Unfortunately for some people, the weight of their ever-expanding debt that has snowballed throughout their lives comes between having a restful retirement and working for as long as possible to pay off all of their accumulated debt.
According to new data from Experian, the average credit card balance in the U.S. is $5,221, and personal loans are up to $17,064. This is just on average, and when you are approaching the ripe age of 50 it is understandable to start to question how to tackle such large debts.
When we were in our 20s we all imagined enjoying our retirement on a tropical beach sipping cocktails, but with a huge lump of debt, it can seem impossible to imagine.
It is possible however, but taking the correct steps now to alleviate your debts is essential if you wish to reach a certain level of financial security. Being debt free, even if you are already in your 50s is a goal worth working towards.
If you are sailing through your life attempting to ignore your responsibilities to pay off debt, you should consider the negatives effects debt will place on your life:
Reduced Disposable Income - The interest that accumulates with paying off debt over time can consume a large portion of your income after paying other bills, leaving less money for experiences and enjoying your life.
Medical Problems - As we get older, we are more susceptible to illnesses and serious health concerns. The effects of stress on our health can be detrimental, and dealing with debt when we are vulnerable can be dangerous.
Negatives Of Debt In Your 50s
If you are sailing through your life attempting to ignore your responsibilities to pay off debt, you should consider the negatives effects debt will place on your life:
Reduced Disposable Income - The interest that accumulates with paying off debt over time can consume a large portion of your income after paying other bills, leaving less money for experiences and enjoying your life.
Medical Problems - As we get older, we are more susceptible to illnesses and serious health concerns. The effects of stress on our health can be detrimental, and dealing with debt when we are vulnerable can be dangerous.
Potential Lost State Pension - If the volume of your debts without effective management leads to bankruptcy, you are liable for your pension to be at risk.
What Steps To Take
You Must Change Your Mindset
How you perceive debt is one of the most important things if you hope to see change. If you are approaching your 50s or even are at a later age, debt should be seen as something to be resolved in comparison to something to live with.
Certain debts perhaps might be considered manageable and unavoidable such as a mortgage and medical expenses. If you currently are not considering your debt as a burden to be solved, you need to change your views.
If you hope to create a fast-track route to living debt free in your 50s, your mindset should align with these values. Commit to the change!
Before jumping into action, you should take some time to consider what living debt free would mean for you, no matter what age you are.
Consider What A Debt-Free Life Means
Before jumping into action, you should take some time to consider what living debt free would mean for you, no matter what age you are.
We all have goals, places we hope to visit, and people we wish to help when we can settle down and ease into retirement. Perhaps you would simply love to have the extra money to save up and pass the money down to your family.
Regardless of your reasoning, being done with debt is beneficial for everyone, but you should reinforce these values at all times to avoid creating further debt.
Begin to assess what debt you have. Gathering all of the data is essential if you wish to take control of your debts and stop them from expanding.
Gather All Your Debt Information
Begin to assess what debt you have. Gathering all of the data is essential if you wish to take control of your debts and stop them from expanding.
This can be difficult and of course, it might be difficult to come to terms with what debts you have, but have faith and know that it is possible to be debt free. Ignoring your debts will accumulate to even more debt over time, so nip it in the bud now and gather the information.
Do not leave a stone unturned, and request a credit report to see exactly what is owed. You might find there is credit on there you have been neglecting.
To begin the process of working your way through debt, you should seek financial advice. No one is expected to know the best way to manage debt as everyone has unique collections of debt.
Seek Financial Advice
To begin the process of working your way through debt, you should seek financial advice. No one is expected to know the best way to manage debt as everyone has unique collections of debt.
Financial advisors exist to find the best route to alleviating stress as much as possible and guide you through the process of paying things off. Potentially, they will personally speak with your existing creditors to reduce the interest rates.
Many routes can guide you through, but it is your responsibility to seek the help you need. There is no harm in asking for help.
If you have multiple debts that are weighing down on your current expenses, it might be worth seeking debt consolidation. Less debt means more savings towards your retirement, therefore if you manage to qualify for such consolidation from your debts you will potentially be en route to a faster debt reduction.
Consider Consolidation
If you have multiple debts that are weighing down on your current expenses, it might be worth seeking debt consolidation. Less debt means more savings towards your retirement, therefore if you manage to qualify for such consolidation from your debts you will potentially be en route to a faster debt reduction.
All of your debts will merge into one monthly payment, making the repayments easier to manage. Additionally, if you are looking to potentially write off some of the debts, seeking IVA advice would be beneficial to see if you qualify under your circumstances.
Ultimately, debt finds its way into most of our lives, but how we manage it is key to escaping its ruling over our lives. Stressing over the debt you already have will not benefit you, but taking the steps to acknowledge that you can ease debt with the correct action is vital.
Don’t Panic
Ultimately, debt finds its way into most of our lives, but how we manage it is key to escaping its ruling over our lives. Stressing over the debt you already have will not benefit you, but taking the steps to acknowledge that you can ease debt with the correct action is vital.
Take your time to calmly work through the process of scaling down your debts. Retirement will be much more enjoyable once you are in the position to enjoy all of your savings and responsibly manage your state pension.
If you hope to be debt free by the time you reach your retirement, you should implement all of the recommended steps. Understanding that you are not alone and that we all will have to come to terms with our debts might offer you some comfort.
Final Thoughts
If you hope to be debt free by the time you reach your retirement, you should implement all of the recommended steps. Understanding that you are not alone and that we all will have to come to terms with our debts might offer you some comfort.
Those of us who retire with our debts paid off can live more financially free than others, and you can experience this too.
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