consumer for the past decade or so and is really starting to come full circle in the current economy sharing the hurt across the entire Nation. If you like many Americans are struggling with credit card debt or any other form of high interest unsecured debt this plan may be able to help you avoid having to spend extra money and risk involved in obtaining third party debt management help.
Taking Your Debt Inventory
Taking note, organizing and prioritizing a list of liabilities, the details and terms of the debt and the creditor’s information is all part of the debt management process and more specifically these activities create and result in your personal debt inventory.
Please make sure you take considerable care with this step as it will create the basis for the design that best suits your unique situation. Any mistakes will lead to mistakes in your final plan. So be careful and mindful.
- List all the unsecured debt that you have by name and amount you pay monthly
- Gather all the terms and details of such for each of the debts owed. This should include your interest rates, balance, Original amount if applicable, creditor’s contact info, any side notes you want to add such as your feelings towards and or relationship with the particular creditor, or anything that could possibly influence the importance and or priority of the debt.
- Re-organize the list three different ways or just one of the following if you insist. 1) By balance owed greatest to least 2) By Interest rate 3) size of monthly payment
- Analyze the different lists and take note of any important differences or surprises that you discover. For instance one of your credit card accounts may have a low monthly payment but a higher interest rate and or fees that inflate the actual interest or cost of the debt. Also be sure to check and see if the companies are charging you hidden fees or bogus interest rates for cash loans that were in fact regular purchases and should be charged lower interest.
- You would be smart to make this list on ex cell if you know how to use it as it is easy to sort your list by the different variables involved this also will cut down on errors if you use the math functions available. Plus it is neat and easy to store and or print.
- Add up the amounts of all minimum payments
- After you clean up and your head stops spinning go do something fun and cheap preferably free and try to recover from this boring and oddly disgusting task, so that next week you will be ready to rework your budget and prepare a new and improved monthly household budget.
- Pat yourself on the back you will now be one step closer to debt relief and financial freedom.