F%@k debt 😡! Conquer debt, starting now.

I have had so many people in my life negatively impacted by debt, some as high as 6-figures worth of consumer debt Inot including mortgage) alone. The average consumer debt in the United States is $93k! Debt causes major issues in physical health, in relationships and in overall mental well-being. What I have found through the course of time in talking to close friends and relatives facing this dilemma is that it starts with the person. Debt is an enemy, don’t get me wrong. But, when you root cause it, it is not a money issue, it is a deeper, personal issue that needs to be tackled before you can move to conquer it.

1. Reflect internally. Take some time to reflect on how things got to be this way. What really caused this issue? Are you trying to buy your way to happiness? Are you spending extravagantly on loved ones because of guilt? Are you not there enough? Were you raised a certain way and are struggling to keep up with the lifestyle you had with your parents? Do you need people to see you as “accomplished?” Are you living a lie? Do you have gambling or addiction issues? For some, student debt is the major issue that keeps them up at night. That is a national crisis. The point here is that it is important to own up to the situation and your part in it, and understand the behaviors that caused the debt so that you can move forward. Have you been avoiding even thinking about it? It will only get worse. By starting here and reflecting, you’re more likely to get to the core and will be more successful in not repeating the situation in the future.
2. Get an accountability partner. One of the best things you can do is let someone outside of your immediate family in on your debt situation and your goal. Not just anyone. Choose the person who you know is supportive of you and not a naysayer or gossip. This will be someone you can regularly update on progress, and their purpose is to keep pushing you and cheering you on as you conquer your avalanche.
3. Assess how much you really owe. Don’t just focus on monthly payment amounts. Pull a credit report. Pull your statements, and assess how much in balances you have out there. What are the interest rates you’re paying? Write it all down in one place. Total it up.
4. Make a plan to pay things off. Dave Ramsey (who I respect) believes that you should start with the bills with the smallest balances first, regardless of how much interest you’re being charged. As a personal finance-minded person, I do not agree with that approach. I would never tell someone to avoid a 25% interest loan because it has a smaller balance, to go and tackle a 4% loan. You should never willingly pay more money to creditors than you have to. Instead, look at the interest rates of each of your debts and start with the high-interest ones first while making minimum payments on others.
5. Visualize your goal. Make a debt payoff chart, like those thermometer charts used for charity goals. Check out Pinterest for charting ideas. The idea here is to keep things front and center so that you have a constant view of your progress and can celebrate the milestones.
6. Negotiate, negotiate, negotiate. If you are sitting on a mountain of debt with credit cards or medical bills, and it doesn’t seem like you’ll near the end, start calling the creditors and making lower payoff offers. You’ll be surprised how many companies are willing to negotiate if they know your situation and your commitment to paying things off.
7. Consider consolidation. This is not your “get-out-of-jail-free card.” Some people are constantly in the revolving door of consolidating or transferring balances. However, if it makes sense financially, consider consolidating loans in order to get a lower interest rate and/or make things easier with one creditor to serve. If you still have good credit, there are many 0% or low-interest balance transfer offers out there. Just make sure that you understand the total cost of consolidating and/or transferring balances to ensure it is worth it and not costing you more in the long run.
8. Attack your monthly expenses like they are your worst enemy. Take a good look at your ongoing monthly expenses and list them out from highest to lowest. What kind of car are you driving? Can you downgrade? If you still have cable, cut the cords. I recently talked to someone who was $50k+ in consumer debt and was still paying $150/month in cable bills! That alone is nearly $2k a year that could go toward debt payoff. Instead, hit up the library for free DVDs and other entertainment. Consider raising your deductibles on auto insurance (at least temporarily) to help. Move to a lower-cost mobile phone service, such as Boost, Total Wireless or Cricket to cut your mobile bills in half. We switched from Verizon to Total Wireless a few years back, and it is the same service, using the same towers at 50% of the cost (Use Code JIUJ-CA0D to get a free month of service). Are you eating out regularly? If so, stop. Do it only when you absolutely need to. Attack your expenses like they are your worst enemy!
9. Look for ways to generate extra income. If you already have a full-time job and are well-respected with a good work ethic, consider asking for a raise. Consider asking for more responsibility to get higher pay. It doesn’t hurt to ask. And if it does, maybe you’re with the wrong company. Acquire new skills that make you more valuable. A lot of things, such as software, can be learned simply by watching YouTube. For instance, I built this website by watching YouTube videos. If you are able to side hustle, do it. It will also serve the purpose of keeping you busy and less likely to spend.
10. Understand that this is all temporary as long as you’re committed. Get into the mission mindset. Do you hear the mission impossible music in your head? I thought so. Keep your eye on the prize. This is only temporary. Enjoy yourself along the way. This can feel like deprivation, but if you spent some time on step 1 in that reflection period, hopefully you begin to understand what truly brings you joy in life, and most of the time, it is not material things. It is experiences and relationships…neither of which need to cost a dime.

What I outlined above is not a holy grail, but hopefully provides some perspective as well as some things for you to consider if you are tackling debt. While some debt is acceptable, most debt is not a laughing matter. It is a product of a bigger issue, and it does not need to be the thing that defines you.

You got this!