If you are going to try to dig yourself out of debt without filing personal bankruptcy or making a consumer proposal you need to have a plan. The best approach is to arrange all of your debts in order of interest rate charged. You want to pay off the highest interest rate debts first. One of the biggest mistakes people make when they are trying to pay-off their debts without any professional assistance is that they pay each creditor a little bit. The problem with this approach is that payments quickly get eaten up by interest charges. By paying off the highest interest rate creditors first you maximize the effectiveness of your payment.
As with any plan the key is to monitor its effectiveness. You have to make sure that you are actually getting out of debt. The best way to monitor the effectiveness of a debt repayment plan is to take all of your bills each month and add up the total amount that you owe. You need to see that your total debt is decreasing month over month. If you find that despite your best efforts your total indebtedness is not decreasing then you should review your situation with a licensed trustee in bankruptcy.
-Chris Welker
