How to Budget Your Way Out of Debt

While so many are unemployed and the situation is worsening the debt crisis hitting families is becoming more unsustainable. Governments say they want to create employment but they have no way of stopping companies from moving offshore or from ceasing to exist.

This is having a huge impact on all countries and the introduction of robots to do the work of humans is causing the frustration that many in debt now feel.

It is one of the most painful times in someone's life when they cannot pay the bills and suffer shortages of essential items, even food. While privatisation of resources is another cause of debt companies are demanding higher fees for services provided.

There seems to be no end to the vicious circle but there are some things that people can do to make ends meet. Short of cutting out all non-essential items one of the things that really helps is a budget. One must write it on paper to show how much comes in and what goes out.

An account ledger is a good place to start. On the left hand side list all monies coming in while on the right hand side all the money spent. That includes groceries, bills, and other things. The aim is to get a balance between the two sides.

Once everything is listed work out ways to pay the bills over a longer period. Instead of paying the full amount at once ring the company involved and stagger the payment over two to three income periods. That way one can be paying off the majority of debt without stretching themselves too far.

If unemployed and there is no income, then that is a different matter. One has to apply to the government for the dole and use charities to help pay the bills. The main thing is good management and that can only be achieved when things are written down and the ledger is balanced.

Under normal circumstances it will happen that things will come right. Slowly over time and with determination to pay less for things and even to put a little aside each payday for emergencies the debt will be dissolved.

It's a self-discipline exercise as well as restraint against spending on things that can be put off until another time.

The golden rule is not to use credit cards and never buy anything unless you can afford to pay cash for it. (EA)