I have learnt over the years that debt is bad. Why? Because it prevents you from becoming wealthy. Money paid to others is less money for yourself. If you always have a car payment, or borrow for school, or only make the minimum payment on your credit card you will struggle to become wealthy. A $500/month car payment can prevent you from being a millionaire. Which one would you prefer? I know which one I would pick.
Once you accept that debt is bad, you have to learn the best way to pay off the debts. Most financial gurus will tell you to pay off the highest interest rate first. I disagree. Following the Dave Ramsey Debt Snowball Method, you should pay off the smallest debt first. Why? Because of the emotional boost you receive from accomplishing something. As you pay off each debt, you will gain confidence and feel relief. And if your argument is that mathematically that doesn’t make sense, my counter would be that if you followed math you wouldn’t be in debt in the first place. After all, how does it make sense to spend more than you can afford?
Paying off debt will not be easy. You will have to make hard decisions and sacrifices. You may have to sell a car or two. Postpone vacations. Get a second job, or even sell your house. But you have to act rationally and have a game plan. And most importantly, don’t ask broke people for financial advice. Sit down with a financial coach. Reach out and I will help you conquer your debt.