guide to reduce debt

5 Reasons You Can’t Get Out Of Debt

Nobody’s perfect when it comes to money. We all have bad habits, and we’ve all made bad decisions every once in a while. If you’re reading this article, you’ve probably ended up with debt, whether through decisions you’ve made or through issues out of your control. Nevertheless, here you are, facing the endless cycle of debt with no way to get out.

We’ve listed some of the most common reasons you can’t get out of debt below. If any of them sound familiar, we’ve also provided solutions to help you break the cycle of debt and get back in the black with just a little bit of effort and dedication.

1. You don’t have a plan

You want to get out of debt, but you don’t make a plan. What happens? You stay in debt with little chance of ever escaping, because without a plan, the money you’re putting towards debt repayment isn’t working as hard for you as it should be, and it will take you ages, if ever, to get rid of your debt.

When you make a plan to beat your debt, you go beyond wishful thinking. That small step to go from thinking about it and finally making a decision makes a world of difference.

Solution: Make a debt-repayment plan you know you can stick to, and do it ASAP. Then, commit to it. Here’s a quick three-step plan you can follow right now:

  • Know what you owe. Write down all your debt balances and their interest rates.
  • Arrange them in order. You can do this by prioritizing the highest-interest debt first, or the smallest debt first.
  • Pay the minimums — except for your priority debt. Pay the minimums on all your debts — but throw all the extra money you can at your priority debt. Once that priority debt is paid off, focus on the next priority debt, and then the next, until they’re all cleared. Congratulations!

For a more in-depth guide to achieving your financial goals, you can consult our step-by-step guide here.

2. You don’t track your spending

When you are not paying attention to your spending, it doesn’t take long before you have maxed out your credit. If you don’t track your spending, you don’t know where your money is going, which means it’s hard to find extra money in your budget you can use for debt repayments.

Solution: Know where your money goes.  You can start by making an effort to track  the big expenses each day.

Looking for easy ways to do this? Simply write down your expenses, maybe at the end of the day, or even throughout the day right as you’re spending, just make a note of it on your phone or through an app. If you want to take it to the next level, find a budgeting method that works for you.

3. You simply don’t have money to pay off your debt

Sometimes, you get in over your head and end up owing more money than you can realistically afford to pay back. It could be because of wasteful spending, or something as innocuous as an emergency you didn’t see coming that meant you had to take out an emergency loan.

Whatever the reason, if your debt is significantly larger than your income, it can be very hard to make a dent in your debt, and you might get discouraged from paying it off. And depending on your employment or financial situation, it might seem impossible to find any extra money for debt repayments.

Solution: You need to get rid of your debt, but it doesn’t have to happen all at once. Focus on chipping away at it as much as you can. You can start by spending less, making more — or, even better, both. Find some everyday ways to save money with this guide. And/or earn more money to pay off your debts with by asking for a raise or taking on some side hustles for extra cash.

4. You keep waiting for “the right time”

Do any of the following phrases sound familiar to you?:

  • When I get that bonus, I’ll pay off my debts.
  • I’ll make a budget after the summer.
  • After these sales, I’ll stop shopping for good.

Procrastinating is a terrible habit, and all the more worse when it costs you money. When you keep making excuses, you keep yourself in debt.

Solution: Don’t wait for a mythical “perfect” time: the best time to start is right now. Make a plan and tackle your debt head-on as soon as you can. Once you take the first step towards getting your debt under control, the rest will follow and you’ll be well on your way — but you have to take that first step, which can be the hardest.

5. You don’t believe you can do it


Maybe you’ve tried all the above, but you made a mistake and you gave up instantly. Don’t worry, it happens to the best of us.

When you face your debt full-on, you might be intimidated by the sheer size of it and simply give up, going back to spending recklessly and sinking yourself further and further into debt.

Solution: You can do it! If the above steps are sending you into a tailspin of panic, take some time to breathe. Feel free to vent to someone about your problem. And then, remind yourself that you are stronger than your debts and that you can do it. Once you’ve got that out of the way, take a deep breath and face your finances with renewed vigor. You’ll be in a much better headspace to make a plan that will succeed.

Getting out of debt is a challenge many of us have faced, or still face. But with a little determination and effort, you can haul yourself out of the quicksand of debt and prepare for a life that’s more financially free. Doesn’t that sound worth all the hard work?

This article was first published in April 2015 and has been updated for freshness, accuracy and comprehensiveness.

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