“My humble question to you is….. How the hell do I get out of debt?… I am in my early 30’s and have finally launched a decent sales career, and will be watching my income grow. I have doubled my salary in the last 2 consecutive years….however, the debt steel wall is killing me! I have clipped the cards and doubled-to-tripled payments. This may be a stupid question, but I’m a desperate person right now, is there any (legal) way to kill this disease at a quicker rate?” — Anne-Marie

Well, it’s conceivable that one of the credit cards might agree to a lower rate if you threaten to pay it off and cancel it. (Bluff.) And there’s the option of taking a home equity loan at a lower, tax-deductible rate, to pay off your cards — risky if you then start running up debts again.

I wish there were some kind of “Get Out of Debt Free” card I could deal you.

But it does sound as if you’re now on the right track. You’re not racking up new debt; you’re paying off your outstanding balances faster. To get out of debt faster still, you’d need to go back to living more as you were two years ago, on half your present income, using the additional savings for debt repayment. (Of course, the reason you got into so much debt is doubtless that, a couple of years ago, you were living ABOVE your means, so reverting to that lifestyle might not save as much as it otherwise might have.) The worry is that, in sales, you could have a couple of bad years. All the more reason to live frugally, pay off the debt, and build reserves. Good for you for recognizing the importance of this and taking the steps to solve the problem. Keep it up. You’ll get there.

 

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