10 ways to destroy your Xmas debts

If you've got into debt this Christmas, don't despair. Here are 10 easy ways to get rid of it.

Here at lovemoney.com, experts like me often offer our advice on how you can get out of debt. For example, in this goal: Destroy your debts.

But today, I wanted to round up some of your top tips, from lovemoney.com readers who have been there and done that. Here goes:

1. Short-term pain, long-term gain

lovemoney.com reader damar2000 suggests cutting back on luxuries:

"Cut out expensive holidays for a few years. There are many beautiful places in the UK to discover."

It's all about temporary pain for future gain, although perhaps it's not fair to call a visit to (for example) Lancashire's beautiful Ribble Valley a pain!

2. Stop pussyfooting around it

A debtor dealing with debt and calling himself anon27 explained what he thinks is the key thing you need to do to get out of debt:

"Each person needs to think about what it is that will force them to make large repayments. What is best for one person is not best for everyone. I moved my debt around for years from one deal to the next but somehow it never shrunk. It was only when I committed to making the largest payments I could afford that it has started to shrink, and fast."

It's simple when you think about it, but, as he said, it took him years, and I think there are thousands of other anonymous debtors who do the same. If you can't find any spare money to throw at your debt, consider your options.

3. Education, education, ...? (Can you fill in the blank?)

The second of three contributions to my piece from damar2000 is:

"Maximise your income through whatever legal means. I invested a little money in some professional qualifications which landed me a promotion and a 15% pay rise. It was hard work but worth it."

That could work out at 15% every year for his working life, or perhaps more. For every £10,000 he earns, he'll earn an extra £1,500. A good way to deal with debt!

4. Sell, sell, sell!

Damar2000's final contribution is:

"Sell flash cars or other high value assets. Take a short term hit and buy a cheap £1,000 car (but go for a reliable make). Once your debts are paid off you'll be able to buy a very nice car in cash."

This is another way to temporarily cut down on luxuries to benefit in the long run.

5. Don't trust the banks

Cynicism is the key starting point for any financial research, so I felt these words from gofres in my bones:

"NEVER trust any banks that appear to be 'helping' you when it comes to access to easy money. They're a business there to make money not to be good Samaritans."

Correct for ten points.

6. Roll on!

12stringman points us to a useful tool for what he describes as "the snowballing thing". It's simply called "snowballing" and it is one of the best ways to deal with your debts.

12stringman describes it thus:

"You work out the best way to pay off each of your debts, to minimise time and interest on the debts."

...but you can read more about how it works if you adopt this goal to destroy your debt.

7. Get advice

Debt advice volunteer roziz said:

"Speaking as a CAB advisor, if you are sinking into debt, please, please, take advice early. There are manageable solutions, but they are far less painful if you consult early."

She's not just blowing her own trumpet; this is true. I recommend for debt advice National Debtline and Dealing with Debt. (Northern Ireland readers could try Debtline NI.)

8. Number crunching

If you've not used a program like Excel before, it's really not all that scary. You just fill in a few columns and add up the totals. If you use the Help function, it'll tell you how to add up the totals automatically. Ukjay recommends them for dealing with debt:

"Building your own financial spreadsheet can certainly make you focus on your incomings and outgoings, and help you adjust your spending and saving for a better outcome!"

9. The lightbulb moment

Rubbertramp explains the eureka moment that many debtors get:

"What stands out as important for me is the turning point: the clear decision to start acting sensibly and address the debt problem. Everyone's situation is different, but we make the decision to tackle the problem and new avenues are opened that we may not have realised would become available."

10. Use free resources

jacko12 had this message:

"Thank you for all the advice that helped me last year. I have reduced my debt and it's a long, hard road, but I won't be borrowing again."

There, you see? By joining the community here at lovemoney.com, you can help people to reduce their debts and eventually win free. So if you've got some tips to share, please register now to help others!

One final piece of advice

If you're still worried that you won't be able to pay off your Christmas credit card debts quickly enough, don't forget that you can speed up your debt-destruction capacity dramatically, simply by transferring the balance on to 0% balance transfer card. This will give you a year or more of breathing space when you don't have to worry about paying any interest on your debts.

Finally, when picking your comments today, I tried to make sure that many of them explained ideas that we writers haven't covered in articles this year. But don't forget to have a look through our archive of all debt articles for 2009, as there's heaps more help available in there.

Get help from lovemoney.com

If you need a bit of help dealing with debt, why not use the resources right here at lovemoney.com.

First, adopt this goal: Destroy your debt

Next, watch this video: Get out of debt

And finally, why not have a wander over to Q&A and ask other lovemoney.com members for hints and tips?

Deal a death blow to your debts by transferring to a 0% card, where you'll be able to pay the debt off much faster!

More: The top three ways to deal with debt | Eight dealing with debt tips