1. Money

7 Reasons It's So Hard to Pay Off Debt

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Paying off debt is not without challenges. If you've tried, or even thought about, getting out of debt, you've probably already realized how hard it is. Here are a few reasons that getting out of debt is so hard.

You have to change your lifestyle.

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© Noel Hendrickson / Digital Vision / Getty Images

To get out of debt, you have to make some major changes to your financial life. When you went into debt, you were likely spending more money than you were bringing in, relying on credit cards and loans to buy things you couldn't really afford.

You've undoubtedly gotten used to the lifestyle you lead, but you must change it if you want to pay off debt. For example, if you’ve been accustomed to eating out several times a week or month, you’ll have to cut way back, even better if you stop completely. It’s not easy to make the lifestyle changes that are necessary to get out of debt, but you can adjust to life without things you can’t afford.

You'll have to sacrifice things you want now.

Paying off debt requires constant sacrifice. It’s hard to do that since we’re continually flooded with advertisements for goods and services we don’t really need. As long as you’re paying off debt – and even when you’re finished – you have to say “no” to things – vacation, electronics, jewelry, etc. – that will hinder your debt repayment progress.

High finance charges take much of your payment.

The higher your interest rates, the longer it will take you to pay off because much of your monthly payment goes toward paying expensive finance charges. You’ll have to increase your monthly payment or talk your creditor into lowering your interest rate if you want to make real progress paying off that credit card balance.

Everyone else is spending money to their heart's content.

Debt repayment can be extremely difficult when you’re making huge sacrifices to get rid of the debt while everyone around you buys, borrows, and spends whatever they want. That spark of jealousy might tempt you to reconsider paying off your debt, especially as you think back on the carefree life you lived when you also spent money at your leisure.

The joy of buying things is short-lived, especially as your borrowing power runs out and you’re forced to repay all the money you’ve borrowed. Occasional indulgences are ok. Just keep your purchases small and infrequent.

Your spouse/partner/family may not support your debt repayment.

If you’re married, in a serious relationship, or have kids, you need those people to support your decision to get out of debt. Not only do you need their encouragement, you also need them to understand your financial decisions. Your family will also have to adjust to lifestyle changes. For example, if you decide to cut out cable television, the family will have to find other ways to entertain themselves.

Unexpected expenses will arise.

Though you may do what you can to safeguard yourself from unexpected expenses, you’ll sometimes have to deal with something you didn’t plan for. That’s why it’s important to have an emergency fund that you can withdraw from when unexpected expenses arise. An emergency fund softens the blow from unexpected expenses and keeps you from having to borrow money. You’ll have to rebuild your emergency fund, possibly from your debt repayment funds, so you’ll have money available the next time something unexpected happens.

It can take a long time.

Paying off your debt can take several years depending on the amount of debt you have and the amount you’re able to put toward it every month. It will take even longer if you add more debt or you pay just the minimum. You might get discouraged after months or years of paying debt with minimal progress.

Go into debt repayment with an idea of how long it will take to pay off your debt. Every few months, use a debt calculator to figure out how much longer you’ll pay on your debt with your current monthly payment. That checkup will give you an idea of where you stand and keep you from feeling like you’re wandering around in a debt repayment wilderness.

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