Getting into debt is just too easy and this could not be more evident then it is
right now considering the debt we are in. I read in a financial article that the
average American has $8,000 worth of credit card debt. This completely blew my mind
and I couldn’t understand how anyone could ever get themselves into this kind of
trouble. It was obvious to me that these people were not responsible with their
money because no responsible person would take on this kind of debt.
Well, then reality set in for our family and I began to realize just how easy it
is to get myself into debt. My husband lost his job and we had some money saved,
but not enough for our family to live off of for any length of time. I returned
to work and we continued to try and keep our debt ratio under control. Then we moved
and my husband took a job that did not pay as well and I was staying at home and
suddenly before you know it, we are in debt. I am sitting at the kitchen table crying
because I have no idea how we are going to pay our bills because we are overdrawn
on our bank account and out of the corner of my eye I see my salvation. This salvation
takes its form in something that looks like a check that I can now make out to myself
and make everything in my life right again. This check allows me the credit limit
of my dreams and I think why not? What would it hurt? Well, that salvation was no
salvation at all, but a trap for a desperate woman like me to get myself into some
So what does one do if they get themselves into debt and how does one ever see the
light at the end of the tunnel? I would love to say that my story ended happily
and that we are now living debt free, but that would be untrue. We are
to pay that debt off, but I will tell you that through careful research, I am now
trying to make this situation right. Here is what I have found…there is no quick
fix and it takes a strong person to get themselves out of debt. You have to be very
committed to get yourself out of debt and you also have to have everyone around
you support you in this decision. Here are a few quick tips that I have learned
through my research.
Make sure to check out my other articles
on living within your means. I wish you much luck in accomplishing your goals in
reducing your debt.
- Bankruptcy is not a quick fix. Now this is what I have heard, but what I have witnessed
has been the exact opposite of this. I know I am not the only person in this world
who has seen someone declare bankruptcy and then you notice that they have a better
car and better clothes than you do. When I see this, I honestly believe that bankruptcy
sounds good to me. This looks much better than the struggling I am doing right now,
but experts disagree with this theory. Bankruptcy will stay on your record for ten
years and it can affect your ability to get a job, credit, a new home or apartment,
and insurance. This should definitely be your last step, but I say this first because
many people jump to the conclusion that this is there only option. This is not your
only option, but choosing other options requires hard work and dedication on your
Begin with the ceremonial cutting of the cards. Pick the card that you want to save
for your emergencies and cut up all of your other cards including the department
store cards. By cutting these up you can rid yourself of those temptations. I do
not remember where I heard this before, but I thought it was a wonderful idea. Someone
gave me some great advice about what to do with your emergency card once. She said
to put this emergency card in a freezer bag full of water and stick it in the freezer.
Now if you ever think you have an emergency where you need the card, it will
require you to wait several hours to allow the card to unthaw before you can use it. This
will really put the whole “emergency” into perspective and give you time to reconsider
your decision before you go out to make your purchase. I thought this idea was brilliant
and worthy of sharing.
- Make sure that you are getting the very best rate on your credit cards. A couple
of places to check are
LowerMyBills or Bankrate
for comparing credit card interest rates. Beware of the teaser rates! I know how
tempting a 0% for six months can look, but if your interest jumps to 22% after the
teaser rate is over, then the rate really is not that great. Look for cards that
offer a low rate overall and always read the fine print on balance transfers, fees,
and introductory rates.
- Try to pay over minimum balances on your cards to reduce your balance. If you have
debt on more than one card choose your battle picking the card with the highest
interest rate. I am no math expert so I cannot offer insightful advice on specific
dollar amounts of savings over the course of ten years, but I will tell you that
the more you can put towards your debts the better off you are. It is not good,
however, to sacrifice your mortgage payments, car payments, or utilities just to
try to work on one debt. You don’t want your credit rating to go down the tubes
in the meantime. It kind of defeats the purpose of paying off your debts. You can
give up that morning coffee or any other extra perks and try to put that money that
would have gone towards something more fleeting towards something more permanent.
- If you find yourself struggling to make even the minimum payments it is now time
to put on the charm and see what you can do to make the situation easier on yourself.
I would begin with a call to your credit card company.
Explain to them that you
love being their customer and want to continue being their customer, but noticed
that another company was advertising a lower rate and you were wondering if they
could match it. This company wants to keep your business and the worse thing that
they could say to you would be no. Chances are that the credit company might consider
matching the rate and that will make things much easier for you in the long run.
- Consider getting a home equity line of credit or taking out a second mortgage to
pay off your debts. Make sure that this works out to your benefit though especially
since using your home for collateral is a very scary thing. Make sure that you do
your own research on both interest rates as well as the risks involved for taking
such a step. A couple of great places to look to compare interest rates are Lending Tree as well as
- There are wonderful nonprofit credit counseling agencies out there who would be
happy to help negotiate your debts on behalf of you. They contact the people that
you owe and work out a payment plan with them. They then take all of your debts
and combine them into one monthly payment. Be very careful when doing this
and make sure that this is working out to benefit you and not put you into more
debt. Be sure to add up all of your payments yourself first and make sure that you
are saving money and not ending up with a heftier payment. Also really research
the company and make sure that they are not a bankruptcy company- you do not want
to file bankruptcy at this point. Also make sure they explain to you how this affects
your credit rating and do your own research on this. It is important to be an informed
consumer especially if you are now dealing with a third-party organization.
- When you do get yourself out of debt, breathe a sigh of relief and vow to try to
never allow it to happen again. I know that it is easier said than done, but allow
this to be an eye opening lesson and use credit cards as a last resort.