On Monday, I wrote about U.S. cities with the most and least financially distressed people in 2026. The top cities are Chicago, Houston, Las Vegas, Dallas, and Los Angeles, with the least distressed living in Pittsburgh; Lincoln, Neb.; Boise Idaho; Winston-Salem, N.C., and Anchorage.
So, the big question is: How do you get out of debt?
Many people are struggling financially these days. Inflation, the ever increasing high living costs caused by tariffs and other factors, and rising debt levels, including record credit card balances, are causing financial stress. In addition, a many people don’t have an emergency fund, making it hard to cope with everyday expenses and financial setbacks.
A Pew Research Center survey released Tuesday shows:
- Most Americans, 72 percent, rate the economy as fair or poor, while 28 percent say conditions are excellent or good.
- On tariffs, 60 percent of Americans disapprove of tariff increases, while 37 percent approve.
- Healthcare is the public’s top economic concern this year. A 66 percent majority say the federal government has a responsibility to make sure all Americans have coverage.
Here are some tips on how to get out of debt by WalletHub, a personal finance website, and others:
- Take a look at your spending: One of the first and most important things you need to do to have more money to pay your debts each month is to be stricter about your spending. Cut out any luxury purchases that you can, try to find better deals on your essential purchases, and put as much extra as you can toward paying your debts. In most cases, anything extra that you pay will help pay down the principal balance, rather than just interest, which helps you get out of debt more quickly.
- Make a budget. It’s essential to examine your spending in detail then develop a budget. Among your top goals for budgeting is when you went to be debt-free. There are free budgeting tools that you can consider using such as Excel, Open Office, Goodbudget, or WalletHub.
- Consider hardship programs: If your financial difficulties are temporary, you can ask your creditors about their “hardship programs.” These programs allow you to temporarily defer or reduce your monthly payments until you get back on your feet.
- Try debt management: Debt management involves negotiating permanently better terms with your credit card issuer, such as lower monthly payments or a lower interest rate. Creditors want to get paid on time, so if you show a willingness to pay what you owe but express that you need a bit of relief to do so, you may be successful. You should avoid paying a debt management company, though, as you can set up a plan directly with your lender.
- Avoid easy ways out: You might be getting offers for various types of debt solutions, and it can be difficult to determine what’s legitimate and what’s not. A good rule of thumb is that if it seems too good to be true, it probably is. For example, debt settlement companies may promise to get you off the hook for pennies on the dollar, but they’ll also require you to default first and hurt your credit score further. They tend to charge expensive fees, too. You could propose a debt settlement offer to your lender directly, but most people in financial distress don’t have the money saved for a lump-sum payment.
- Consolidate your debt: A debt consolidation loan can put all your debts in one place with a lower interest rate. Another similar option is a balance transfer credit card. In both cases, though, you’ll typically need good or excellent credit to qualify for any decent options. You can qualify for a debt consolidation loan with lower credit scores – even bad credit, in some cases – but you won’t necessarily get an interest rate lower than the ones on your existing debts.
- Avoid predatory lenders: It may be tempting to get quick, almost-guaranteed cash from a payday lender or auto title lender. But if you do, you’ll be slapped with exorbitant interest rates and fees that will make paying back the money a nightmare.
- Sign up for credit counseling. Credit counseling can help you figure out how to get out of debt. You can go to the website of the National Federation of Credit Counseling and find a counselor in your area. You need to watch out for credit specialists who charge high fees. If you work with them, you’ll just plunge yourself into further debt.
Best wishes. With planning, you can reduce your debt and move on to achieving other financial goals.
