Tuesday, December 27, 2011

10 Signs It's Time to Ditch Your Debt

By Suzanne Cramer

Sometimes it is hard to tell what your breaking point really is when it comes to debt. After all you are paying all the bills each month, the problem is that you just don’t seem to be getting anywhere fast. You realize after taking a hard look at your financial situation that you have little to no savings for retirement or otherwise, and after a second look your interest rates on your credit cards are rising.

The debt may have accumulated slowly, over a period of time or in some cases rather quickly as a result of a life changing event. Knowing when you are in over your head and admitting you have a problem is the first step to financial freedom.

Here are ten signs it’s time to ditch your debt!

1. Your family or friends start to notice.
Maybe it’s a subtle hint or a blatant cry for help, but they know and they are worried. For example you start pulling away from invitations to dinner out or activities that you say you can’t afford. Or, maybe it’s a flat out hey, “I need to borrow some money to get by until next month.” Your family and friends are able to see the warning signs that maybe you can’t see, or will ignore; heed their warnings.

2. People are telling you that you have a problem with your debt.
They aren't being mean, they are being honest, and unlike your judgment, theirs is not clouded by the emotions surrounding financial problems.

3. Signs of physical or mental abuse. 
Debt can be like a bad relationship and take its toll on your entire self; physically, emotionally, and financially.  It’s important to know when your debt is starting to affect you. Perhaps it’s a diagnosis of depression, insomnia or anxiety brought on by your financial problems.

4. You've got a reputation. And it may not be a good one. 
A reputation is earned, remember that.  Are you the one with the creditors calling you at work, the bounced checks at the bank, or the denial letters after applying for a loan?  Your credit reputation has been tarnished by your debt and it will follow you until you do something to fix it.

5. You are trapped in a love/hate relationship with your credit cards.
You love to use them, but you hate to pay on them. This toxic, vicious cycle is often the downfall for many causing their debt to spiral out of control. A card becomes maxed out so you open another, you can’t pay the monthly minimum on one of your cards so you charge it to another. 

6. You lack effort.
Let’s face it relationships take work and your relationship with your debt is no different. You have to “put in the time” and nurture the relationship. Establish and stick to a budget, remember to pay your bills on time, and call when you are going to be late. 

7. You feel isolated.
You no longer hang out with friends and family for fear it will involve spending money. You keep those close to you at arms length, so they don’t catch on to your money problems. 

8. You feel controlled by your debt.
You avoid answering the phone because you fear it may be a creditor on the other end. Your debt is controlling your life, how you behave, and where you can go. You feel your lifestyle has to change as a result of being controlled by your debt.

9. Shopping is your hobby.
If you are unable to enjoy life without having new things or spending money, this is a recipe for debt that will eventually catch up with you.   

10. You blame everyone else for your debt problems.
It’s time to take responsibility. While it isn't your fault you got fired; broke your leg and couldn’t work, or went through a divorce; its time to own the situation and your life.

Just as recovering from a breakup or an addiction is a process, so is ditching your debt. It took time for you to create the debt; it’s going to take time to get out. Knowing what steps to take and what your options are is a great place to get started.

What were your signs it was time to ditch your debt? How did you feel when you realized you had a problem?

Suzanne Cramer is a certified credit counselor and a Social Media Specialist for CareOne Debt Relief ServicesSuzanne writes for Divorce, Debt and Finances and Major Life ChallengesFollow Suzanneon Twitter @ADivorcedMom where she shares her insights as a single-divorced mom with tips and tricks to keep your finances in check.  


  1. Some of these points were me at one time and it's a great reminder. So glad I've reigned things in and am now in control. It feels good to spend with cash and ONLY when I can afford it instead of reaching for the plastic. Out of control debt is for the birds -- and I don't have a beak, wings or feathers. Ya knoooow? ;)

  2. Love the comparison of debt to an unhealthy relationship! For real!!! And yes, i've definitely got a love/hate thing going on with my CCs. smh

  3. I love your advice on debt...such an important thing to get raid off...so not needed!

  4. @Yum Yucky I am thrilled to hear you have it under control--credit card debt can definitely be debilitating!

    @Yakini Many of us have a love/hate with the plastic--just try to keep it all in perspective.


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