Budgeting and Effective Processes to Eliminate Debt

Personal finance is topic we are taught to ignore in public settings and only discuss in private, which leads to situations where people are unsure how to budget, don’t know how to start a budget, or fail to realize effective ways to eliminate debt. People live with the fact that debt is always a part of their life, but that couldn’t be farther from the truth. Below are effective ways to budget and eliminate debt while giving you the best chance at succeeding. Another key to succeeding is keeping up momentum along side the budget and debt elimination methods.


They key to establishing a healthy financial life and eliminating debt is to construct a budget that gives every dollar a name and assignment. People fail to understand where their money is going because they spend without having a game plan. How an ideal budget should flow is to plan monthly, semi-monthly, or every paycheck. Before you begin spending and letting money go from your account, populate your budget and stick to it. Where people begin going wrong is when they deviate from the budget and spend their money on unnecessary purchases. Budgeting takes time to build, but once constructed can be your best asset.

Debt Snowball

An effective way to eliminate debt is using the debt snowball, which is putting your debts in order from smallest to largest no matter their interest rates. The main reason this debt elimination method works so well is that it allows you to see tangible results quicker, which gives you the satisfaction of making real progress and continuing to build the momentum needed to finish the debt snowball. Another reason this is one of the most effective methods is it allows you to allocate all of your extra finances to one debt, which maximizes the affects of your money. Once the debt is eliminated, you take the payments you were paying to the first one and roll it into the second debt, hence the name debt snowball.


Momentum is one of those factors that help you keep going in the mission to eliminate debt. Many people become discouraged because they don’t have a budget in place or they fail to allocate their money correctly, making their debts stick around longer then they need to. Utilizing a budget and using the debt snowball or a proven method that fits you can keep your momentum going, because nothing is worse than coming so far and losing the desire to keep pressing on.

People need to talk about how to handle personal finances on a more frequent basis because without the knowledge base, these tools are not effective. In order to make this work, first you construct a budget. Sit down and understand your situation and build a solid base for a budget. Mold it as you go and tune it until it becomes perfect. Secondly, implement a debt elimination process that’s effective such as the debt snowball. These tools combined will propel you in the right direction to begin in the direction of financial health.

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