How can I fix my debts myself?

Before you consider bankruptcy, consider the best bankruptcy alternative:pay your debts yourself.

If you have a huge debt load this may not be possible, but if your debts are reasonable, and you have a decent income, it may be possible to fix your debts on your own.

Start by making a list of your monthly expenses, also known as a budget. To make a budget, get a piece of paper and start writing. Or, do it on your computer. Calendar Budget is an excellent personal budgeting program to help you make a personal budget. You can use our Excel Spreadsheet Personal Budget Template or download our Adobe pdf personal budget if you want to do it on paper.

Once you have a list of what it costs you to live each month, ask yourself "what expenses can I cut?". Here are some suggestions:

Car payments - cars are very expensive. If you are making loan or lease payments, and buying gas, paying for insurance, and repairs and maintenance your car may be consuming a big chunk of your monthly pay. Could you sell your car and take the bus? Or just leave your car parked? Can you car pool some days of the week? Could you trade your car in for a cheaper car? For many people this is the easiest way to save money.

Rent or Mortage Payments - housing cars are usually a person's single biggest expense. Consider moving to a smaller place, or perhaps bringing in a boarder or room-mate to share expenses.

Food - we all like to eat, but can you reduce your food bill? Consider having a "Kraft Dinner" night once a week. Make it a family event. Add a different ingredient each week. This week: weiners. Next week: use your imagination! Let your kids decide! If you currently eat out or order in more than once per week, try to prepare food at home more frequently to save money.

Go through each of your expenses, and see what you can cut. By cutting a few dollars from each item in your budget, you may be able to generate enough money to pay your debts on your own, and that's certainly the best bankruptcy alternative!