Q:  I read your book Zero Debt, and I am about to start the 30 day action plan you recommend.

I had been in a debt management plan since March.  I pay $291 a month.  It’s a 5-year plan.

But I found that if I didn’t have this bill each month, I could pay off small debts.  In other words, $300 and $200 debt, etc. And pay off my car loan which is $7600 at 9%.

I then have $500 a month to put towards the large debt.  But I’m afraid that if I get off the plan, I’ll then have about $8,000 at maybe 30%.  What should I do?

A:  First of all, do not get off of your debt management plan.  Stick to the program!

I’m so happy to find out that you discovered my book Zero Debt and want to start that plan.  But Zero Debt, remember is written as a 30-day action plan to jumpstart your finances and to teach you how to manage debt wisely.

I get you going but you have to hang in there for the long haul.  And indeed, this debt management plan is dealing with the long haul.  You indicated that your plan is in fact, a 5-year plan.

Here’s what I suggest you do though about those smaller debts.  And I realize that the point that you are probably referencing in my book, is that I said, “You don’t always have to pay off those high interest rate loan. 

You can pay off some of the smaller debts and then use the extra money that you have to put towards your larger debt.”  And that’s what it sounds like you want to be able to do.

I’d really encourage you to scour your budget, to scrutinize it greatly, to stick to that plan that you have in place, the debt management plan, and to see if you can come up with, just for two months, some extra cash on your own in order to put towards knocking out those small debts.

You want to check with the debt management plan, the company that you’re using and let them know, “Listen, I want to be able to pay these two smaller debts.  How can we arrange it so that I can pay all of these $200 and $300 balances and then take that extra money and put towards my larger debt.”

I bet you they can re-work your plan or tweak it for you a little bit.

So what you want to do if you say, “Lynnette, I’ve checked my budget and looked at everything to the bone.

I don’t have any place else that I can cut in order to put extra money towards those small debts.”  Then I would encourage you to do some other creative things.

One might be to sell stuff.  I’m always telling people, as Americans, we have way too many stuff in our houses and in our apartments.

If you just do this one step, sell stuff that you don’t want, need or use.  I guarantee you’ll raise some cash.

It might be electronics, household goods, small appliances, furniture, toys, clothing.

Any of those things that really, you’re not using anymore, you don’t want or perhaps you just don’t need.  Have a yard sale.  Have a garage sale.  Sell it on eBay.  I don’t care what you have to do.

Raise some quick cash and then maybe use that money to pay off those smaller debts.  A couple hundred bucks and then get yourself going and continuing on your debt management plan.

I hope that information helps you.