Only A Plan To Reduce Debt Works

Dealing With Debt – Part 8

What do I do if paying off my loans and debts just aren’t possible?

There is nothing more frustrating than wanting to achieve a goal, but the goal is too far out of reach.  It’s so big that no matter how hard you try or desire it, it just can’t be obtained in the short-term. Like you, Pamela and I want to be out of debt so badly, but some of those debts are just too enormous to get them knocked out within the next 2-5 years.  What do you do with those? You may have guessed my response by now… you need a plan. No matter what the goal looks like you need a plan.

What Doesn’t Work?
I can name quite a few actions that don’t work to reduce debts.

1. Ignore them.  Ignoring your debt doesn’t do anything.
2. Save up and pay off.  Many have tried and most fail when you attempt to save up your money to pay off debts.  As life would have it, other needs arise that eats into your funds. It’s a good idea, but a normal one, tried by many and succeeded by few.
3. Use your leftover fund.   9 times out of 10 this strategy doesn’t work.  You want to pay extra by using your leftover funds.  If you’re like the majority, there are no leftover funds.  If you had such leftover funds, you would not be in this predicament anyway.

So what’s the solution?

A Plan Can Work
Everything begins and ends with a plan.  If you recall our rent-a-center method to paying bills, you can apply this methodology to small debts, bill-pay, and even large debts.  You have to find a way to make it simple and less of a pain for you and your family.  I have two suggestions that will work to help you reduce the debts you owe.

• Set up small payments.  Treat your reducing-debt-plan like an additional bill to pay.  Whether you have 10, 20, or $25 a month you can pay towards this new bill, doesn’t matter just as long as you make the payment.  Treat it as if it has a due date and add it to the list of bills you currently pay. Keep in mind that this is in addition to the payment you already make.  Warning: I don’t encourage adding it to the original payment unless you have tremendous discipline, keeping it separate adds just a little more awareness towards the overall goal.  
• Automate the extra you wish to apply.  Use a tool like the Simple Card that can help you save daily towards a monthly goal of X number of dollars to apply to your debts.

The key is to have and make goals you can accomplish which will give you confidence and momentum.

Today is Friday!
Do you have that one, two, or more debts that are so large that no matter what you throw at it, it just won’t go away?  If this is you, then this post and what it has to offer is worth trying. Doing nothing, changes nothing. It’s time to make a plan and use that plan to accomplish what seems impossible-reducing your debts.

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