It’s not a pretty picture.  Mounting debt can leave one feeling helpless and depressed.  Your back is against the wall and you have nowhere to turn to for help.  Sound familiar?  A lot of us have or are there right now.  But, there is hope.  Here are four steps you can take to get yourself on the road to financial recovery and fast.

1 Track Your Expenses.  You must do this first before you can begin to make wise choices about where your money is going.  Write down each and every expense for a whole month no matter how small it might seem.  What you will find is that you spend more money on frivolous things than you realize.  This will be an eye-opening experience.

2 Create a budget.  Now you can use your expense information from the first month to create a budget.  Create categories into which money will be placed from your income.  These categories will have names like housing, automobile, insurance, food, medical/dental, utilities, savings, entertainment, vacations, health care, etc.  Also, make sure you include a small amount of money for those impulse items you like to purchase.

3 Increase your savings.  There are three things you should focus on here.  First is an emergency cash fund.  This will be around $1,500.00 or so in order to cover those unforeseen emergencies, like the car breaking down, or the refrigerator going out, etc.  Next is a savings account into which you will accumulate money for income replacement in case of a medical or income loss need.  You will want to aim for three months of income in this account.  Finally, is your long-term or retirement account.  Saving as much as you can into this account is wise if your employer has a matching plan.  Finally, make savings an automatic task.  Find out if your employer allows you to deposit your paycheck via direct deposit into one or more accounts.  This way, you can allocate money into a savings account without ever having to touch it.

4 Clean up your credit.  If there are lingering items on your credit report that are keeping your score low, work on getting rid of those.  This will help if you find that you need to apply for a mortgage or auto loan.  You will get a much better interest rate which will save you money.

If you work on these items, you will slowly begin to see some changes not only in the amount of money you have, but in your attitude towards money as well.  You will begin to see it as a tool and not a task master.