6 Ways to Relieve the Perceived Hopelessness of Insurmountable Debt

Do you feel as though you are drowning in debt, that you will never see the life preserver out there, let alone be able to reach it? If so, you are not alone. Not even close, actually. The world has seen a very different financial climate in recent years. Even the strongest economic areas have felt some of the pain it has brought with it.

Chances are if you are not facing a mound of debt, then you probably know someone who is. So, I am going to share some ideas with you on how to best survive these times, and build yourself back up to get back on track.
The most important thing to know here is that this does not have to be permanent.

1. Be Realistic

The first thing you need to do is take a realistic snapshot of your finances. This will help determine if you can do this on your own, need assistance, or should file bankruptcy. If you make enough money to pay your bills, but have struggled to do so due to lack of discipline, or temporary hardship, you might be better off doing this on your own.
However, there is help out there for those of you who are struggling a bit more than the average person, such as when the ‘temporary setback’ is turning out to be much longer than the bills can handle. Debt consolidation is one avenue you might consider.
This is where you typically pay a fee to a company that goes to bat for you in consolidating your debt, often cutting this debt down significantly. With the right company, you could get out of debt quicker, and pay less…even when factoring in their fees. Do a little research online to learn about your options, as well as get debt help, and advice.
The last option would be bankruptcy, which will affect your life for years to come. More people are going through this than ever, and will be just fine someday. So, if you have no other option, don’t beat yourself up over it.
Regardless of which route you go, the next few tips should be carefully considered as a lifestyle change, to help prevent this from happening again…and to get back on your feet quicker, which is what is most important.

2. Downsize as Best You Can

Take a look around to see what you can do to downsize. Of course, some of these choices might be difficult. If you have more cars than you need, sell one…or two. If the house is bigger than you can keep up with, sell and move to something more realistic.
Most households have more than one TV, game system, and more clothes than they could possibly wear in any given season. Have a garage sale, and then apply what you make to some of your debt. I’m not saying you have to get down to bare walls and a skeleton closet, but we all need to live within our means, even if that ‘means’ changes unexpectedly.
Bottom line is, if you have boat that you only used 3 times the entire boating season, sell it.

3. Lower Your Bills

Of course, we need to live…and not sit in the dark twiddling our thumbs. So, let’s take a look at what we can do to lower our bills, rather than shut them off completely.

  •     Mortgage – refinance, if you can, to get a lower rate. This will not only lower your monthly payment, but also lower the overall amount you pay in the long run.
  •     Utilities – Shop around for the best price for things such as cable, Internet, and phone. If you can’t, or don’t want to switch companies, call them to see what you can do to lower your bills. Most companies will work with you, rather than see you leave.
  •     Usage – Turn off what you are not using, including lights, water, and appliances. Turn the heat down or air up if you are not home. Even if you are, put a sweater on in the winter, or wear shorts in the summer.
  •     Insurance – Call your agent to see what you can do to lower rates. Again, they will want to work with you, rather than lose you. If not, look elsewhere.
  •     Food – Save money by getting creative with leftovers. For example, our local market has these wonderful cooked whole chickens for under $6, which can turn into at least 2 meals if you make a soup out of the leftovers.

Take a look at your bills, one at a time, and ask yourself how you can lower it. There are ways to lower most everything.

4. Set a Budget

Don’t just talk about spending less…set a budget to make sure you do. There is software available to put this all online, which will make it very easy for you. Keep track of every dime you make and spend, as well as receipts to make sure you are entering everything in…and I mean everything. If you buy a pack of gum, enter it.
You might be surprised at how some of your money was spent.

5. Pay off One Debt at a Time

The bills that can…and should be paid off, such as credit cards should be organized by how much you owe, and what the interest rate is. Paying one bill off at a time will help you pay down your debt quicker, than trying to pay it all off…because you will end up paying minimum payments and more interest in the end.
So, if you have 3 credit cards to pay off, try paying off the smaller one first. Then, take that payment (that you no longer will have) and apply to the next one you target. As long as you don’t keep charging, there is an end in sight.

6. Think Positive

Finally, think positive, as difficult as that might be for a while. If you are taking steps to relieve your debt, your day will come. If you let it get to you, it will make things worse. Depression can easily set in when struggling financially, and can lead to a lethargic state of mind and physical condition. When that happens, it makes it difficult to get out of anything, including bed.
Keep your chin up and keep looking forward. Learn from this, make some lifestyle changes, and you will be fine.

About the Author

Kathy Barber is a freelance writer, who writes on topics such as medical, online business, and home brewing. Her latest series was inspired when talking to others about on how to reach financial freedom. She did most of her research online and found www.debtmanagementplans.uk.com very helpful. Kathy lives in Michigan with her husband and son. When she is not working, she enjoys time with the family, cooking, entertaining, music, and photography.