Debt is the devil.  Being in debt is one of the most stressful and anxiety-producing situations that you can find yourself in.  I have been there; it is overwhelming.  I used to lie awake at night worrying about it; I felt as if I had a constant weight on my chest.  Of all forms of debt, credit card debt is one of the worst.  I still remember getting my first credit card in college.  The sales representatives from the bank were set up in the student center taking applications.  That very first credit card came with a lovely 24.99% interest rate!  At the time I was too young and naive to fully understand what exactly that meant or what an impact it would have on me later on.  I want to state, for the record, that it is no one’s fault but my own that I ran up my credit card bill; I really do not like people who do not take accountability for their own actions.  With that said, it is not an accident that banks offer cards with this type of interest to the young and inexperienced…life has not yet taught them to say, “24.99%?!  Get the hell out of here!  No thanks.”  Long story short, like so many others, I spent more than I should have…a lot more.  I share this story only because it is an all too common tale and my advice may be helpful to others.

I was lucky.  My parents refused to bail me out.  Yes, you read that correctly.  I got into debt and my parents made me figure out how to solve my financial problems on my own.  You may be wondering why I consider myself to be lucky?  I know many people whose parents helped them out and paid off their debt for them.  Guess what?  Those individuals turned right back around and did the same thing all over again.  By forcing me to be accountable, my parents ensured that I had learned my lesson…and did I ever.  Through some very hard work and by following some good advice I was able to eventually free myself of debt.  Today I am very financially responsible.  I never want to go back to feeling the way that I did when I was in credit card induced hell.  Getting out of debt is not easy to do; it requires hard work and lots of sacrifice…but it is best to begin immediately and to stop accruing debt as soon as possible.  Here is some practical advice which I found to be very helpful:

1. Focus your payment efforts.  One of the most helpful pieces of advice that I got when paying off my debt was to focus my payment efforts on specific bills rather than attempting to pay everything off at once.  For example, I was advised to focus primarily on paying off my larger, higher-interest bills first; I did this while paying a much smaller amount on my smaller, lower-interest bills.  By focusing my payments in this way, I was able to make visible progress in my debt reduction efforts; at the same time I was able to seriously reduce my interest.  Had I opted to continue attempting to pay equal amounts to all of my bills then my progress would have seemed slower and I would have continued to accrue unneccessary interest.
2. Take advantage of balance transfers.  Many credit card offers will incentivize you by allowing you to make balance transfers for no or low-interest for a pre-set amount of time (for example, 0% interest for 12 months).  If you are able to take advantage of these types of offers, they can be incredibly helpful to your debt-reduction efforts.
3. Re-Finance.  I personally took advantage of this option which was hugely helpful to me in paying off my debt.  As is aforementioned, I got my first credit card in college and it came with a lovely 24.99% interest rate!  Being naive at the time, I did not realize just how hideous the ramifications of a high-interest credit card can be.  In an attempt to resolve my debt I contacted my bank to inquire about taking out a personal loan.  Luckily, the individual who I spoke with had a better idea.  He noticed that I had already fully paid off a car loan through the bank.  He pointed out the fact that the interest rates for car loans (at that time) were lower than the interest rates for personal loans.  By his recommendation I opted to re-finance my car.  I took the money from the re-finance and used it to pay off my high-interest credit card.  By taking this course of action, I was able to lower my interest from 24.99% down to 3.99%…which was a reduction of 21%!  Obviously this afforded me a HUGE benefit in my ability to pay off my debt in a timely manner.
4. Take out a personal loan.  This is another option which you may wish to look into.  Your bank will be able to advise you as to all of the associated interest rates which will enable you to make the wisest decision.  ***PLEASE NOTE: Your ability to re-finance or to take a personal loan will be determined by your credit.  If you have a poor credit history, due to failure to make timely payments or failure to meet minimum payment amounts, then these options may not be available to you.  Particularly in our current financial environment, banks are not in the habit of making loans to people who may not re-pay them.  Maintaining good credit is one of the most important things that you can do for yourself in life.  No matter what ALWAYS pay your bills on time and ALWAYS pay at least the minimum payment (actually, if you can, always pay a little more than the minimum payment…otherwise it may take you forever to pay off the principle).
5. Contact your financial institution.  In certain cases it can be beneficial to contact your financial institution to see if they would be willing to work with you regarding your interest rate.  Understand that they may not be willing to do this; however, it cannot hurt to ask.  Sometimes if you make it clear that you intend to pay off a credit card, and you agree to discontinue its use, then the financial institution will work with you.
6. Look at your budget…seriously.  When you need to get out of debt, you absolutely need to take a long, hard look at your budget.  You might be amazed to find out just how much money you are throwing away on little luxuries.  You need to sit down and really determine what constitutes a necessity vs. a nicety.  For example, eating…neccessity.  Eating out…nicety.  If you are serious about improving your financial situation, then you are going to need to make some sacrifices.  Maybe you grab a daily coffee at Starbucks?  At an average price point of $4.00, that daily habit is costing you almost $30.00/week…that is over $120.00/month (translation: about the cost of your typical smart phone bill).  Need your coffee?  Buy a travel mug and make it yourself.  Do not even get me started on cigarettes…in addition to killing you (and making your skin age like crap), the cost of smoking will bleed you dry!  Love Happy Hour?  Happy Hour loves your wallet!  Get creative…instead of going out, invite people over for drinks and snacks (ask everyone to either bring a bottle or a snack).  Budgeting sucks but if you are in serious debt, it is not an option.  You need to get smart about your spending.  My rule of thumb?  Unless it is an emergency (i.e.- medical, veterinary, vehicle-safety related, etc.)…if I can’t pay for it in one billing cycle (two, maximum) then I can’t buy it.  Period.
7. Consider taking on an extra job.  Again, not fun…but sometimes necessary.  Try to find a job which will enable you to maximize your cash earnings in the shortest period of time.  Think bartending or waitressing (not prostitution)!  😉
8. One last piece of advice…when you marry someone, their debt becomes your debt.  Be very careful with this.  Do not allow yourself to be financially abused.  If your partner has horrific credit then you may want to think long and hard about tying yourself to him or her legally.

As I stated earlier paying off debt is difficult and it may take a long time (it took me years), but it is not insurmountable.  You can do it.  Start today and you will be on your way to breathing easier and to living your most fabulous life!