If you avoid thinking about your debt because its overwhelming, or wonder, Can I really escape my debt, then youve come to the right place. Here youll find a variety of debt solutions you can apply to your life and answers to your most important questions.



Situation: Credit card debt

Solution: Reduce expenses and consolidate debt





Part 1: Reduce expenses



For most people with credit card debt, overspending is the root cause of the problem, so you need to take a two-pronged approach. The first step is to reduce your spending. If youre not sure where you overspend, write down everything you spend for one month. Be specific, for example,



Shoes, $54.65, Macys, 2/3

Food, $16.50, grocery store, 2/4

Cleaning supplies, $25.50, grocery store, 2/4

Candy bar, $.75, vending machine, 2/5



At the end of the month, total each category and then see where you can cut. Obviously, you cant scrimp on the rent, but you could make an effort to reduce your electricity bill by turning off the lights when youre not in the room and unplugging unused electronics. You can trim your food bill by using coupons and not buying convenience snacks or sizes.



Part 2: Consolidate debt



Reducing your expenses will give you more money to pay down your debt, but youll only make true progress if you consolidate your debts to reduce your interest rates. Its hard to see progress when your debt is spread across five credit cards at 20%. If you own a home, consider a home equity loan to consolidate your debt at a much more affordable rate preferably below 9%. Not only will your debt payments cover more principal, but you may also be able to deduct the interest from your taxes. Use the savings to pay down more debt.



If you dont own a home, consider a credit card balance transfer to a 0% card. Look for one with no transfer fees and aim to pay off the debt before the offer expires. If you dont succeed, transfer it again. You could also opt for a personal loan if you dont qualify for a balance transfer.



Situation: High mortgage payments

Solution: Refinance or sell



The solution to high mortgage payments depends on your situation. If you can afford the payments and maintenance, but feel your interest rate is too high, you should refinance into a lower, fixed rate. If your mortgage is more than you can reasonably afford, then you may have to sell the house and move into a smaller one. Although its hard to sell a house you love, its better than going into foreclosure. Contact your lender to explore your options.



Situation: Medical debt both large and small

Solution: Negotiate for a payment plan or consider bankruptcy



If you have a medical debt that you just need more time to pay, contact the doctor or hospital to request a payment plan. In some cases, they may also be willing to negotiate a lower balance in exchange for regular payments. If youre not comfortable negotiating, a credit counselor or medical bill advocate may be able to help you. For large debts that youll simply never be able to pay, you may have to consider bankruptcy. Although its never the best choice, costs for some illnesses are more than anyone can reasonably pay.



For every debt situation, there is a solution. Your first step should always be to reduce expenses where you can. Then you can dedicate more money to paying down debt. Soon, you too can say, I eliminated my debt.



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