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Dave Ramsey

Dave Ramsey

Host of "The Dave Ramsey Show" on Fox Business Channel and...

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Scott Bilker

Scott Bilker

Author and creator of DebtSmart.com

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Liz  Pulliam Weston

Liz Pulliam Weston

MSN Money columnist and author

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Getting to the Core

Everyone knows the credit crunch is bad, but it’s hard to know just how bad it is until it hits home. During trying times, it’s important to keep your credit score in mind as you reduce your debt.

In addition to simply paying your bills on time, not applying for additional credit and using only a small percentage of the credit available to you, The Wall Street Journal gives two other key pieces of advice to think about when it comes to reducing your debt (or at least keeping it in check.)

Your core living expenses—groceries, rent or mortgage payments, utilities and car or loan payments—should be at or less than half of your pretax income. Then you can use the other half of your money for savings, taxes and all-important vacations and entertainment.

The savings element is the most important. While reducing debt is key, having something set aside in case of emergency will go a long way in making sure you don’t go into debt again. Try some small steps to reduce debt that will help you stop spending and start saving.

Posted: 3/19/08