How to deal with overwhelming debt

If you are overwhelmed by debt and do not know where to turn, there are a few things that you might be able to do to make the situation less stressful. 

Most importantly, as tempting as it may be, do not ignore the bills nor avoid taking action to get help. The longer you leave a debt unpaid without working with creditors, the worse the situation can become. If you get a lot of bills and do not know how you are going to pay, it is time to get organized, making a list of everything owed, how much is needed each month for these bills and other expenses and work out a plan to get things under control. 

If you cannot pay in full or make the monthly payment on all of the bills, contact your creditors immediately to work something out. If you are within thirty days of the due date, creditors may be more willing to work with you on adjusting the monthly payment or the time needed to pay, then if you avoid things for several months.

There are a number of nonprofit consumer credit counselors who may be able to help. But, check out their reputation, fees, and terms and conditions. This is important because there have been some debt relief scams that people have fallen for. It is best to work with a local agency that offers the opportunity to meet with someone in person.

Pay at least the minimum monthly payment on all bills on time, and if possible pay more toward the balance, especially on debts with higher interest rates. Also, consider refinancing at a lower interest rate with a local bank or credit union, and use the amount you are saving in interest toward reducing the balance owed. And if you get windfall like a nice tax return or are able to sell some things that you do not need, use this extra cash to pay off some debt. 
 

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