How to Get Out of Debt When You’ve Hit Rock Bottom

What happens when you hit rock bottom? Rock bottom is emotionally, physically, mentally and financially draining place. Maybe your boss cut back your hours, or you lost your job completely and were out of work for a while. Perhaps you had “more month than money” left and needed to find a way to cover necessary expenses like groceries and gas. Or maybe you had some household emergency combined with unexpected car repairs and all of the kids needing braces at the same time.

No matter what the reasons are, you recently tallied up all of your credit card debt and were shocked to see that you have maxed out just about all of your cards and owe tens of thousands of dollars.

How to Get Out of Debt Quickly

What stinks the most is that you didn’t even enjoy a fancy trip to Maldives or Paris, a beautiful diamond bracelet and a house full of new cozy furniture from all of this debt. For the most part, it was everyday expenses combined with some emergencies that have you paying the bare minimum on each card and waking up at 3 a.m. wondering how you will ever get out of this predicament.

Here’s the good news. With some hard work and determination, which you can handle, you can recover from your rock bottom debt situation and pay off your cards, once and for all. 

How to Get Yourself out of Debt: Take These 4 steps

1. Stop Digging the Hole

To gain control of your credit card debt, you must first stop using your credit cards as a proverbial shovel to dig yourself deeper into debt.

Starting now, stop using your credit cards. If this thought makes you break out in a cold sweat, cut them up or freeze them in ice, so they are not easily accessible. Then, go out and live a full 24 hours without charging anything and celebrate a day of not going into debt any further.

If you use your cards because your income does not cover your expenses, look into a side hustle until you have your debt under control and are not paying hundreds, if not thousands, of dollars a month to pay off your cards.

2. Write Down Your Various Debts and Create a Plan

Remember how surprised you were to find out just how much credit card debt you have?

Round up all of your bills and note on paper the total amount of debt you have, what credit limits you have, the interest rates, and the minimum monthly payments –– doing that will give you a clear understanding of how much you owe while also showing which cards have the highest interest rates.

3. Start with Some Small But Significant Victories

While you might want to tackle the credit card bill with the highest interest rate, when you are first starting to dig out of high credit card debt, you need some small victories. So start by tackling the smallest bill first and throwing all the money you can at that total amount due.

When you pay off this amount, you will get a much-needed sense of “I can do this!” attitude and will be inspired to continue whittling away at your debt.

4. Protect Your Recovering Credit Score

If you were ever late on any of your credit card bills, the chances are good that your FICO score took a bit of a hit. Fortunately, as your debt starts to go down, your credit score will begin to go up again. To guard this score, consider investing in an identity theft protection plan. Find one that will keep an electronic eye on your credit cards and your other accounts and alert you if anyone steals your identity. Some even provide monthly updates on your credit score, and before long, you will look forward to those emails to see how much you have accomplished.

Getting Out of Debt Takes Time, But it is So Worth It

Being deep in credit card debt can make you chronically stressed, anxious, depressed, and even like you have failed Finances 101. But you are not a failure in any way, shape or form—you got in over your head in credit card debt, and thanks to these tips, you now have a workable plan to get out of it.

Keep at it, throw any extra money you get at those bills and before you know it, you will pay off your final credit card bill and be debt free forever.

photo source | pexels + giphy

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