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Tarry Law Firm, L.L.C.
Serving Southeastern Missouri For 15 Years

A checklist for dealing with overwhelming debt

Debt is stressful, especially when you are behind on payments. Worse yet, debt collectors may start sending relentless letters and calls. It can feel like giving up is the best answer. There are strategies to pay down overwhelming debt even when it appears impossible. Consider the following checklist for getting out of debt quicker.

1. Pay down debt one step at a time

Looking at debt in full can be disheartening. Do you have multiple accounts in red? Focus on one account at a time instead of trying to make minimum payments on everything. This is called the “snowball” method. Pick the smallest account first and start making above minimum payments on it until it is payed off. Then pick the next smallest account and do the same thing. Setting shorter term, realistic debt goals will help you achieve them.

2. Stop using credit cards

It can be tempting to use credit cards when you do not have enough money. Put your credit cards away and only use them in emergencies. Begin using cash and a debit card instead.

3. Sell unnecessary items

Do you have an old gaming system collecting dust in the basement? Do you have jewelry tucked away that you haven’t worn in years? Focus on selling unnecessary items and use the extra cash to pay down debt.

4. Change eating and drinking habits

Restaurants and bars end up taking a large portion of most people’s paychecks. Consider what you might spend monthly eating out with the family or having drinks with friends. Try to eat more meals at home. Make a grocery list and cook your meals. Invite your friends over instead of going out. Reducing restaurant visits to once a week can save large amounts of money. A simple change of habits can help you reduce debt quickly.

5. Try to do-it-yourself first

Paying for repairs or new items can quickly become expensive. Take time to fix things yourself before jumping into a costly repair. Consider watching a Youtube tutorial before spending money on an oil change. Try to sew rips before buying a new jacket. You can take the do-it-yourself mentality further and consider making your own gifts for upcoming holidays and birthdays.

6. Consider all of your financial options

An attorney can help you understand all of your options for eliminating debt. You may consider switching to a different payment program or filing for bankruptcy. Bankruptcy will essentially clean the slate. It eliminates certain types of debts and will halt all contact from creditors. It is important to understand all of your options for paying down unmanageable debt.

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