I started out with LSS as a Financial Counselor and met with people from a variety of situations, debt balances, and income levels. While I don’t counsel anymore, I receive testimonials from the people we serve and get to hear what getting out of debt meant to them. Not to mention, I hear from counselors all the time about how excited and happy people are whether they just started a Debt Management Plan or just completed it, meaning they paid off their credit cards through a program with LSS. So here are my takeaways that may be helpful for you:
First, people are ashamed
I hear it over and over and over that the people we serve are embarrassed they got into debt. And over and over our counselors never judge and always reiterate that it’s not how you got yourself in the situation, it’s what you do about it now. We all make mistakes and sometimes bad things happen to us out of our control. I can’t reiterate this enough: there is no shame in having debt or not having perfect finances!
Once you pay off your debt (or are on the path), this is what you’ll realize:
It’s easy to accrue debt
There are a variety of ways that people accrue debt every day…from broken appliances to job loss to under-earning and overspending. Accruing thousands of dollars in debt can take a year, a month, or sometimes even just a day. Regardless how it happened or how long it took, it’s easy to get into debt if you have the available credit. And then of course it’s much harder to pay off. Read on…
It takes effort
Paying off credit cards is not always easy. I’m not saying this to freak you out; this is just real talk. It can be tough and you’ll probably need to make sacrifices. With that said, the people we serve ALWAYS say what they had to do to pay off their credit cards was totally worth it. They are done with the vicious cycle of debt and paying interest and making no progress paying down debt.
There are folks that have taken second jobs, brought lunch every single day to work, cut cable, or shopped at thrift stores. And sometimes even a combination of all of that. The point is that it takes effort, but with will power, hard work, and creativity, you can do it. Bonus: the beauty of paying off debt faster on a DMP is that your sacrifices are only temporary!
Building up savings is so much easier afterward
Let’s say your credit card payment each month is $400. You make that minimum payment every single month and your balance is barely going down because of interest charges. Then picture your savings account which for many Americans is less than $400 total. If your car broke down tomorrow, $400 likely wouldn’t be enough to cover that expense, but you really can’t afford to set aside anything else into savings either.
Now picture yourself down the road with credit cards paid off. You have an extra $400/month to set aside into savings for emergencies or to add to your retirement. In 12 months, that’s a whopping $4,800! So as you can see, it can build up quickly. The trick is to consider savings as a “bill” just like utilities.
Take back control of your finances and start conquering your debt today so you can focus on building savings and other financial goals.
For more information on debt repayment options including the Debt Management Plan, schedule your FREE financial counseling session today. GET STARTED ONLINE or call us at 888.577.2227 for an appointment.
Author Elaina Johannessen is a Program Director with LSS Financial Counseling.