How To Cope When You're In Debt

Step away from the guilt, shame and fear.

Oftentimes, there's an element of fear and shame when it comes to facing debt. You might feel overwhelmed just by the mere thought of owing anybody money. It might even contribute to depression and anxiety. This is why an important first step is to deal with the feelings of shame, talk with a professional (find free resources here) and find ways to overcome those feelings in order to focus more on a plan of action.

Also, remember that you're not defined by debt and that you're a beautiful human being who simply happens to have debt. It's not the end of the world and it doesn't diminish the amazing person you are. Your life and mental wellness are priceless and should be celebrated and protected.

Honestly evaluate your income and budget.

If you don't have a budget, now's a good time to create one, even while in debt. When you have a budget, you get to know exactly how much money you're earning, how much you're spending, and what your bills truly are. This is the perfect opportunity to get honest about your money flow (even if you're unemployed or underemployed) and a great time to find out what your options are in terms of a plan to pay down debt. And make technology your friend. There are several budgeting tools and apps that will do all the hard work for you when it comes to tracking your expenses and money flow.

Be sure to take a realistic approach to budgeting, including recognizing what you're willing to give up, cut back on, or not. Getting help with this is also a good idea if budgeting is something that overwhelms you or is something you struggle with, and there are nonprofits and orgs such as Greenpath to look to for options in debt management.

Contact your creditors and explore your options.

Bills like those with medical institutions or hospitals can oftentimes be negotiated, down to the final sum due. You can also discuss your options with credit card companies and explore your payment options based on "hardship" programs. It can be a huge relief when you know you have options and everything isn't all doom and gloom. Oftentimes, you can get a handle on debt simply by talking with the party you owe, asking lots of questions about what your options are, and even making an offer that's more beneficial for you (i.e. settling the debt for a lower lump sum, forgiving late fees, or forgiving the loan altogether.) You can find empowerment by negotiating, even for conditions or amendments, that you didn't believe to be possible simply because you were so focused on worrying about the debt.

Celebrate the wins, big or small.

Whether you paid off a $200 debt or are much closer to finally paying off that $20,000 student loan, celebrate it. Don't let it just pass by as if it's a blip on the personal finance radar. It's good to treat yourself and focus on the good in the journey. Experts recommend doing this so that you can have something positive to focus on while you're going through a debt-management journey that challenges you. You can find small and affordable ways to do this. Include your support system and enjoy the company of family, friends, or bae.

Explore other options for income generation or downsizing.

While you may not want to add on the stress of a second job or side hustle, it might be a good idea to look for other options to bring more money in. Explore the return on time investment and really tap into why getting a second gig, applying for a higher-paying job, or asking your company for a raise might be the best option, especially if you're trying to avoid continued interest expenses and just knock the debt out as soon as you can. You'll have to become super-deliberate about how you're spending your time and ways you can bring in more income in order to pay down the debt.

If you can move in with a family member, take on a roommate or tenant, or try a weekend gig in which the salary or income goes totally toward cutting down debt, it might be a worthwhile sacrifice in the long run.

Whatever reducing debt can mean for you, peace of mind is priceless. Finding strategies or realistic ways to reduce debt is both reasonable and doable. With a bit of planning and determination, you can do it, sis. Remain encouraged and try the tips above to take your life back.

Let’s make things inbox official! Sign up for the xoNecole newsletter for daily love, wellness, career, and exclusive content delivered straight to your inbox.