by Lina Martinez

Debt is something we all worry about from time to time, especially if you’re a young adult just starting to make your way into the financial world. Considering over 44 million people in the United States have student debt on their shoulders, and considering the amount owed totals up to over a trillion, it’s no wonder debt is such a big weight on the modern consciousness! It simply seems a normal part of life at this point in time. 

But at the same time, we’re starting to get to grips with debt, bit by bit. Because it’s becoming so normalized, and because we’re always coming up with new and improved ways to cope with debt, there’s a lot you can do to help yourself out. All in all, debt is less scary than it’s ever been before, and now’s your chance to have a breather, if there’s an unpaid loan or two on your shoulders. 

And so, to try and help you relax about your chances of debt, or the amount you might owe right now, here’s just a few things to remember about the financial world and the debt it creates. We know of it now, and we’re willing to talk about it, so let’s go through some of the most important points. 

Credit cards are shiny enough when you first take them out, but they can soon lose their sheen. (Pexels Image - CC0 Licence)

We Know We’re Not Alone

Debt used to seem like something that only happened to other people. People who got into debt were irresponsible with their money, or they didn’t have the right kind of work ethic to make sure they had enough in their savings. But the truth is that anyone can fall into debt, and that’s something we’ve been more willing to acknowledge over the past few years. 

A credit card that you borrowed too much on, or one too many lines of credit without even realizing it. Going to university to get a degree, and living with the thousands in debt that you’ll only be able to start paying back when you reach a certain income threshold. Starting a business of your own, in which the planning went awry, and now you’re dealing with the fallout. These are all common ways to fall into debt, and even the most ambitious and money savvy among us could be guilty of a few fatal money mistakes here and there. 

So it’s important to remember that you’re not alone with your debt, and you’re never going to be. It can be an extremely scary time of your life to live through, and even the word alone can send a shudder through some of us, but you’re not going to have to struggle without a little aid and support here and there. 

There’s a Lot More Information Out There to Understand Debt

Do you understand how debt works? Because if you don’t, you’ve got plenty of information out there to look into to help you out. We live in a hyper-connected world these days, and any time you’re unsure about the jargon a credit or legal company send out to you in a letter, there are websites and people to reach out to clear up any of the confusion. Don’t ever let a confusing or scary letter sit unopened and poorly understood - this is one of the ways credit companies can sting you, and you should never set yourself up for a fail. 

After all, a fear of the unknown is one of the most common phobias out there, and debt can be very unknown to anyone who is new to the financial world, or in a financial situation they’ve never even heard of before. If you know what you’re doing, or you know what your bank accounts and credit score are telling you, you’re going to be in a much better position to tackle the debt you might be facing. 

Debt can come in many forms, and there are even some good debt options out there! If you’ve been proven to fall into debt, and be able to climb your way out of it with little effort on your part, you’re a dream customer to a lot of insurance, banking, and loan companies out there. It might even help to secure your chances of a new job. 

We Know We Can Consolidate Debts

Following on from the point above, debt is something we don’t have to take on alone, especially if you’ve got more than one line of credit to start paying off. Sometimes it’s in your best interest to consolidate them together, and pay them off all at once - it can seriously reduce the bills you get month by month, and gets the weight of multiple companies off of your back. It’s one of the best options for getting your credit score back into the healthy zone, and probably one of the fastest ways to do so too! 

If you haven’t heard of consolidating your debt before now, let’s quickly run through it for your benefit. It’s usually carried out in the form of another loan, but it’s low interest and streamlines payment all into one. A debt consolidation loan can be hard to obtain if you’ve already got bad credit, which is the main downside for quite a few people out there, but it’s still a viable option to look into. 

Of course, debt consolidation isn’t the right option for everyone, and anyone who is currently dealing with debt is going to have a unique situation that’ll take a unique handling of the case. But don’t worry! You can always contact services like McCarthy Law PLC to get a professional opinion on your current situation - having a lawyer on your side, if you don’t have a financial adviser already (or found little help from one in the past), is one of the best ways to gain your financial confidence back. 

And There’s More Than One Way to Prioritize 

When it comes to paying off debt, usually it needs to be prioritized at the top of your monthly expenses. Of course, keeping a roof over your head, and warming the house and putting water in the tank is just as important, but there’s more than one way to prioritize! Thankfully, you’re going to find more than one option of use to you, no matter what kind of situation you’re in. 

First of all, make sure you know how much you owe, and who you owe it to. The loans that are the oldest need to be the ones that are paid off sooner rather than later - the interest rate on these could be through the roof if you let them go unbidden for much longer. 

You also need to be aware of the minimum payment rates for any and all of the debts you might owe; if you can pay this little bit of money, month by month, you can keep the debt collectors off of your back. It might take a while longer to get rid of the debt altogether, but sometimes this is your only option in the here and now. You can always start paying more and more, if your finances change in the future. 

And then, of course, you need to know what kind of interest rates you’re coming up against. The higher the rate, the more you’re going to owe, and it’s a number that only increases as time goes on. If you’re working with a low-interest rate, usually of 10% or less (especially when it comes to credit cards!), the money you’re going to need to come up with won’t be too much trouble to manage. 

And these factors are all different kinds of ways you can prioritize your debt. Put the biggest numbers at the top, and work your way down. And don’t be afraid to chop and change as and when you need to! 

Not to Mention the Modern Ways to Reduce Debt!

A small final point, but an important one. There’s a lot of technology out there that can help you reduce your debt, even day by day, little by little. You can put caps on your spending each month (and even just capping your mobile phone bill is going to be a huge money saver for you), to make sure you never go over a certain amount. You can set up standing orders via internet banking apps, to make sure a portion of your income is always transferred over to a savings account, even with no input on your side! You’ll never forget to save the money you need to get the debt off of your shoulders, which is great for your peace of mind.

So, could you get to grips with debt? More and more people are, so why not follow in their footsteps? They’re leaving very obvious and easy tracks to follow, after all! Don’t let yourself worry too much about debt - it can really suck the soul out of you.