7 Mental Armors For Getting Out of Debt

Posted by Fitz Villafuerte under Mindsetting, Personal Finance on April 10, 2015

I used to have five credit cards, and drowning in almost P200,000 worth of debt.

It actually reached a point where collection agencies would make rude calls to me, and send fake summon letters from law firms to my address.

At first, I ignored them. I was not affected because I knew those were all empty threats.

But then they got hold of my parent’s home number, and all it took was just one phone call to break my mom into tears.

When I learned what happened, I knew it was time to change or else I’d risk hurting more people that I love.

So I decided to confront my debts.

I started by creating a budget. I began tracking my expenses. And I discovered the Debt Snowball Method, which tremendously helped.

After three years, I was debt-free.


Whenever people ask me how they can pay off their debts, I’d normally advise the above steps that I did.

Create a budget. Track your expenses. Do the Debt Snowball Method.

However, I realized that these are easier said than done. And it requires a certain kind of mindset to succeed in the end.

Thus below, I’m sharing the seven mental armors I wore to win my fray against debt. Equip yourself with these and you’ll be closer to victory in your battle.

1. Accept that you have a debt problem.

Awareness and acceptance is always the first step towards change. Have the courage to admit to yourself that you are in serious financial trouble.

Moreover, recognize the fact that this is not a permanent problem, and you have the power to overcome it just like many others have already done before you.

2. Tell yourself that there will be no more running.

Being in debt is like standing in front of a rabid dog. You should not turn your back and run away from it because it will attack if you do.

Instead, you need to stay calm, assess the environment, and find the best way to neutralize the situation and bring yourself to safety.

When faced with a seemingly unsurmountable debt, it’s also best to stay calm, assess your options, and find the best strategy to pay it off as soon as possible.

3. Look forward to making a lot of changes in your life.

If you keep doing what you’ve always done, nothing will ever change. So if you want your debts to disappear, then it will be necessary to change how you live.

Your daily routine will change, your spending habits will change, your lifestyle will change and in some cases, your set of friends will change too.


4. Put more focus on creating income.

There are two ways to come up with the money to pay your debts – lessen your expenses, and earn more income.

Unfortunately, simply eliminating your unnecessary spending won’t work fast enough to pay off your debts as soon as possible. So if you want to turbo charge your finances, then you really need to increase your cashflow.

Keep your worries at bay and focus more of your time and energy into creating streams of income. Get a second job, do freelancing, sell your stuff – be proactive.


5. Expect that it will be difficult.

If it’s easy to get out of debt, then nobody will have this problem. So don’t fool yourself that it will be a walk in the park, because it will be a traverse in the jungle.

No, I’m not scaring you – I’m just being realistic.

Eliminating your debts will be a big challenge, but in the end – it will be one of the greatest achievements that your friends and loved ones will always remember about you – an accomplishment that you will forever be proud of.

6. Be ready to face and overcome self-pity and depression.

Calls from collection agencies will continue and letters from law firms will relentlessly come; meanwhile, the world around you will carry on and move forward without sympathy. Paying off your debts can be a lonely battle, but you don’t have to be alone.

Find joy and comfort in the listening ears of friends and loved ones. Don’t be afraid to talk about your fears and hopes with them because it will help, a lot.


7. Always remember that your debts do not define who you are.

I got myself deep in credit card debt because I was a reckless and impulsive buyer. I swiped my card buying a lot of things that I didn’t need, to impress people I didn’t even like. Yes, I used to be a shallow and materialistic person.

But then I realized that I can be a different person – a better person than who I was at that time.

At that point, I stopped listening to the names that collecting agents called me. I shut my ears from the gossip that was going around the office about my troubles. I refused to let my financial mistakes define who I am.

Instead, I chose to be the good person that I know I can be – that I knew exists within, if only I give it a chance to come out.

It took me three years to finally get out of debt. When I started taking charge of my finances, I thought it would take ten years.

If you’re trying to get out of debt, it will feel like it’s never going to end. But believe me, things will always get better and it will be over sooner than you expect.

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Photo credits: Σταύρος


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10 Responses to “7 Mental Armors For Getting Out of Debt”

  1. Nicely says:

    Very helpful! Thanks, Fitz!

  2. Erika says:

    Will paying off your cc debts clear your name from list of people blacklisted by financial institutions? I heard that even if you’re already fully paid, your name is still on the list and regarded as high-risk by banks.

  3. Khayz says:

    Thanks for sharing! So far the only debt that I have is my SSS salary loan. People told me to use so as to prevent unwanted individuals from tapping my resources ^_^

    I’ll keep this in mind once I

  4. Bernie Sulapas says:

    Thanks Fitz..

  5. jeanette says:

    and now you are one that i consider mentor. a good one too . well, blessing in disguise .

  6. Fitz says:

    Yes, your name will remain in the blacklist even if you pay your cc debts. It will be removed automatically after 5-7 years according to a friend who works in Citibank.

    I believe that is not true. But in any case, if you are eligible to avail an SSS salary loan then you should consider leveraging it to make some money because it’s interest rate is really low as compared to personal loans from banks.

    But don’t take out an SSS loan and just spend the money recklessly. Use the cash to buy and sell something, or start a simple business.

  7. Quirk says:

    Hello Fitz,

    Is it wise to consolidate your debts through availing a personal loan? If not, are there any more methods to paying off credit card debt?

    Thanks! 🙂

  8. Fitz says:

    Hi Quirk,

    In most cases, it’s not a wise choice because you’ll only incur more interests as most personal loans have higher rates than credit cards. My advise is to do the math and simulate your payments in a worksheet to see if it’s really worth it.

    Also, I am not aware of any more methods that is as effective as the Debt Snowball Method (and it’s few variations). So I suggest you study that more.

  9. edelweiza says:

    Yes, it can be done! Lifestyle change and financial empowerment are everything! My credit card troubles before may not be as hard, but it still required a lot of determination from me. Paid all my CC debts in a year’s time, but the amount is lesser than yours was. 🙂

  10. chon says:

    Thanks for sharing this post it somehow lighten my burden with my cc problems. pwede po mag tanong, i would like to cut off my cc and pay my account balance in a staggered term pwede po kaya yun? do i still need to write a letter or i’ll just call their collecting department and negotiate? thanks po

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