There is no magical wand to manage your debts, therefore determination and exercising financial discipline can help you eliminate your financial obligation smoothly. When you are planning to pay off your debts through a debt negotiation program then you are required to keep a track of your debt you owe to the creditors. Therefore, managing your debt is a step by step process that you are required to follow to pay off your debts.
Here a few steps to manage your debt and attain financial freedom:
1. Evaluation of financial situation:

When you are planning to pay off your debts then you are required to analyze the amount you owe to the creditors. Check the bills and statement in order to prepare a list of the total amount you owe to the creditors. Make sure that you write down the interest rate on each debt as it will help you estimate the amount you owe to the creditors.
2. Curb your expenses:
If you can keep a track of your expenses then it’ll help you understand where your money is draining out. You can curtail your expenses when you are aware that you are spending recklessly. Prepare a spreadsheet where you can incorporate your weekly expenses like your entertainment expenses, medical bills and gas station bills etc.
3. Make a budget plan:
When you are working on paying off your debts then make sure that you formulate a stringent budget plan. Try to avoid dissuading from your budget plan otherwise you might not be able to get back on the right financial track. Budgeting helps you keep a track of your expenses and refrains from spending beyond your means. You can save considerable amount of money and this extra money can be used for paying off your debts.
4. Assessing the available options:
Make sure that you choose the available debt relief options you have to eliminate your financial obligations. Try to select a program that will be in accordance with your financial situation. If you enroll in a debt management program then the debt arbitrators will negotiate with the creditors to lower the outstanding balance to make it affordable to pay off. When you settle your debts then you pay less than you actually owe to the creditors.
5. Take assistance of a counselor:
If you hire the services of a debt counselor then he’ll suggest a debt relief plan after reviewing your financial situation. A counselor can organize financial education classes so that you avoid getting into debt in future. He’ll give you financial tips to manage your finances effortlessly.
6. Debt avalanche method:
Prepare a list of the debts you owe to the creditors in descending order of the interest rate. Start making payment on the debts with higher interest rate on top of the list. In the mean time, make minimum payments on the remaining debts. Make sure that you continue this process unless you pay off your debts completely.
Therefore, these are the effective six ways you can manage your finances to wipe out your debts.