How to Get Out Of Debt Fast When You Don’t Have Much Money

The post How to Get Out Of Debt Fast When You Don’t Have Much Money appeared first on Penny Pinchin' Mom.

How do you get out of debt when you are broke? After all, if you had the money,  you would not be in debt in the first place.  Right?

I hear this from people, just like you.  It is often not how much money you make, but the debt payoff plan you are using that is not working.  It is possible to get out of debt with no money; you just need to learn how.

get out of debt

There are plenty of inspiring stories of people sharing how they got out of debt, despite not making much money. In fact, you may feel you relate.  But yet, you don’t think you can do it. For whatever reason, you think you can’t get out of debt as they did.  It is impossible.

Or is it?

My husband and I were living on one income when we decided it was time to get out of debt.  It took us nearly 2 1/2 years but were able to pay off more than $37,000 in debt.  There are countless other stories of our readers who have paid off similar amounts in even less time.

I am here to tell you that you CAN (and should) get out of debt – no matter how little money you may make!!



I am going to share the steps anyone can follow to learn how to get out of debt – no matter your income level.  If you struggle to make ends meet, you already know how to make the most of a dollar, and I’ll give you additional tips so that you can pay down that debt.

I have asked this on Facebook all of the time, and some of the comments include:

“There is no way I can do this. Not with my medical bills.”

“Sure, that only works or some people – not me.”

Many of you may be thinking similar things, and I completely understand that way of thinking. I was there myself and know that it seems like an unattainable goal.  That is why you are reading this right now – to find out how to make this dream a reality.

Debt is NOT a Good Thing.

If you are in debt, it could be because of your own decisions or even those you can’t control (such as health, job loss, etc.).  No matter how it happened, you need to get rid of it. Period.

The reason you need to eliminate your debt is that it genuinely is holding you back. How can you move forward financially with this obstacle standing in your way?  If you found that you needed to buy a new car, you would find a way, correct?  For most, that would probably mean an additional monthly payment – but you would do it because you needed to.  You need to look at debt the same way:

“Getting out of debt is not a desire – it is a need.”


I remember in 2009 when my husband and I thought there was no way we could get ever get out from under our debt.  It was an impossible dream. At that time, I was not working at that time, and so we had one income and two young children to feed.  I initially thought that there was no way at all that we could do this.  It was just not possible.

We started by looking at our finances (oh – they were awful).  Our goal was to live a great life.  We could have kept on and kept just getting by, but that was not how we wanted to live. Just “getting by” was no longer an option.

Knowing our kids would be watching us, we knew the importance of being a good role model for them.  We wanted them to learn how to handle money by following our example.

We both agreed that not having debt was pivotal in having a positive financial future. We wanted this not only for ourselves but also for our children as well. It was also essential for our marriage.  We needed to remove anything that could potentially cause stress – money, and finances being a big one.  Our relationship was good, but we knew we could even make it better.

To begin our journey, we read Dave Ramsey’s Total Money Makeover. We followed much of his advice but figured out some things that worked for us as well. Being debt free is a fantastic feeling that no one can describe.  You have to live it.



The very first step to getting out of debt is to decide you want to do it.  That was the change both my husband, and I made.  Once we were ready and committed to getting out of debt, we began our journey.

You might be saying that you can’t do that though.  I’m here to say that you can – when you really, truly want to make it happen.

Getting out of debt doesn’t require you to be rich. Anyone can do it.  Even if you have a low income or don’t have much money. Like I said above, knowing that you want to make the changes and pay off your debt is only one small part.  The more significant issue is how in the world you actually can do this.


1. Face YOUR Reality

According to CNN Money, the average American family made around $59,000 in 2017. While that is the average, it is also true that many Americans make much less than this.

With a lower income, it is even more critical that you have no debt at all. After all, you are already stretching every dollar to cover your bills. You don’t need additional payments causing more financial stress.

Unless you win the lottery, a wealthy relative leaves you a small fortune, or you find a better job, you know your income won’t change.  That is the truth. You can’t change that.

However, what you can and must do is take the steps you can to work yourself out from under the mountain of debt you may be facing. You need to first create a budget, determine how much debt you have and then the steps to pay it off, no matter how much money you make.


2. Fully Commit

If you are not 100% ready to make changes, then you are destined for failure. It may be blunt, but it is true. If you can’t “go all in” and fully commit to making whatever difficult changes necessary (trust me, it will be challenging), then you need to stop reading right now.

If you are ready to make this lifestyle change, then read on. You’ve already made huge strides to make changes in your life.


3. Create (and use) a Budget and Debt Snowball Form

Knowing where your money goes is paramount to getting out of debt, no matter how much you make. Without your budget, you can’t even consider getting out of debt.

If you have never created a budget, it can be overwhelming.  But, it will also be eye-opening.  In addition to your budget, you should create a debt snowball, start using the envelope system and take better control of your money.  By doing this, you will get a better picture of your debts and how you can tackle them.

Look at paying off debt like a football team.  Each part of your finances is involved in the game:

Home Team – This is you and your family
Visiting Team – These are your debts and expenses
Your End Zone – This is where you will be debt free
PlayBook – Budget and debt snowball forms
Football – Your money
Refs and Penalties – Unexpected instances which set you back in reaching your goals

You would never expect a team to run onto the field and play the game without having the proper plays in mind. The same is true for you;  If every one of the members of your family has a different idea as to how to get your money down the field to pay off your debts, you will never make it there.

Instead, you design smart plays and work together to get there.  You work to get your money past all of the expenses you need to dodge.  There may be setbacks, and you may have to move back before you can get forward.  However, with hard work, you will get there.  You will get onto the scoreboard – and end up claiming victory!


4. Find extra money

Before you jump in to try to pay off your debts, you need to have savings.  The reason is that if an emergency comes up, you need to pay for it – in cash.  You do not want to run to your credit card to cover the expense.  It is best to have at least $1,000 in the bank before you get started.

So, before you jump in to pay off those debts, you listed above, make sure you’ve got money in the bank to cover your unforeseen expenses by creating an emergency fund.

Once you have that done, then you are going to have to find a way to squeeze everything you can out of every cent.  For some, it may mean no longer dining out.  For others, it could be shutting off cable television.  Where there is a will, there will always be a way to make this happen.  You just have to do what you can!

I share this true story in our budget post, but I’m putting it here again for you!  My husband and I gave up dining out. No joke. We ate dinner out very infrequently.

While I look back and think it might have been once every couple of weeks, I asked my husband recently, and he said that we were lucky to eat out once a month! It was painful, but now that we’ve cut down out all of our debts, we have income freed up so we can have dinner out more frequently (if we so desire).

For even more inspiration and ideas, you may have to find some radical ways you can get cash to help you get out of debt.  Do whatever it takes (legally and within reason, of course), to help you get out of debt.

Read More:  60 Creative Ways to Save or Make Money


5. Find ways to get more money (i.e. side hustle and selling items)

To be honest, if you are struggling to make ends meet on a low income, you won’t be able to just cut enough out of your budget to pay off your debt.  Like my mom use to say – “You can’t get blood out of a turnip” – which means if it isn’t there-there is nothing you can do about it.

That is the truth, and I’m not trying to lie to you. I am realistic and know that if you are making barely enough to cover your expenses, you won’t have any extra money for your debt.  I get that.

You can’t save enough money on your budget to eliminate your debt.  Well, I guess you could, but that is going to take a very, very, VERY long time.  So, what do you do when you’ve saved all you can and still can’t pay off your debts?  Well, you just have to get creative.

For some this may mean finding items you no longer need, which you can sell to raise money.  When we did this step, we had the same issue.  We could not cut anything more from our budget.

For us, this meant selling items we no longer needed. We did a large cleanout and got rid of furniture and other things we were holding onto, just in case we needed them. By doing this, we were able to come up with several thousand dollars — 100% of which went immediately towards our debt.

If that isn’t an option, you might want to consider getting a second job or side business to bring in income to indeed help you get out of debt.  We also did this. I started my website.  Now, let me be Frank in saying that this is not a great way to make money.  Most blogs make little to nothing in the first couple of years.  I was lucky, and we did pretty well, and I was able to bring a bit more each year – all of which helped us to pay off our debts.

It may not be a blog, but perhaps babysitting, or cleaning houses, raking leaves, shoveling snow — there are all sorts of ways that you can make money.

Read More:  Unique Ways to Make Money From Home

It is not the income that is holding most people back, it is the understanding and knowing even where to start.  You might have to scale back on various spending aspects of your life, but when you get to scream from the rooftops — WE’RE DEBT FREE!!!! — it will be worth it all.  I promise you!!!


get out of debt

The post How to Get Out Of Debt Fast When You Don’t Have Much Money appeared first on Penny Pinchin' Mom.


What It Feels Like to Be In Debt (And How to Get Out From Beneath It)

The post What It Feels Like to Be In Debt (And How to Get Out From Beneath It) appeared first on Penny Pinchin' Mom.

This is a sponsored post on behalf of Mr. Cooper. 
All opinions are my own and were not influenced by any parties.

Consumer debt has just hit an all-time high.  It now tops more than $3.8 trillion.  Not million. Not billion.  Trillion. Being in debt can make you feel as if you are completely alone.

But, you aren’t alone.  There are thousands of people feeling exactly like you do right now.  I say this because I used to be one of them.


When I was in my 20’s, I racked up a lot of debt.  I was drowning, and I thought there was no way out for me but to declare bankruptcy.  At that time, it was all I could see in front of me.  It was all I knew, and I thought it was the life preserver I needed.  Turns out, that it saved me from drowning, but it did not teach me to swim.

But, that didn’t fix anything.  The reason was that I did not take the time to get to the root of my problem, which was how I looked at money.  So, wouldn’t you know it, several years later, my husband and I built up nearly $37,000 in debt.  And once again, I felt like I was drowning.  But this time, I did not use the life preserver.  This time, I stopped treading water and learned to swim.

My husband and I worked together and developed a plan and began the hard work of paying off our debt.  We sold things.  For a while, we did not eat meals out.  We cut back our spending.  For us, it worked.  We were able to pay off that mountain of debt.

I still remember sitting at the dining room table that February night in 2010.  We’d done it.  We’d actually done it!  $37,000 gone in a little more than two years!!  The minute I hit send to pay off the loan, I felt instant relief. It was as if a weight that had been pushing me down all of these years was instantly lifted away.  I was able to float and catch my breath.

For me, it wasn’t just the fact that I paid off the debt. I’d taken the easy road and done that before.  This time, it was because I did NOT do it in the same way. I learned a lot about myself and made changes so that I would not find myself taking this path ever again.


More than 32 million consumers have higher-interest debt, an average of $8,600 per U.S. household to be exact!  And, a recent survey conducted by Mr. Cooper found that 68% of Americans are concerned about their debt.

If you find yourself unable to sleep because of your finances, you aren’t alone. I recall many sleepless nights worrying about how I was going to pay the bills and feed our family.  In fact, did you know that 33% of people with debt also lose sleep?  See, you really aren’t alone!

During our journey, there were many times we both agreed that we’d have done just about anything to get out of debt.  And, some of our ideas were pretty extreme!  When YouGov asked those in debt what they would do to have their credit card debt forgiven, 31% said they’d give up social media for a year!!  But, then again, there are times I’d be willing to give up social media just not to have to deal with social media. 😉

That makes me wonder, what would you do if you could no longer have to worry about your credit card debt?  Maybe you would do one of these:

  • Would you give up your favorite sweet or savory treat for a year?  32% of people surveyed said they would.
  • How about getting a tattoo of their favorite preteen musician?  14% would do this if they could be debt free.
  • Maybe relocate to Antarctica for two years?  If you’d do this, you are among the 8% who’d do this.


There are options, and one of the simplest ones may be staring you right in the face.  While consumer debt has continued to rise to more than $3.8 trillion, so has home equity.  Home equity values continue to climb and are up by 100% since 2000! In fact, the average homeowner has an average of $90,000 in home equity.

Before you think I am talking about getting a home equity loan, let me stop you right there.  That’s not what I am referring to at all – there are other options.

This is where Mr. Cooper comes in. Mr. Cooper, the nation’s largest non-bank mortgage servicer and a leading mortgage lender, is reimagining the homeownership experience to make the home loan process more rewarding and less worrisome. . A loan expert can walk both existing and potential homeowners through their financing options, along with all the pros and cons of refinancing so customers can make the right decision for themselves, and the home loan process is more rewarding and less worrisome.

What people don’t realize is that you may be able to tap into your home’s equity and reduce those high-interest credit card payments.

Homeowners make monthly mortgage payments and slowly pay down the balance that is owed on their loans. At the same time and in many cases, the value of the home continues to increase.  The difference between what a homeowner owes and the appraised value of a home is home equity.

For example, if you owe $150,000 on your house and it appraises for $250,000, you would have $100,000 in equity.


The idea is pretty simple.  You are going to take out a new loan on your house.  But, rather than doing so for the amount you currently owe on your mortgage, your new loan will include the amount you owe on your home, plus cash to take out to apply to other non-mortgage debts.

When you tap into home equity, you can use the additional funds to pay down your loans and credit cards.  Imagine: making just ONE payment each month!  Using home equity through a cash-out refinance could not only lower your monthly payment, but could also eliminate the payments on high-interest credit card balances that never seem to decrease.

I’m one who loves examples, so let me show you how this works.  Let’s say your mortgage balance is $125,000 and your house appraises for $200,000, meaning you have $75,000 in equity you would take out a mortgage for $160,000, of which $125,000 is for the house and $35,000 is an equity withdrawal (lenders usually allow you to borrow up 80% of the home’s value).  You then use that $35,000 to pay off your credit card balances.  Slick, huh?!


A lot of people will find that going through a cash-out refinance with Mr. Cooper helps them reduce their monthly debt payments.  Check out some of these results (actual results may vary).

Think about what you could do with another $500 a month.  If anything, imagine what it would feel like not to stress about paying your bills and finally being able to sleep at night.


As with all loans, there are origination fees and closings costs for a cash-out refinance. However, I’ve got a unique way you can save $500! (Of course, I have a way to save – that’s the way I do things)!

Mr. Cooper is offering all Penny Pinchin’ Mom readers the opportunity to get a $500 loan discount!!  Just head to to submit the form, and a Mr. Cooper Mortgage Professional will reach out directly to talk to you.  That is all you need to do to claim this offer!

There is no reason to keep living like this.  If your debt keeps you awake at night or you find that you’re willing to give up a kidney to ditch it (yes, 7% of people would do this to get out of debt), there could be options.  You may not be able to do it as I did, but using your home might be a perfect way to help you finally catch your breath.

Important disclosure from Mr. Cooper: A debt consolidation refinance increases your mortgage debt, reduces equity, and extends the term on shorter-term debt and secures such debt with your home. The relative benefits you receive from debt consolidation will vary depending on your individual circumstances. You should consider that a debt consolidation loan may increase the total number of monthly payments and the total amount paid over the term of the loan. To enjoy the benefits of a debt consolidation loan, you should not carry new credit card or other high interest rate debt.

Nationstar Mortgage LLC d/b/a Mr. Cooper, 8950 Cypress Waters Boulevard, Dallas, TX 75019, (888) 480-2432, NMLS Unique Identifier #2119 ( ©2018 Nationstar Mortgage LLC. Mr. Cooper is a registered service mark of Nationstar Mortgage LLC.


The post What It Feels Like to Be In Debt (And How to Get Out From Beneath It) appeared first on Penny Pinchin' Mom.


10 Lies We Tell Ourselves About Debt

The post 10 Lies We Tell Ourselves About Debt appeared first on Penny Pinchin' Mom.

We all hear it repeatedly.  Debt is bad! But, when it happens, many of us try to pretend it is not that bad.  The truth is, we are lying to ourselves.

the lies you tell you about debt


While we know that this is how we should live financially, many of us just don’t listen.  Even I knew better and lead myself down a path of financial ruin (thankfully, I’ve recovered and will not allow it to ever happen to me again).

The thing is, I believed the lies and fell for the hype.  I did not listen to what the so-called experts had to say.  I just did what I thought was right based on what I was reading and had been told by others in my situation.  The sad truth is that I was just lying to myself.

If you are struggling with paying off your debt, these folks may be able to help:
Call 866-948-5666.

The thing is, debt is bad.  There is no other way to say it.  You don’t want it.  You don’t need it.  So why then, do we all continue to believe the myths and lies?  Perhaps it is because we just do not even know that is what they are.  Here are some of the lies I told myself when I was in debt — and hopefully I help you realize them too.




1. Debt is needed for my credit score

The thing is if you don’t need to borrow money ever again, why do you even need credit?  You may think that you can’t get a mortgage or a vehicle loan if you do not have a great credit score.  That is not true.  Many of them will, especially if you have no debt.

It has been years since we’ve been out of debt.  We cut up our cards in November of 2016.  Since that time, we’ve had a mortgage and one auto loan (which we paid off in just 4 months).  That’s it.  And you know what?  My credit is better than it was before I had the debt!  I’m in the 800 club now and proud of it.  I did not need a credit card to get there.  I did not need debt to build that score.

So, you may think you need debt to increase credit, but that is not the truth.


2.  Everyone has SOME debt

Nope.  Not everyone.  There are many Americans who have no debt at all.  Some do not even have a mortgage payment.  Just like I tell my kids “If everyone was jumping off a bridge, would you jump too?”  Of course not.  You have more common sense than to do that, right? Why then, do you think that just because everyone has debt that it is OK for you to have it too.

That was the way we thought about it.  We thought it was normal to have debt.  It turns out; we don’t want to be normal.  Maybe you should try it too.

Read More:  Creating a Plan to Get Out of Debt


3. I am not good with money

Sorry folks. That is not a good excuse. The internet has hundreds of thousands of resources available to help you learn about money.

If you don’t know about how to set up a budget, just Google it! If you are confused about how to set up a plan to get out of debt, you can Google that too.

We live in a time where information is quite literally at our fingertips.  The information is there.  You just have to go and find it.  No one is going to give it to you.  You need to do some work on your own.

Read More: How to Create a Budget (even if you suck at budgeting)


4. I deserve to spend my money

I agree with you on this.  However, you need to spend YOUR money.  Not money you do not have (which is what a credit card is).  If you don’t have the money in the bank to buy something, then you can’t just use a credit card.

It might make you happy in the moment when you buy it.  However, how will you feel when you are still paying for the expensive dinner out 6 months from now.  Probably not worth it as much when you look at it that way.

Read More:  How to Include the FUN STUFF in Your Budget


5.  We are in debt because of an emergency

I am not doubting anyone that sometimes, medical emergencies come up.  There are instances where you lose your job and must somehow get food on the table.  Those are emergencies.  These are things that you really did not know would happen.

Saying that you had to go into debt to pay your taxes is not an emergency.  You know that your taxes are due at the same time, every year.  That was a result of poor planning and is not an emergency.

It is essential that you have an emergency fund to plan for both the things you know are going to come up (such as paying taxes) and those that you may not expect (like the furnace going out).

Read More:  Ideas to Quickly Build Your Emergency Fund


6.  It was a great deal

The catch 22!!! Yes, we all love getting a great deal.  However, is it a deal if you are spending money on something you would not normally purchase?

This is all too common with people who start using coupons for the first time.  They see all of these little papers sharing savings on them and want to use them.  The sad truth is that many couponers actually spend more money when they start out than they realize.  They are trying to use every coupon.  However, if they are buying things they normally would not have on their shopping list, they are spending money just to save money.

The same is true with anything.  Just because you see that it is good deal or on clearance does not mean that it is the green light to go ahead and buy it.  Don’t spend just because.  Spend with a purpose.

Read More:  50 Ways to Save at the Grocery Store


7. I don’t have that much debt

Any debt is bad debt. It is the truth.  It doesn’t matter if you owe $50 or $50,000.  The fact is this – you have debt.  You have to take the steps on your own to eliminate your debt and change your way of thinking.


8. I just need to make more money

I don’t buy this one either. If you are already living beyond your means, what will more money do to help that?  Chances are you will live further beyond what you can afford.

More money is not a guarantee of not debt.  Look at stars who have had to declare bankruptcy because they have no money.  Just because you have more does not mean you can manage it well.

Learn to gain control of your money now – no matter how much you are making.  Only then, will a pay increase help you to pay off your debts.

Read More:  Defining Your Needs vs. Your Wants


9. I will start my debt plan next month

Why are you waiting? What is the reason? It is like a diet. People so often say they will start it on Monday and then come up with an excuse and say they will start the following week. Before you know it, 6 months have gone by and 6 more lbs. have been added to your waistline.

Start today. Don’t put it off. The sooner you start, the sooner you will be able to shout it loud – I’M DEBT FREE!


10. It is impossible to be debt free

I get this as I once thought the same thing. We were a one income family with two young kids and were struggling to live paycheck to paycheck. There was no WAY we could do it. I could not have been more wrong.

We talked to friends who were in the same situation and gained support from them. We knew we were not alone. Together we celebrated the little victories. The key was that we needed to remind ourselves that anything was possible. It took us 27 months, but that $37,000 in debt was gone before we knew it. And that was the best feeling in the world.

Read more about my family’s journey to become debt free.


Don’t fall for the hype. Stop trying to tell yourself these lies (and others you might be thinking about right now).  Only when you believe the REAL truth about debt will you be able to commit and work towards becoming debt free.

why am I still in debt

The post 10 Lies We Tell Ourselves About Debt appeared first on Penny Pinchin' Mom.


13 Ways to Get Out of Debt Faster

Whether you have credit card debt, car loans, student debt, or all of the above, owing money is no walk in the park. While it seems easy to get into debt, getting out of it…

The post 13 Ways to Get Out of Debt Faster appeared first on Crediful.


Convince Your Spouse You Need To Get Out Of Debt

The post Convince Your Spouse You Need To Get Out Of Debt appeared first on Penny Pinchin' Mom.

Need to convince your spouse you need to get out of debt?  You can’t just tell him or her.  You need to address it in the right way.

How to Convince Your Spouse You Need To Get Out of Debt -- Without Fighting!!

Getting out of debt and taking control of your finances is important to your relationship.  Whether you are just starting out or have been together for 25 or  more years, you have to be in the same page financially, or you will be destined for failure.

So, what happens if your spouse is a spender and you are a saver?  Or, what do you do if you want to create a budget you both contribute to, but your spouse refuses to help?  What happens if you want to get out of debt, but your spouse thinks you are fine?

These are questions I get over and over again from readers just like you.  Get my answers on what you can do if you find yourself in any of the following situations.



This is a very common scenario.  One person feels that there is too much debt and their spouse or partner thinks that they are doing just fine.  What do you do in this situation?  I’ve got the things you can try to help get your spouse or partner onto the same page as you.



Timing is everything when you are discussing debt with your spouse or partner.  If you casually mention it over dinner, it may not actually resonate that you are serious.

Set up a date with your significant other.  Carving out time to have a real, honest discussion about your finances can make all the difference.



When you sit down to talk, your money and finances should be discussed as “we” and never as “you.”

For instance, instead of saying “You are spending more than you make” – say “We are just spending a bit too much money lately.”

When you are in a relationship, your money is no longer yours and mine, it is ours.  Addressing your debt should be addressed in the same way.



If, after you have this discussion, your spouse is still reluctant to get started, take a break.  Circle back around a few weeks later and have another discussion.

The thing you do not want to do is nag him or her about it.  That will create more resentment and be much less successful in developing a plan you both can follow.


The main reason many people are reluctant to get out of debt is they fear that they will not be able to spend any money on anything at all.  That does not have to be the case.

Talk to your partner about your budget and show him or her how you can still leave money for dinner out or the weekly movie dates you love to have together.

One way that my husband and I do this is that we have a “mad money” fund.  This is money which can be spent on whatever we each want.  We designate an envelope for each of us.  When our money is gone, we are done spending.  We actually have turned this into a challenge to see which of us can actually go the longest without spending any money!  After a few months, we agreed that we both won and then turned around and used that money in planning a Disney vacation.

You are a team and together you will need to work up your budget so it works for both of you.



When you sit down for your meeting, don’t have everything planned out.  As tempting as it might be to have the budget all mapped out and show it, that may actually result in your partner being more resistant.

When you talk, take the time to truly listen to what your partner has to say.  Once he or she voices concerns, you will also have a chance to make your case.

When you show that you really do want to listen and work together on this journey, he or she may be much more willing to join you.  However, if you shut him or her out of the conversation, you will not be successful.



Once you both are on the same page with your debt, it is time to make a debt payoff plan. It should include a list of your debts and a way to track your success.  You will work together to achieve your financial goals.  Go through everything together and make sure you both agree to how much you will pay on the debt, your budget and much more.

Putting it in writing will help you both focus on the big picture and give you accountability to one another.  Before you know it, you will be on the path to financial freedom.



The post Convince Your Spouse You Need To Get Out Of Debt appeared first on Penny Pinchin' Mom.


How to Negotiate Credit Card Interest Rates

The post How to Negotiate Credit Card Interest Rates appeared first on Penny Pinchin' Mom.

Want to negotiate your credit card interest rate? These tips might come in handy.

How to Get out of debt - lower credit card interest rates to save money


We have shared many tips on how to get out of debt.  Another thing that many have tried to do is to lower interest rates.  But, how do you negotiate your credit card interest rate?  I mean, is that even possible? Yes.  It is.

What many people may not realize is that interest rates are not set in stone.  There is flexibility to the rate you are charged.  However, you need to make sure you approach getting it lowered in the right way.



Believe it or not – it does.  For instance, if you have a credit card with an interest rate of 18% and a $5,000 balance, you will pay in excess of $2,900 in interest alone over the life of the debt.

If you are able to negotiate your rate down to 10%, you would pay around $1,200 in interest.  That is a savings of more than $1,700!!  Keep in mind again that this interest calculation is based upon paying a minimum payment only – and nothing more.

If you know it will take a longer period of time to pay off your debts, a lower rate can help.  That will reduce the amount you end up paying back to the lender.



Before you make a the call, make sure you have done your homework  You want to be ready to talk with them about possibly reducing your rate.  Here are some things to keep in mind:

Do your homework.  A credit card company is not going to lower rates simply because you call and sound like a nice person in a financial bind.  That is just not it works.  However, they will consider it if you find a competitor who has a lower rate.

Keep in mind that they will not consider introductory rates, but rather, on going rates. They may be more willing to reduce your rat if you can provide you can get a better rate elsewhere.

Speak with the right person. If you are serious about wanting to negotiate your rate, ask to speak to a supervisor.  The credit card customer service rep usually does not have as much authority or flexibility in being able to reduce your rate.  By speaking to a supervisor, you may have better luck.

Call at the right time.  If you are struggling and really want to reduce your rate, allow your account to be delinquent for 90 days.  After that time, the credit card company realizes you are struggling to make payments and that may open up the conversation to a potential rate reduction.

The 91 – 179 day window is the best for possible rate reduction.  The reason is that once an account has been delinquent for a period of 180 days, they sell off the debt to a collections company.  This will result in their receiving pennies on the dollar for your outstanding debt.   They would be much happier on doing what they can to get a little less interest from you than little to nothing on your debt.

Be polite and honest.  Whatever you do, be nice to the person on the phone.  Being rude or impatient will not help your case – at all.   Make sure that you also do not lie.  Do not say you have never had a late payment on any card if you have not.  They can pull up your records and see if you are telling the truth or not.

If you are struggling to make your payments due to a job layoff, or illness, let them know.  If they realize you have little to no income, they may be more willing to discuss a rate negotiation with you.

Be prepared to be told no.  If you do not have a good credit history, your chances of receiving an interest rate reduction are greatly reduced.  In fact, you might take some steps to repair your history before you even attempt to make a call.

Consider closing the account.  If they refuse, you might want to just go ahead and close the account for future activity.  If you are trying to get out of debt, this might be the best solution anyhow.   Make sure that you tell that to the rep and ask for them to send written documentation of the same.

You may not be successful in getting your rates reduced. But, at least you will have tried.

No matter what you find out, continue making your payments on time.  Try to pay more than the minimum payment each month if you can.  If you still can’t get a better rate, you might consider opening a new card and transferring the balance there.


The post How to Negotiate Credit Card Interest Rates appeared first on Penny Pinchin' Mom.


How to Stop Using Credit Cards

The post How to Stop Using Credit Cards appeared first on Penny Pinchin' Mom.

The reason most people are in debt is due to credit cards. These little pieces of plastic tempt you with high limits and low payments.  They are simple to use and often a hard habit to break.  You have to teach yourself how to stop using credit cards and end the cycle of more debt.

credit card debt

According to the Federal Reserve, Americans have accumulated $992 billion in credit card debt (as of November 2016).  While many people pay them off every month, there are thousands of others who do not.

They just pay the minimum and then continue to use the cards, resulting in increasing debt. If you are serious about wanting to get out of debt, you have to take steps to stop using your credit cards and racking up more debt.

Read More:

  • Why Your Credit Score Matters and How to Increase It
  • How to Pay off Credit Card Debt
  • The Five Mistake People Make When Getting Out of Debt



It is so easy for someone on the outside looking in to tell you to stop spending. However, if it were that simple, you would have quit long ago, right? Before you can stop spending, you have to know why you are doing it.

Your reason could be to replace something missing in your life. It might be the high you get from spending. Your logic is not wrong. It is your own.

Once you understand why you shop, you can then start to work on that, and in turn, your desire to buy as much can slowly fade as well.  Knowing the reason why is one of the first things you must do finally break the cycle of credit card debt.

Read more:  Why you continue to overspend



I know that this is pretty extreme, but the truth is that it works.  If you do not have cards to use, you can’t rack up additional debt.

If you are nervous about getting rid of them altogether, put them on ice.  Literally. Put your credit card in a bowl of water and freeze it.  When you feel you need your card, it will be more challenging to get to, and the urge to use it may pass more quickly.



One thing that goes hand-in-hand with cutting up the credit cards is sticking with cash.  That doesn’t mean a debit card.  It is using paper money.

When you use cash, you have to think twice about what everything costs.  When the money is gone, you can’t spend any more.

When you use a debit card, you can still spend more than you intend.  That is never the case with cash.

If you have $100 to spend with cash, you can not make a purchase that is $105.  But, with a debit card, you still can.

It is far to easy to swipe plastic.

Read more:  Setting up and using a cash budget



A simple trick to sticking to not using your cards is to set up milestone rewards.  For instance, if you can go one week without using your card, allow yourself an extra coffee the following week.

As you reach more and more milestones, such as paying off a card, going six months without using plastic, etc., set up small rewards for yourself.  Just make sure that you never cover the cost of your reward by using your credit card!!



If you want to stop using credit cards and pay off your debt, it is helpful to have a goal in mind.  It may be to afford the new car you want or buy a home. It might even be to live without feeling so much stress.

Whatever your reason, create a vision board.  When you have a clear vision of what will happen when you reach your goal, the more likely you are to stay on track.



The best way to stop is to have someone to help keep you on track.  An accountability partner can do just that.

If you are in a relationship, you will be accountable to your partner (of course).  However, if you both have a difficult time not using credit, you might want to look beyond yourselves.  Find another couple who is in the same situation as you are and become accountable to one another.

However, if you are single, then it may be a bit more challenging to find someone.  Reach out to friends and family to find someone with whom you can connect and help one another.



When you have a cash budget, you get into the habit of doing this.  However, if you are not ready to make that leap, start tracking every purchase you make.

Sometimes, seeing where you spend your money can be enough to make you want to throw the credit cards away for good.

Read more:  How to track your spending



You absolutely must have a budget.  There is no way to get around it.  But, more than just a budget, it needs to be a budget that works.  Sit down and go back over your budget to see where you may be spending too much and see if you can find ways to make improvements.

Also look carefully at how much money you spend on credit card debt each month.  Imagine what you could do with that money if you did not have to send it away to someone else.

Read more:  How to create a budget that works


Put some simple strategies to work and you’ll stop using credit cards and can get in control or your money.  Finally.

stop using credit cards

The post How to Stop Using Credit Cards appeared first on Penny Pinchin' Mom.


8 Easy Ways to Improve Your Credit Score In 2021

improve credit score

It’s been a difficult time for everyone. But coming into the new year, many have found the past twelve months have landed them with lower credit scores than ever before. This can damage not only your financial reputation, but also your prospects. So, what’s the effect of a high or low credit score, and how can you improve yours? 

Why Is a Good Credit Score Important?

It’s like a digital record of financial viability, which is reflected in a credit score. Purchases made using credit cards and monthly debt repayments boost your score. A low credit score makes borrowing money, securing credit cards with good interest rates, or qualifying for a mortgage difficult. Conversely, maintaining a good credit score can:

  • Increase loan amounts available      
  • Lower interest rates on loans
  • Increase the probability of loan acceptance
  • Provide access to buy now, pay later credit offers

Boosting Your Score Is Easy

Knowing everything about your credit score is important. So, you must check it whenever possible to see where you can give it a boost. Let’s discuss eight easy ways to improve your credit score In 2021.

#1 – Know Your Score with a Free Credit Report

To improve your credit score, you need to know what it is. There’s plenty of companies out there that can give you a free credit report card, such as TransUnion, Equifax, and Experian. Most of these provide paid services to keep on top of changes. If you have the spare income to subscribe, it can significantly help your credit score. Keep reading to find out how.

With companies like Experian, you are entitled to one report free annually. And you may even be eligible for another if you’ve recently been refused a loan or employment based on a poor credit score.

Get Your Free Credit Report Card

#2 – Check If Your Report Is Accurate

Identity theft and credit fraud are rife these days. Once you have your report, take the time to review your accounts and dispute any you know aren’t right. Even if you don’t get lost money back, having false debts removed from your credit report can boost your score.

#3 – Pay Your Bills on Time

Perhaps the most frequent cause of lowered credit scores is late payments. To give your credit a boost, make sure to pay any bills and loan repayments on time. Using direct debits is a reliable way to make sure payments reach their destinations on time. And monthly reminders on your phone or work computer can help if you’d rather not automate your payments.

#4 –  Open a Secured Credit Card

The main benefit to get this card is that you’re more than likely to get approved if you don’t have stellar credit. You’ll need to make a deposit upfront. And they often don’t require a credit check to apply. Another huge benefit is you’re going to build your credit just like any normal credit card would, if the issuer reports to the credit bureaus. When choosing any credit card to help boost your credit, make sure they report to the bureaus before applying. 

Compare Secured Credit Cards

#5 – Get a Credit-Builder Loan

To get a credit-builder loan, you don’t need to have a good credit score. You just need to prove that you have enough income to make the payments. 

You regularly can’t get to the cash until you have completely reimbursed the advance, which implies you can work on your savings and your credit simultaneously.

#6 – Check Your Credit Report for Errors

The first thing to do is to look at your Credit Report. Second, You can get one from each of the major bureaus. You’re entitled to a free copy every 12 months. Once you receive these, pay detailed attention to any errors such as an incorrect address, the spelling of your name, open accounts being reported as closed, outdated information, and many more. Check here for more information.  

#7 – Get a Credit Card, and Request More Credit

Spending credit is the best way to earn better credit. So, look for a credit card that fits your needs. You can use it for predictable expenses you can pay off as soon as you get paid. Simply using the card and paying it off at the start of every month shows you can use credit responsibly, which should allow you to request more credit to use and improve your debt ratio, which also affects your credit score. These things can help boost your credits score effortlessly.

#8 – Patience Is a virtue

Repairing your credit score won’t be fast or without hurdles. Take your time to think through all your financial choices, limit your access to new credit avenues unless they fit into your overall credit goals, and keep on top of payments. It may take months for the results to show, but once they do, it’ll be worth it. Hang in there!

Do you want to write a guest post for us? Check out our guest posting guidelines here and get in touch!

The post 8 Easy Ways to Improve Your Credit Score In 2021 appeared first on


Interest Rates vs. Balances: Which Do You Pay Off First?

The post Interest Rates vs. Balances: Which Do You Pay Off First? appeared first on Penny Pinchin' Mom.

If you are trying to get out of debt, there is a lot of discussion as to how you should pay off your debts.  Some experts say it should be paid off by the lowest balance and others say the higher interest rate?  While there is not a “right” way to do it, I will share what we did to get out of debt and the reasons why.

how should I pay off my debt

First of all, let’s talk about credit cards and why it is not good to carry a balance.  When you owe on your credit cards, your interest keeps compounding and that increases the amount you owe. Here is an analogy for you:

If you have a large fire going and dump a cup of water on it, you will do nothing.  You might make the flames go down for a minute, but they will return.  At this point, you need to figure out a way to really tackle it and get it under control.

However, if you dump a bucket of water on that same fire, you may not put it out completely.  But, you will probably make it smaller.  If you throw two or three more buckets it, you can actually extinguish it.

The same is true with credit card debts.  When you make small, minimum payments you are throwing cups of water on a fire.  However, if you send in a larger amount, you can actually pay it off much more quickly.  But of course, you can’t send in larger amounts to everyone at once, so you have to prioritize.


There is a lot of discussion about paying down higher interest rate cards first or those with a lowered balance first. There is no right or wrong answer, as it will be different each time you talk to another expert.

Both options are listed below.  Read through them carefully to determine which is the right one for you.


Many financial experts will recommend that you list your debts in order of the interest rate, from high to low.  Then, focus on paying on the one at the top of your list first.  They recommend this method as the one with the highest rate is the one which usually will cause you the most financial stress.

Your monthly payment is around 4 – 5% of the balance  That means if you pay the minimum payment, 95% of what you pay is strictly paying interest.

For instance, if your rate on a $1,000 loan is 15% and you pay $40 each month, it will take you 5 1/2 yrs to pay it in full! OUCH!   During that time, you will have paid out more than $360 in interest alone – double OUCH!!  That makes your $1,000 purchase now $1360 (and chances are what you bought has not appreciated in value).

Start by making larger payments on the loan with the highest rate.  Continue making the minimum payments on your other debts.  Once you get the first debt paid in full, roll the amount you were paying on that card to the one with the next highest rate.

The only downside to this method is that it may take you a long time to pay the balance in full.  That might lead you to get discouraged – but don’t let it! If you find that you feel this way, perhaps you should consider paying the lowest balance first, which we explain next.



We followed this method when paying off off our debts. It was the right answer for us and countless others.  The reason it can work better is realizing faster progress.

To begin, list your debts by the least amount owed down to the greatest.  Toss any additional funds you can at the bill with the lowest balance.  Continue making your regular minimum payments to the other debts on the list.  As you get this each debt paid off, roll those payments to the next one and continue until all debt is eliminated.

You may end up accruing more in interest, but you might be better off psychologically.  When you can see that you are making progress, you will be more likely to continue and not be as quick to quit otherwise.

Paying down debts in this method allows for short-term, attainable goals and that can make all of the difference.



Whichever way you decide to tackle those credit cards, it is good that you are doing just that.  While there is no such thing as good debt, credit card debt is the worst debt.  One day you will be able to live a debt free life — and it will be the most amazing feeling in the world!

If you are just getting started trying to get out of debt, catch up with our other steps shared previously on our How To Get Out Of Debt Page.

pay off debts by balance first

The post Interest Rates vs. Balances: Which Do You Pay Off First? appeared first on Penny Pinchin' Mom.