Ask for a raise or, if you're self-employed, raise your rates. You might even consider getting a second job. Even an extra $100 per month can make a significant difference in your ability to pay off debt quickly.

TAKE ACTION!

Grow your income by:
• downsizing on your big-ticket items
• selling off some of your assets
• earning more money

Debt Diet Step 7: Prioritize your debts and increase your credit score.

Secure debts - or those backed by your assets - are your top priority. Student loans and child support, for instance, are debts for which your wages can be garnished if you fail to pay. After you see to your secure debt, the next most important debt categories are services that you need to continue using, such as paying medical bills if you have a chronic illness. After those are taken care, you can then focus on unsecured debt, like your credit cards. Finally, pay back debts to family and friends. Hopefully, they're more understanding than your other creditors.

Your credit score is an important piece of information that can affect how much money you can borrow and what kind of interest rates you'll pay, among other things. In general, these are the factors that affect your credit score:
• 35% – How well you pay your bills
• 30% – How much credit you have available to you and how much of that credit you're using
• 10% – How recently you have opened (or inquired about opening) new accounts
• 10% – The percentage of your file that is bankcard debt vs. the percentage of installment debt
• 15% – How long you have had the cards

Here are some steps to help improve your credit score:
• pay your debts on time
• pay off as much credit card debt as possible, so that you're not using any more than 20%-30% of your available credit
• stop applying for more credit, unless you're shopping for a mortgage or car loan
• it's good to have at least 1 credit card that's over 2 years old, so don't cancel all your old cards

TAKE ACTION!
• pay off secured debts first
• understand what your credit score is and what areas of your life it affects
• boost your credit score using the tips above

Debt Diet Step 8: Understand your spending issues and save.

One of the keys to getting out of debt is to stop creating more debt. Different people shop for different reasons. By understanding your personal motivations for spending money, you can train yourself to spend less.

Reasons for spending:
• Entertainment
• Mood repair
• Habit
• Impulse
• Compulsive behavior

Once you understand your spending issues, you can begin to save. In times of financial crisis, it is good to have a stash of money saved up so you don't have to fall back on credit cards (and go further into debt). Start out by saving 3%-4% of your income, and eventually work your way up to 10%. Put your savings in a safe place, such as a high-yielding money-market account. Once you have accumulated 3-6 months worth of salary, you will have a good emergency cushion to help you through rough times. Everything you save beyond this emergency cushion should be invested in a portfolio that can help you grow your money over time.

TAKE ACTION!
• understand why you spend
• modify your spending behaviors
• save money to create an emergency cushion
• invest your savings and build a foundation for future wealth

America's Debt Diet: "What's for Dessert?"

Oprah’s Debt Diet has taken America by storm. Since originally aired, and reinforced with each new part of the series, millions of Americans are taking the steps necessary to begin their path to financial freedom. No matter how you decide you need to go about it, it is critical that those who need help start now!

The techniques taught in the Debt Diet are very powerful and can help a lot of America relieve the pain of their debt. It’s important to keep up these good habits no matter what you do. However, for many families out there, it just is not enough. Many families have already “trimmed the fat.” Anymore and they would not eat. Many families are not able to get their interest rates lower. Many families have lost income or a spouse’s income and simply can no longer afford to pay for the debt they have already accrued.

• What if these steps are not enough?
• What other options exist?
• How can you gain the advantage in a financial hardship situation?

For people in these situations, the Debt Diet just isn't enough. It may be time to start looking for other information on debt relief to help you get free from your debt. Hopefully, you will take advantage of the special "secret sauce" we've shared with you here to make your debt diet more successful and enjoyable!

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