7 Tips To Avoid Making Your Debt Worse

By:    Updated: March 10,2017

When you're in debt, it may be hard to imagine ever being able to dig yourself out. "I'm already in up to my ears," you might reason. "What difference will another big purchase on the credit card make?" Unfortunately, this line of thinking has a tendency to worsen your situation and make it even harder to become debt-free. Here are a few tips for staying focused on eliminating your debt. If you follow these guidelines in the coming year, you will have taken a huge step toward paying off your debts and getting on strong financial footing for your future.

Acknowledge Your Debt

The desire to bury your head in the sand when it comes to your debt is strong. It's also easy in a society where access to credit (and even more debt) is just a click away. The only way to get yourself out of debt is seeing your current situation clearly so you can make a plan for paying down your balances. A good first step is to gather up all your statements for loans, credit cards and other debts to check them against your credit report.

Make Sure Your Report Is Accurate

Don't be one of the people who only finds out about mistakes on their credit report after applying for a big loan. Being proactive about checking your credit report through the three major credit reporting agencies can save you a lot of hassle down the road. It also might actually improve your financial situation since interest rates are often set based on the information in your credit report. Make sure your records match what is on the report. If there are any inaccuracies, you'll need to inform the individual credit reporting agency first, followed by a notification to the credit card company or other loan agency affiliated with the error. More information on these steps is available through the Federal Trade Commission.

Resist The Urge To Apply For More Credit

Just because you can, doesn't mean you should. In fact, if you're trying to get yourself out of debt, the very last thing you should do is apply for another credit card.

Make Your Payments On Time

Late payments are one of the leading factors in ruining your credit score, which quickly translates into higher interest rates and higher debt for you. Set up automatic bill pay through your bank or sign up for email and text message alerts so you will always know when your bill is due. If you're submitting a payment by check, make sure you leave plenty of time for the check to arrive prior to the deadline.

Avoid The Curse Of The Minimum Payment

You probably already realize that paying only the minimum payment on your card results in more debt down the line.

Don't Take It To The Max

Maxing out your credit cards or even approaching the credit limits is another activity that is sure to hurt your credit score and eventually your debt load. Set up a budget and work on living within your means. Remember that paying for things with cash can ensure that you're not spending more than you have in the bank.

Don't Co-Sign For Loans

The plea may be great. Your son really needs a new car in order to get to work, or your niece can't get a line of credit without someone co-signing for the loan. Resist the urge to help out by co-signing, particularly in cases where the other party to the loan has bad credit. What's at stake? If that person defaults on their loan, it comes back on you along with a smear on your credit report. Don't take a co-signing situation lightly. Explore other options first and, if you do agree to co-sign, act as if the debt is your own. Making sure that the loan statements are sent to you and that the bills are paid on time.


Once you commit to taking these steps, it's time to focus on paying off your debts. Start with your highest interest rate loans first. If you're like a lot of Americans, your New Year's resolutions might have involved paying off your debt.

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