Debt payment is one part of your life.  It does not drive it.  You are in the driver’s seat because guess what? You have the money.  No one can make you give them money you do not have, or force you to pay money you do not wish to pay. Unless they take you to court.  And even then, the judge will check over your income and other expenses, and not make you pay more than you can afford. 

But, your debt information needs to be clear and easy to find. Hence, we come to the Debt Binder.  Lots of creditors will try to make you say or do what you do  not want to say or do; also, some creditors will tell you they did not say what they did say.  Hence, the Debt Binder. For low tech use, this is simply a 3-ring binder with three-hole punched paper.  Also, section dividers.  Yes, you are back in dreaded school. Stop chewing gum.

If you are high tech, there are programs which help you divide up your debts into sections and where you track what you promised to pay and what creditors promised they’d do. Since the simple method transfers to the high tech, and is simple,  I suggest you start here. Then, if you want to go techie, use your paper info to set it up. Less frustration.

Start by creating Section 1, Debt Summary, a page(s)  which lists of all your debts and their details.  That info would be  the name and address of the creditor, the total amount of the debt you both agree is yours*, the interest rate they are charging, the payment date they expect, and the amount of the payment you have decided you can afford.  Note, that is not the amount they want, hardly ever.  But, as part of your balanced Spending Plan, it is the amount you can afford.  If you pay it on time, month after month, you will give them the confidence that they will get back all their loan, in time. They’ll calm down.

Back to the binder.  After you have a complete page(s) of the debts you owe, begin Section 2, Individual Creditors. Create a sheet for each On Page 1, state the name of creditor, the contact person you talked to, the date, and a summary of what was agreed upon, and the date promised to complete the action. Put the creditor sheets in alphabetical order for easy access.

 On Page 2 of your individual creditor sheets, put the details of the debt and a running balance.  You list the total debt amount, the payments you’ve made, the date you pay, how you paid, like check or e transfer, etc, and a descending balance where you subtract what you just paid. Then watch the total debt slowly disappear. How lovely is that! 

Do not throw out those sheets once you’ve paid off the debt.  Section 3, Retired Debts., is a summary list of all debts which have been paid off in full. Create one summary sheet to which you list each debt retired and the date it was finished. You can even subtract that amount from your overall debt total, and watch that thing melt away.  And you can also keep the individual creditor sheets of debts retired in this section, in alphabetical order. This section will be all the encouragement you need to keep on keeping on.

Eventually, you will have no debts owing. And because you have not created any new unsecured debts, with the help of God, you will be debt-free, no kidding.  In the meantime, while you repay debt, you will also enjoy your life, and the reduced stress of having a balanced Spending Plan which  is funding debt retirement in balance with all the other needs and wants in your life. Debt repayment may be slower than everyone would like, but soon, you will be out of debt, and you will not have felt deprived during the process.  That is God at work, honey. 

God, please help me to organize my debt binder making debt repayment records easy to find and easy to understand, and a happy record of freedom from bondage. Yay! Thanks.  

.*You do know how to negotiate your debts to reduce them, don’t you?  Honey!  it can be done, will be done and must be done to be fair to you, and your creditors.  Read the post on Negotiating Your Debts for All Around Fairness. 

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