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When your debts have become too steep to deal with, you need a plan to get out. The 8 steps covered in this article are tried and true ways of doing just that.

1. Know Your Debt Relief Options: Hardship Assistance, Debt Consolidation Loans, Debt Agreements and Bankruptcy. It’s important you know the pros and cons of each option so you can decide if one of them is right for you. For instance, hardship assistance is great for short term debt relief and doesn’t leave you with a 7 year notation on your credit file like a debt agreement or bankruptcy. However, if you can’t meet the repayments long term it’s not going to get you out of debt. A Debt Agreement is great when you’re in serious debt stress and can help you avoid many of the penalties of a bankruptcy. However, it’s not an option when you have more equity in a home than is needed to pay off the debt. All these options can be a minefield when you’re starting out, so it’s a good idea to talk them through with a debt expert.

2. Use Snowballing. This is a method under which you pay off your debts in order from smallest to largest. The main benefit of this is motivational. You get the psychological reward of paying off more debts in a shorter space of time which gives you momentum to deal with the bigger debts.

3. Write out a budget so you know what you’re spending on and how much you have coming in. A lot of times people get into trouble because they lost track of where they’re making losses each weeks – eating out, expensive weekends, alcohol. A budget will help you figure this out.

4. Start swapping. Look for areas in your life where you can swap an expensive choice for a less expensive one. For instance, making your own lunch 2 days week, watching movies at a cheaper theatre or getting your haircut at a cheaper location. Whilst you might have to cut out some expenses entirely, there are others where you may be able to get away with just substituting with a cheaper option. Swapping also makes your budget more realistic and achievable, meaning you’re much more likely to stick to it.

5. Call your creditors. If you’re falling behind in your debts, your first act should be to call the people you owe and try to work out a repayment plan. Explain to them your difficulties and how you intend to bounce back and then work out an offer that suits.

6. Hold a sale. You can bring in a quick injection of cash by selling all those items you don’t use anymore. Try selling direct to the public or a second hand retailer.

7. Only pay with cash. Buy the things you want with money you have in the bank – not with credit cards. And if you can’t afford it right now, just keep saving until you can.

8. Try another bank. In all likelihood, whatever offer you’re receiving from you present lender, there’s probably another lender out there that could offer you a better deal. So feel free to shop around and long at what offers are out there. Consider interest rates, fees, switching costs and other features of the loan being discussed and being careful to distinguish between attractive introductory offers and genuine long term value. It’s the latter that will really save you dollars.

Debt problems can be very difficult to deal with and emotionally draining. However, if you follow these 8 steps you’ll be well on the way to getting on top of your debts and finally getting back your quality of life.

Want to find out more about Debt Agreements and other debt relief options, then visit Graham McDermott’s site on how to choose the best debt relief solution for your needs.