5 Ways You Can Tackle Your Debt

Living with debt is a reality that too many Americans face. It can be hard to go on and live your life when debt collectors are constantly calling you and you never have any money left in your bank account after payday.

According to recent studies, 79 million Americans are living with some degree of debt. It affects every aspect of your life and can be mentally draining. Stress, depression, and anxiety can begin to consume you if you’re living with a debt that you’re unsure how to pay off.

There are ways you can tackle your debt and get your life back. Not every option is going to be the right one for you, but here are 5 ways you can deal with your debt and get your life back.

Ask A Professional

Debt is a serious problem that can lead to serious consequences. Living with a high amount of unpaid debt can lower your credit score and make it hard to get a loan or even rent an apartment!

If you’re dealing with a lot of debt and don’t know how to go about tackling it then your best bet is to talk to a professional. Set a meeting with a debt or financial counselor. They’ll go over all of your debt with you and provide you with options for tackling it based on your unique situation.

A professional can refer you to other resources that could help lower some of your debt. They can also help you figure out where you can cut costs in your day-to-day life to start repaying your debts. They are seasoned professionals who will help you determine a plan to improve your financial future.

Avoid It

Obviously, this won’t be much help to you if you already have debt, but the best way to deal with debt is to avoid it. Don’t take out loans that you can’t repay. Don’t buy that $1,000 cell phone just because you’re positive you can afford the $50 monthly payments.

One medical or personal emergency, unemployment, or a number of other unexpected factors could leave you unable to afford that monthly payment. Never buy something unless you could afford the pay the full amount, right then and there, in cash and still be financially comfortable.

Avoid falling into a debt trap by paying all of your bills in full and on time when possible. Never use your credit card to withdraw cash at an atm. When you do find yourself in debt you need to be proactive. Don’t wait too long to take care of the problem because it will only become exponentially worse.

File Bankruptcy

Sometimes we get ourselves into a situation that we can’t get out of. When that happens, it’s time to take a step back and try something different. You could spend the rest of your life chipping away at insurmountable debt, only for it to be shifted to your spouse or family members after you pass.

There are different types of bankruptcy you can file for so you’d need to speak with a professional to determine which is right for your situation. Bankruptcy should be a last resort, but it can be so worth it.

Filing for bankruptcy, “will give you a fresh start and allow you to take back control of your life,” says Karl S. Pearson, founder of Pearson Law, PLC, and one of the bankruptcy lawyers in Scottsdale AZ. Some forms of bankruptcy even allow you to retain your assets, including your car and home.

Payment Plans

Staring down thousands of dollars of debt is an overwhelming and depressing feeling. It can be hard to imagine ever coming out from under this burden, but it is possible. Most companies understand the financial burden that debt can place on a person and are willing to work with you if you communicate with them.

Call whoever is in charge of your debt and discuss your options with them. Most companies are more than willing to schedule set payments with you on a specific payment plan. Remember, these companies simply want to see progress against the debt. They don’t expect you to pay it all off at once.

Make your minimum payments on time every month to ensure that a late fee isn’t added to your debt. If you ever can’t make your scheduled payment then you need to call the company immediately and inform them. Oftentimes, they’ll be more understanding than you think and give you an extension.

Take A Class

Many people find themselves victim to debt because of bad financial choices and lack of knowledge about how their finances or credit works. The best way to start working toward becoming debt free is to grow your knowledge about how finances and credit work, and how they should work for you.

You can take classes online or even at a local community college if one is offered in your area. It’ll give you the chance to learn the ins and outs of what debt is, how it happens, and ways you can avoid it in the future.