It Takes Extraordinary Effort to Get Out of Debt

So many people who are in debt are looking for a quick fix.  They think taking out a consolidation loan, or even worse using a home equity line of credit to pay off debt will free them. Unfortunately, all a quick fix does is put a band-aid on a place where you need major surgery.

In addressing credit card debt, an important starting point is to define how and why you are currently using your credit cards. If you are having problems making credit card payments, but you haven’t stopped using your credit cards, there really is no debt consolidation loan that will help you.

Yes, you may be able to lower your total monthly payments, but if you are still buying items and not paying the balance in full each month, you will just increase your debt more and more each month.

Using a home equity loan to payoff credit card debt is also a very bad idea. If you fail to make payments on the home equity loan, you could lose your house.  If you fail to make payments on credit card debt you might be forced into bankruptcy, but you won’t lose your home. So, using the equity in your home to pay credit card debt is very risky.

If you are looking for a way out of the debt cycle, there are several things to do immediately:

  1. STOP using your credit cards for any reason.
  2. Begin tracking every single penny you spend—even if it’s just $0.50 for a piece of gum. This will help you figure out what spending is absolutely necessary and what is not.
  3. Do not get another credit card “for emergencies!” Begin saving money in an emergency fund. It may sound crazy if you are already having trouble, but only pay the minimum amount on your credit cards until you have saved $1000 in an emergency fund.

Remember the definition of emergency —”a serious, unexpected, and often dangerous situation requiring immediate action.”  Do not use your emergency fund for anything that doesn’t meet the definition of an emergency!

  1. Start managing your money using a spending plan! You already know how much money you have to spend each month—the net amount you receive from all sources of income. Design your spending plan around that amount of money. If something isn’t in the spending plan, then you can’t buy it.

This may all sound like gloom and doom, but it’s not. It’s hard work, attention to detail and a commitment to get out of debt. I know. We did it!

You can accomplish almost anything if you are willing to sacrifice. Sacrifice—that’s a good “Catholic” word, isn’t it? If you want something badly enough, you should be willing to sacrifice for it. And therein lies the problem! It is hard, it’s not fun and it takes a long time—in other words, it takes sacrifice to get out of debt.

We had a couple come to us who had over $120,000 of credit card debt. They really wanted to get out of debt, so they applied extraordinary effort for about 4 years. They started their journey by applying the story of the Widow and the Oil (2 Kings 4) to their personal circumstances.

In this Bible story, Elisha asks the Widow “what do you have?”  This couple did the same thing—they looked at what they had, and found that they had cash value in a life insurance policy. They still needed to have life insurance, but the cost of their cash value policy was so high, they were underinsured.  So they took the cash value of their insurance and applied it to their debt. They also bought a term life insurance policy which gave them more coverage at a fraction of the cost. That one change paid off about $20,000 of debt real fast!

Next, they started tracking every single penny they were spending and found that they were spending money on things that were not necessary. They immediately adjusted their spending habits.

At the same time, they created a spending plan and stuck to it. Part of their spending plan was a debt snowball. Any extra money (no matter how little) was paid on their smallest credit card debt, while they made minimum payments on their other credit cards. Once the smallest credit card was paid off, they tackled the next smallest one and just kept repeating the process.

After about 4 years of extraordinary effort, they had paid off over $70,000 of the $122,000 in credit card debt!

They didn’t cross their fingers. They didn’t sit there and hope their debt would go away. They did not take out a consolidation loan or a home equity line of credit. They worked hard and made it happen.

Here is another good Catholic word: fasting. We usually only hear this word when we think of our Lenten practice of fasting on Fridays or fasting from a particular item during Lent.  Think about what we do during Lent when we fast. One big meal and two smaller meals that would equal one meal. We abstain from eating certain foods.

But what about a spending fast? Could you go a whole week without spending any money? There would be no stopping at the grocery, or the big box store, or even the gas station on a spending fast! Instead of running to the grocery store on a regular basis, could you make meals from what you have in the pantry?

Is it possible to turn your fasting week into a fasting month? Could you go a whole month without eating out or fast food meals, spending money on entertainment, buying any clothes? Can you limit car trips to a round trip to and from work only?

What would happen in one month if you expended this extraordinary effort? Can you set an aggressive goal for saving and paying off debt in a month’s time?

Set a savings goal. Set a debt payoff strategy and GO FOR IT! The extraordinary effort will pay off in so many ways.  You will see how little you really need to survive and you can revise your spending habits in ways you never dreamed were possible.


Send us an email to and let us know how your extraordinary effort paid off.

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