Yes, You Can Get Out of Debt (I Did!)

Yes, You Can Get Out of Debt

How did I get here?

That’s what I thought when — at just 26 — I was sitting in over $80,000 of debt. Maybe you’re wondering the same thing.

However you got into debt, you can get out of debt. All it takes is the determination to do what it takes…and time.

Debt may be a four-letter word, but it doesn’t have to be a bad one. Debt helps companies finance growth and create jobs. Debt enables students from underprivileged neighborhoods to become doctors. Debt helps young families buy homes. Unfortunately, there’s a thin line between how much debt can lift up your financial situation and debt that can crush it.

Too much personal debt becomes a cancer within our finances; the interest payments grow and grow until there’s not enough money left over to pay the rent, buy the groceries, or anything else. When that happens, we may simply borrow more to forestall the inevitable total collapse of our finances. It may buy time, but it makes the situation that much time.

Confronting your debt

If you’ve realized that you need to get a handle on your debt, congrats on taking the first step, and thanks for checking out Money Under 30.

Depending on the kind and amount of debt you face and other aspects of your situation (like your income, your other expenses, and your credit rating), the best route to get out of debt may be slightly different.

For example:

If you’re dealing with a mix of student loans and consumer debt and simply want to get out of debt as soon as possible on your given income (even though it may take years), establishing your own debt repayment plan and sticking to these seven steps may be helpful.

If you simply have a credit card balance that’s gotten a out of hand but have the income to pay it off in a year or two and good credit, transferring the balance to a 0 percent card and paying it off diligently may be an easy option.

If, however, you’ve maxed out credit cards or have already tried juggling balances and are now behind on payments (or close), seeking help from a debt consolidation company may be an option. In extreme cases, bankruptcy may be an option, too.

Whatever route you choose, know that as you work to get out of debt, you’re not alone.

Today, over 65 percent of four-year college students graduate with student loans. Their average debt is over $24,000 and climbing. And then there are credit cards, which sooner or later dupe many of us (including me) into racking up debts at ungodly interest rates.

But you can beat debt. I know because I did. I paid off my $80,000 in just over three years. Inexperience and stupidity got me into debt, but determination and hard work got me out. I started this blog because:

  • I want to help you stay out of debt and/or pay off your debt.
  • I want to share my experiences learning about money (and redefining my relationship with money) with you.

More reading

Perhaps the best advice I can give you repaying debt is this: Consider — at least consider — finding ways to EARN MORE money. I hustled for raises at work, transfered companies, got a second job AND started a business…all in the name of beating debt faster. And it worked. Just saying.

Student Loans

Beyond Do-it-Yourself

Recent Posts on Debt

When Mortgage Rates Are Low, It’s Always A Good Idea To Refinance, Right? Not Necessarily.

Even when rates are low, refinancing your mortgage isn’t always the right choice. Here are some points to consider before you refinance.

Traveling Abroad? The Best Credit Cards for International Travel (And Some You Should Absolutely Leave At Home)

Planning on taking a credit card overseas? Make sure you pack the right plastic. Some cards tack on hefty fees for foreign charges and aren’t as widely accepted. We explain why having the right card matters and offer a few suggestions.

How I Paid Off My Student Loans In Three Years While Working Abroad

You don’t have to choose between world travel and paying off your student loan debt. How working abroad was the best thing that ever happened to my money.

Why Is My Credit Score Different Depending Where I Look?

When it comes to credit scores, there’s a lot going on behind the scenes. What you see on Credit Karma or your credit card statement probably isn’t the same thing a lender will look at when they pull your credit report. Here’s why — and what you can do about it.

For The Best Auto Loans Rates, 5 Reasons To Consider A Credit Union

Credit unions often offer the best auto loan rates. Why you might want to stop by a local credit union before buying your next car.

When Good Credit Isn’t Enough: Why You Could Be Denied A Credit Card Despite Your Excellent Score

Responsible people with excellent credit scores are often shocked after applying for a new credit card … and getting rejected. It’s more common than you think, so it pays to learn why a good credit score may not be enough.

How To Get An Apartment When You Don’t Have A Credit History

Getting an apartment when you don’t have a credit history can be tricky. But remember: No credit isn’t the same as bad credit. Here are some ideas for convincing your new landlord that you are worth the risk.

Is Debt Settlement Ever Worth It?

Why debt settlement isn’t worth it. Companies that promise to end your debt problem for pennies on the dollar can cause more problems than they solve.

Debt-to-Income Ratio: The Little Number Your Bank Cares About (And You Should Too)

When shopping for a mortgage, one of the things that lenders will look at is your debt-to-income ratio. If this ratio is too high, it may keep you from getting approved. Don’t take any chances — know your debt-to-income and take steps to keep it at a healthy level.

Auto Financing For Smart People: Tips For Saving On Your Car Loan

Save money on auto financing by knowing your credit score and leveraging competing loan offers at the dealership. Put money down, keep the term as short as you can afford, and — of course — don’t buy more car than you can afford.