Resolve to Get Out of Debt

Oftentimes, when New Year’s Eve rolls around, one of the resolutions we may make is to resolve to get out of debt. But, every year the debt keeps growing until we finally realize we are in trouble.
Current statistics show that “8.3 percent of households owe $9,000 or more on their cards. On average, today's consumer has a total of 13 credit obligations on record at a credit bureau. These include credit cards (such as department store charge cards, gas cards or bank cards) and installment loans (auto loans, mortgage loans, and student loans). Of these 13 credit obligations, nine are likely to be credit cards and four are likely to be installment loans.” Moreover, there were over “two million bankruptcy filings in 2005; an increase of 31% from 2004.”
While the statistics are staggering, undoubtedly the new figures for 2008 will be much higher. This is due to home foreclosures, the economic downturn, and overall increased debt among consumers. Thus, we have become a nation in debt.
The only way to get out of debt is to pay off the credit cards, avoid using credit cards except for emergencies, and pay with cash. According to the Federal Reserve, “a majority of U.S. households have no credit card debt. About a quarter have no credit cards, and an additional 30 percent of households pay off their balances every month.”
Resolving to get out of debt may be the single most difficult challenge we face today. The stress of living from paycheck to paycheck may be the proverbial wall that prevents most consumers from punching a hole in it in order to see a glint of daylight. But, steps can be taken to begin the process of digging out of this tunnel. Start with a budget that you can stick to; keep just one credit card on hand for emergencies, and start paying more than the minimum amount required.
For example, if you have multiple credit cards or other debts, begin by paying off one credit card, then take the money you would have used to pay that card and add it to the amount you would pay for the second debt owed. In this way, you will be adding more to the minimum amount required each month, and the debts will eventually be paid off one by one.
Paying for anything with cash these days seems like an antiquated notion. Every day, we are bombarded with new credit card applications that arrive in the mail. The problem is that we have fallen into society’s mindset that credit cards are a good, necessary, and convenient thing to have. But the truth is that debt is neither good nor necessary, but places us in a position of constant angst.
Here’s a little exercise: Take all the debt you currently have and add up the amount you pay in interest. Shocking, right? Think of what you could do with that money if you didn’t have debt. Credit card debt is the bane of society. Resolve to get out of debt; start planning now with a realistic budget. The sacrifices you make today will bring happiness and wellbeing tomorrow.