Forget about your credit rating – for now. Although your credit rating will be important for future purchases, what is critical is that you get a hold of your finances immediately in the present to your hanging garment bag! There is no use is worrying about your credit rating because this will only conjure negative feelings that may further discourage you. Instead you should be positive and hopeful because you have a plan of attack! As you carry out your plan to becoming debt free your credit rating will slowly improve, but for now stick to your repayment plan and you will be pleasantly rewarded in the future when your balances are ZERO!
Now that you have a positive mindset and a clear picture of your finances you are ready to plan a budget! Make a list of all your income and expenses. It may help to make a separate list of all your essentials ( such as rent/mortgage, hydro, gas, food etc) and a list of all your variable expenses (gym membership, salon, entertainment, restaurants etc). It is important here to be honest and see where you may be able to trim down i.e eat out less, work out at home etc. From here you will be able to allocate your money to paying down your debt one step at a time!