Latest Posts on Credit & Debt
With SoFi, fellow alumni can help you refinance student loans at rates as low as 4.99 percent fixed or 2.92 percent variable (with AutoPay discount).Read More...
I paid off $80,000 in debt in 3.5 years by using what I call the Savings Triangle: Cut spending, increase earning, then automate and optimize.Read More...
Wondering if Dave Ramsey’s Financial Peace University is for you? Ramsey motivates millions to get out of debt, but his program’s not perfect.Read More...
If you’re looking to be approved for a credit card, you’ll need to have a credit score that meets the bank’s minimum criteria. This is why we hammer home this advice here on Money Under 30: Know your credit score. Keeping track of your credit score can alert you to problems in your credit report and […]Read More...
A 0 percent APR credit card can help you buy big stuff — a new appliance, furniture, or the trip of a lifetime — without paying a cent of interest. What’s the catch? Learn to decide how and when to use these offers and when to stay far, far away.Read More...
We all know that retirement accounts are for retirement; it’s foolish to withdraw from them for anything else and will often cost you thousands in IRS penalties. But one loophole allows you to borrow money from your IRA penalty-free (as long as you pay it back within 60 days).Read More...
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.Read More...
Some credit cards do not report credit limits to credit bureaus, which can have a negative impact on your credit score; here’s why — and what to do about it.Read More...
The statistics tell a grim story: In 2011, identity fraud increased by 13 percent, with more than 11.6 million adults becoming victims, Javelin reports. The sobering story behind those stats is that certain social and mobile behaviors promote higher rates of fraud.Read More...
You want your financial ducks in a row before you even begin looking at houses. And if you or a co-applicant has a credit issue, this becomes ever-more important. Here’s what to do with your finances in the months leading up to buying a home.Read More...
Dealing With Your 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.
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 determinitation 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.
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.
- Repaying Stafford Loans
- Student Loan Consolidation
- Risky Business: When Student Loans Go to Collections
- 10 Things You Should Know About Debt Management Programs
- Does Debt Settlement Work?
- When You Need to File Bankruptcy
MOTIVATION & MORE
Get help and stay motivated on your journey out of debt with MoneySchool, our free 7-day email course. Discover how you’re doing financially for your age, what to do next, and how to stay on track.