Why Am I Not Getting Anywhere Paying Off Debt?

September 3, 2013
By Elaina Johannessen, Financial Couseling Supervisor with LSS Financial Counseling

In most cases, people need credit cards to improve/build credit. We use them to get a good deal – 0% interest for 12 months to get that new couch. Why not? We use credit cards for emergencies. Maybe you had to bring your dog to the emergency vet and you didn’t happen to have $1,500 lying around or maybe your car broke down and you couldn’t afford a new transmission. Sometimes you may even use cards for daily living expenses to get points that you can redeem for free stuff. Whatever your usage may be, credit cards have become a way of life.

If you are like many Americans, you’re not paying off your credit card balance in full each month and you may be wondering: Why am I getting nowhere paying off this balance? Well take a look below…here are a few reasons this may be happening to you and ways to break this vicious cycle.

Interest And Minimum Payments

Because you’re not paying off your balance in full each month, interest continues to accrue – adding on to your credit card balance each month. Depending on your balance, interest rate, and payment, you might be bringing down your balance by just a few dollars each month. So interest is accruing and you’re making only the minimum payments to make your creditors leave you alone. That means you’re good, right? Not necessarily. Just making the minimum payments on your cards will make it impossible to pay off the cards quickly.

You’re Still Using The Cards

This one is pretty obvious, but sometimes you get caught in a habit or it’s convenient to use your card because you’re short on cash one month. Or maybe you just really need or want to buy something. Unless you’re lucky enough get a large lump sum of money at some point, your credit card balances will be there perpetually until you STOP USING THEM. Cut them up. If you need to keep one just in case of an emergency – temporarily until you build up emergency savingsthat’s fine. But get rid of the rest of them.

Debt Management Program (Dmp)

This method is an excellent means to conquer your debt in a timely manner. Check out your credit card statement for how long it will take to pay off making only the minimum payment - compared to a little bit higher payment. Depending on your balance, it could take you 5, 10, 15 or more years to pay off making the minimum payment. On a Debt Management Program, oftentimes interest rates are reduced (saving you money now and usually thousands in the long run) and payments may even be reduced. The best part though is that your debt will be paid off in 5 YEARS OR LESS and if you have multiple cards, you only have to make one monthly payment. Click here to get started on a DMP.

Pay More Than The Minimum Payment

You can also choose to just pay extra on your card each month. If you have multiple cards you can use the power payment method, meaning you start with the card that has the lowest balance and pay extra toward that card - while making the minimum payments on the other cards – until that lowest balance card is paid in full. Then move on to the next card and follow the same process until all cards are paid off.

Budget And Emergency Savings Are Key

Create a realistic budget right away so you can determine how much you can afford to pay toward your debt. Be sure to include an amount for emergency savings. This is critical because your savings will be your safety net in case of an emergency INSTEAD OF credit cards. This is the best way to break the cycle of needing to use credit cards.

Once You’re Done, Be Smart

When you’ve paid off all your cards, use your credit cards to maintain your credit rating. Only use them when you can pay off the balance in full each month. Then, figure out the best way to use the money you no longer need to pay toward credit cards. You’ll want to make sure you have at least 3-6 months’ worth of expenses in savings in case of income loss, but then what? Do you need to plan for retirement or a new roof or do you have kids that will be going to college?  Be sure to reward yourself for paying off your debt, but keep your other financial goals in mind.

It may not be an easy task to pay off all of your debt, but it will feel so good when you’re done. You will gain peace of mind with financial stability. So don’t wait to take control of your finances…take action today.


Financial Counselors at LSS are available to help you create a budget and plan of action to conquer your debt. Just like visiting the doctor to maintain your health, we all need a financial check-up at some point. So call us today at 888.577.2227 to schedule yours.

More Articles from America Saves:

Take the Pledge

I pledge to save money, reduce debt, and build wealth over time. I will encourage my family and friends to do the same

Take the America Saves Pledge

Tip of the Day

  • Written by Tammy G. Bruzon | October 21, 2014

    Drum up #holiday cheer w/a #frugal #family project! Share the gift of giving. http://ow.ly/CVOla  

Saver Stories View all »

Another Dream Realized

Written by Tammy G. Bruzon | November 7, 2014

Mary Brown was already a disciplined individual when she came to Wisconsin Saves coordinator Wisconsin Women’s Business Initiative Corporation (WWBIC) in last summer. She had successfully completed her bachelor’s degree with the assistance of her husband and son, and was now ready to tackle her next big dream – homeownership.


Transforming “I Can’t Save” to “I Will Save”

Written by Guest Blogger | January 13, 2016

You will not believe what it took to completely change my life. About three years ago, the HR Administrator of the corporation where I worked (as a temp with no benefits) forwarded an email to me. Fifteen seconds. One small act of kindness. That's it - that's all it took!


Coping with a Lost Job

Written by Katie Bryan | October 28, 2013

Aimee Shaffer worked as a Public Service News Director for radio for years until one day her employer downsized the company, resulting in hundreds of lost jobs, including Aimee’s.


Receive Updates

Sign up for Texts

Written by Tammy G. Bruzon | July 15, 2014

Sign Up

Sign up for Emails

Written by Super User | September 16, 2013

Get Emails

Take the Pledge

Written by Super User | September 16, 2013

Start Saving