Are you feeling overwhelmed with debt? Worried about how much you spend on interest each month? Lowering the amount of debt you carry can significantly improve your credit profile, reduce potential loan rates, and save you a lot in interest.
It just takes a few easy steps and a little dedication to take control of your debt.
If you’re serious about saving money for your down payment, you might have to hold off on unnecessary spending for a while. Eating out, family vacations, unneeded shopping, and new electronics are just a few areas of wants—not needs—where you might be able to cut back.
Creating a budget is probably the best way to see where you’re spending your money and what you can cut.
Here are 4 ways to create your budget:
- Write down your total monthly income and list your estimated monthly expenses.
- For the next month, keep all your receipts and track your actual spending.
- Compare your budgeted expenses and your actual expenses for that month.
- Adjust your future spending to match your budget.
You might be surprised at the difference between what you estimated your expenses were and what they ended up being. Now that you know how much you spend, you need to see what can go. Be ruthless. Or if you end up having more money than your planned expenses, start redirecting more money to paying off debt.
Here are some other great resources for creating a budget: