Once you have determined that it is time for you to leave debt behind, one of your first tasks must be establishing a realistic debt payment plan. A repayment plan will keep you financially manageable so that you can continue to work towards financial freedom. Not only does a repayment plan enable you to stay on track, but it also helps you remain motivated as you will be able to monitor actual progress. Here are five tips that will help you make the most of your debt payment plan:

Be realistic with your debt. Instead of spending more than you earn, determine how much extra money you have to spend each month and allocate that to your debt repayment plan. Don’t spend more than your income because you will be incurring interest costs. The key to making this work is to set aside a portion each month for your debt payments. This will allow you to reduce your total debt without incurring any extra costs.

Consider getting part-time employment. Even if you are able to leave your job when you start a debt payment plan, there may be certain times of the month that you just don’t earn enough money. If you are employed, then you may want to think about getting an extra part-time job so that you have extra money. You may even find that you can increase your income enough to bring yourself out of poverty.

Create a budget. Your budget will serve as your guide to determining how much you can afford to spend every month. As you set your budget each month, you will be able to monitor how your income changes and how your interest rate affects your debt payment schedule. By creating a budget, you will be better prepared to handle unexpected expenses or sudden changes in your financial circumstances. To learn more about budgeting, you may want to visit local community organizations or spend some time on the Internet.

Make sure you know who your creditor is. Before you contact your creditor, you will need to obtain his or her contact information. To learn more about debtors’ rights, you may want to visit the website of the National Consumer Law Center. On the site, you will find a list of companies that are prohibited from collecting fees from consumers who don’t owe the money.

If you think your debt will be easy to handle, then you probably won’t need a debt management company. You may be able to manage your payments yourself, but you may also want to consult with a credit counseling agency to find out whether you should go with a consolidation loan to pay off your creditors. A consolidation loan can help you by extending your monthly payment amount. However, many consumers have found that this type of loan does little to improve their credit rating. In fact, many people end up worse off than when they started.

Some people, while they’re juggling a lot of debt and trying to make minimum payments, find that it is beneficial to contact a debt consolidation agency for assistance. The agency can help negotiate with your creditors and arrange for you to have lower interest rates and a lower overall debt amount. You will likely have to agree to pay a portion of your agency’s fee, but in most cases this is a very small portion. Once you’re settled into a debt consolidation program, you can often start making your payments automatically.

Whatever you decide to do, you should always stay vigilant. Be sure that you keep track of your creditors and regularly review your budget. If you find that you have more money than you initially thought you did, don’t hesitate to use it. Remember that if you’re having trouble paying your bills, you have options.