Now that you have analyzed your spending and identified areas in which you could reduce your expenses, the hard part is to make the decision to actually reduce your spending.

Certainly, if you are able to pay to make your debt payments every month, one simple solution may be to resolve not to incur any more debt. Put away the credit cards and pay cash for all of your purchases. Of course, the problem with this strategy is that you have saved nothing for emergencies. When they do occur, and they definitely will, you will find yourself using the credit card to pay this bill, and once again promising not to put any more purchases on the card. It becomes an endless cycle, one that can keep you in debt forever.

The only real workable solution is to seriously reduce your expenses, not only so you can apply some savings to paying off your debt sooner, but also to begin putting some savings into an emergency fund that can be used to pay for those unexpected expenses.

If you are like most people, you still aren't convinced that it is imperative that you reduce your expenses and pay down your debt as soon as possible. For you, we provide an interest payment calculator that will demonstrate not only how much money you are paying in interest for those loans now, but how much money you could save by paying off that debt sooner.

Hopefully, now you understand the importance of paying off your debt as soon as possible. Make those hard decisions now before you have to make even more difficult life changes down the road.

Step 4 - Develop Your Plan