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"And if you are untrustworthy about worldly wealth, who will trust you with the true riches of heaven?" (Luke 16.11).

Nine Steps to Paying off Debt

1) Discover Current Financial Condition; 2) Set Your Goals; 3) Get Organized; 

4) Reduce Expenditures; 5) Earn More Money; 6) Establish a Budget; 7) Put

 Aside Emergency Money; 8) Prioritize Your Bills; 9) Praise and Thank God

      Are you tired of all the bills and no money left at the end of the month? Do you want to lighten your financial load and simplify your life? Then pay down your debt and reduce the number of bills you juggle each month. With the following nine-step approach, you too can dig your way out of debt.

Step One – Discover Your Current Financial Condition

      Have you ever said, “Where’s all my money gone?” Take the time to answer this question today. First, figure exactly how much money is coming into your household in any given month. Add up all your paychecks, child support, benefits or any other income.

      Next, figure your expenditures. How much money are you spending? Write down all your expenses like utilities, phone, groceries, gas and all the monthly installments on your debts like the mortgage or car loans or credit card minimum payments. Also, include your monthly medical or insurance payments, donations and memberships. Think hard about every area that costs you money. Add all your expenses.

      Now compare the amount of income to the amount of money going to your financial obligations. If your income is higher than the expenses, congratulations, you make enough money to pay your bills. If the expenditures are higher, however, you’re living beyond your means.

Step Two – Set Your Goals

      After figuring your current financial condition you have a better idea of where you’re at right now, but I doubt if that’s where you want to stay. Goals give a new direction to your life. Here’s what to do:

·         Decide exactly what you want.

·         Set a deadline to accomplish it.

·         Create your own plan to move you forward and start putting it into action right away.

·         Put it in writing. Include what you’ll do in return when you reach that goal.

·         Read your goals at least twice a day.

·         Once you accomplish a goal, reevaluate and write new goals.

Step Three – Get Organized

      Determine one place to store all incoming bills. That way you have less chance of missing a payment. When paying your bills, write your account number on your check or money order. For a credit card payment, only record the last four digits to protect your account. Put a “pd” and the date on the customer portion of the statement and file it.

      Organize your checking account and record and keep a current balance of all your transactions to avoid overdrafts. Reconcile your account when the statement comes from the bank.

      Keep all your important papers, statements and receipts in a file drawer or box.

Step Four – Reduce Expenditures

      Look at all the expenses you recorded from step one. Which of these are merely conveniences that you can really do without, at least until a few bills are paid in full?

Step Five – Earn More Money

      You can go about this two ways. Either get a second job or increase your current income.

      Keep in mind that a second job could cause problems such as:

·         Moving to the next tax bracket.

·         Keeping you from overtime hours.

·         Increased babysitting expenses.

·         Less time to make nutritious meals.

·         Temptation to take on more debt.

·         Less time with those you love.

You can increase your current income.

·         Watch the company bulletin board for promotions or better paying positions.

·         Volunteer for overtime work.

·         Learn a new skill.

·         Take night/weekend classes.

·         Ask for a raise (if you do a good job.)

·         Change careers.

·         Hold a garage sale.

·         Use a hobby to make extra money.

·         Sell any collectibles/antiques, but not if they hold sentimental value.

Step Six – Establish a Budget

      A budget is a plan to manage your money, control the family’s spending and prepare for your future. Just as a road map guides your way to a destination, a budget gives direction to your financial goals.

      Remember the phrase, “People don’t plan to fail, they fail to plan.” Planning your budget is a very important decision-making process that should include your spouse and even your older children. Schedule a planning session to determine how the money will be spent or saved, and do it every month.

      Before preparing the budget, keep a spending diary to discover exactly where you spend your money outside the monthly bills and loans. Before you can plan how much money to allocate for groceries you first need to know about how much you currently spend.

      Next, choose a way to budget that’s right for you. Different plans work for different people. You can use the form method, the calendar method, the ledger method or the envelope method. Each has its own advantages.

Step Seven – Put Aside Emergency Money

      Is this you? Just when you think you’re back on track, something breaks down or comes due. In the past the temptation may have been to use the credit card thinking that you could pay it off next month. Only next month comes and a new need arises and now you’re paying interest on top of everything else.

      Once you’ve caught up on all your payments, but before you begin focusing on your priority bill, put aside some money in a savings account. The amount could be anywhere from $500 to $3,000. You decide your level of security.

Step Eight – Prioritize Order of Repayment

      Once you’ve brought all your accounts to a current status and established your savings account, it’s time to begin attacking the bills one bill at a time. The plan is to apply any extra money toward one bill while paying the minimum payments on all the rest.

      Where does this money come from? You’ll free up a lot of extra cash in step four when you reduce your expenditures. If you bring in any extra income from step five be sure to use it to pay down the debt.

      List all your debts on a single sheet of paper. Divide the page into columns: pay-off priority, name of creditor, total amount owed, monthly payment amount, interest rate, extra payment and pay-off date.

      Now you have some decisions to make. Look at the list of debts and decide which one is the most important debt to eliminate. Which should be paid off next and so on? You may choose to pay off the smallest bill first and cancel that debt quickly. It’s a surefire way to prove you can do this and build your confidence.

      You may decide to go after the credit card with the highest interest rate. At 23% that high rate is eating away at your prosperity and once paid, it’s like receiving a 23% return on your investment.

      It’s possible that you owe money to your parents or others who are also struggling. Maybe their situation has become worse than yours. You may decide to pay this bill first while paying the minimums on all the others.

      You decide. It’s up to you which bill to pay first, second, third, and so on.

      You may choose to record your payments in a ledger. It can be very encouraging because you see the bills decreasing with each payment. It also becomes a memory book of how far you’ve come.

      Choose to pay off your debts one at a time rather than consolidating. Putting all your debts into one loan can take the pressure off enough to actually encourage more spending. Bad spending habits need to be addressed. Paying off one bill at a time and gradually relieving the pressure can teach valuable lessons.

      Be sure to pay only the minimums on all other bills while putting all the extra money toward your one priority bill.

      Once one or two bills are paid in full, you may feel like you have lots of extra cash. The temptation is to finance something else new, but remember the goal is to pay all the debt down.

Step Nine – Praise and Thank God

      It is God who gives you the ability to make wealth, and it is He who will help you get out of debt. Thank and praise Him for every blessing.

      Check out the G.O.O.D. Store for tools that can help you every step of the way.

·         The Financial Tool Box

·         The Financial Fitness Workshop on tape/CD

·         Budget Materials

·         Educational Material

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