Started using common sense and took all priorities and put them in order and the end of the list was eliminated and paying off debt became a big priority. Started living below my means. Once debt was paid off stayed out of debt and made the priority to save.
This may not be the way for everyone, but it worked for me.
We were over $95K in credit card debt, and life was not good.
I purchased a tape program explaining how to get out from under the card debt, and I followed it to the letter.
I quit paying the cards.
Approx. 90-120 days later the calls started coming.
I told not to call after 8 PM, and I was always polite (they're just doing their jobs), but I made sure they didn't harass me.
After a while they started to make offers of reduced payoffs. I made counter offers (I was very lucky that I had someone that I could turn to that fronted me the money at no interest), and it was amazing what cc companies would accept or the collection agencies.
In the end, I paid off all debt for less than $40K.
Our credit score went down to 500-600, and credit reports were dinged for almost seven years.
We changed our lifestyle, our credit reports are super clean, and our scores are 820+.
Recommend that you do this yourself since companies would rather deal with you than an outside source that will charge the hell out you to do what you can do.
When my wife and I were first becoming established as adults we had racked a decent amount of student loan debt. As time when on neither of us had well paying jobs and we found ourselves relying on credit cards and credit lines from our credit union to make ends meet. Of course we often found that we couldn't make all these payments as scheduled and took many dings on our credit reports because of 30/60/90 day late pays. In 2010 my wife and I decided we were had progressed in our careers far enough we could afford a house payment.
We visited with a mortgage company and were denied because of bad credit, both of us being in the 500s, mostly because of high usage on credit cards and late pays. Armed with this information we made a concerted effort to pay all of our credit payments on time and to not use our credit cards. In a year we had successfully payed our balances down enough to get us into approval range.
Around the time we bought our first house we still had quite a lot of credit card, student loan, and auto loan debt and struggled to keep track of where our money was going. I stumbled across Mint, signed up, and added all my accounts. Armed with this holistic view of our finances we were able to make smarter decisions about what we buy and even started budgeting to a certain extent. I will admit that we still don't budget as well but I've been trying to utilize what's available in Mint for budgeting with some success.
Because of the better overall view of our finances we were finally able to start saving some money and over the next several years had a pretty decent nest egg in a saving account earning little to no interest. In 2016 I read a blog posting by Dave Ramsey about his "7 Baby Steps" to reducing debt. Again, I'll admit I don't follow them to the T, but we used the bulk of our saving to pay off our remaining student loans. This freed up several hundred dollars a month in income that had previously been loan payments. Using the "debt snowball" we made much larger payments against our existing credit debt. Because we continue to buy cars ever couple of years and it seems like something expensive is happening to a house, car, or medically, we are still debt snowballing, however even with this debt we are continuing to make headway against our debt and every year we have less and less. Additionally, because of this, we are in a much better place to make our payments and both of us now have 800+ credit scores.
In summary, watch what you are spending and reduce unneeded expenses. Track your incoming and outgoing income with something like Mint. Budgeting was hard for me because I like buying expensive electronics but I realized that we were overspending on thing we didn't need. When you can, using Dave Ramsey's baby steps are a great guideline for paying down existing debt. Finally, don't expect changes overnight, we've been working on it for 8 years at this point. I'm an impatient person so this was one of the hardest parts. Things started off really slow but the changes are incremental and good habits will eventually pay off.
I chose to go into debt with a vehicle loan to buy a vehicle I absolutely love. Otherwise it's careful planning and budgeting and hope I don't forget something in the process!
I do have some money squirreled away as a last resort and emergency. My 401K and Vested Benefits also are a priority. One step at a time. I'll get there!
I got my first credit card very young. I had no direction or guidance and with new responsibilities comes brand new consequences. Being older and needing good credit has been a struggle because I now have to answer to those mistakes I made as a young adult.
Hello everyone! I made a decision to be debt free at the end of 2018. I made it! After having been in the hospital 2 times in 2014 with a costs to us of $11,500. and remodeling a house we were really in debt at the cost of $27000. We also had to charge appliances, auto repair, etc. that we just didn't have cash for. A lot of people do not in this day and age. I decided this had to stop. I have always had some sort of budget. I would put whatever I had left from my check in the back of my checkbook. I could use this for a much needed mini va-ca.
I really just stopped charging!!!!! I would pay a small one off and take that money each month and put it towards another one. I sure did use a lot of money in the last 6 months of 2018. I started using my SS to help pay them off. It was hard, I could see other things I wanted to buy, but I didn't. It was like a heavy burden lifted from me. I have charged a couple of hundred since. Paying them off as they come in. Such a relief. Now, if I keep working and need to buy another car, I will be able to do that. Hang in there! If I can do it, so can you!!