I met this gentleman (let’s call him Mr X) at another party I attended. We did the usual chit chat and when he heard that I ran a credit card web site, he started to get really interested.

“So do you have any advice on credit card debt?” was his question. “Yes was my answer”, although I explained to him that my site focused more on credit card reviews and my blog posts are credit card related and personal finance related with some debt reduction posts. It turns out that the reason he was interested in what I was doing was because he was on the verge of getting rid of his credit card debt (which peaked at $25,000).

What he told me was very interesting. He said that the key to his credit card debt reduction was when he decided to face it and acknowledge it. He originally had about $18,000 in credit card debt from his student days. But he did not want to face it. So the debt slowly spiralled. he thought that afterall, if he added another $500 to this $18,000 debt, it did not make a difference. Well, after a few $500 additions, the total at the peak reached $25,000. That was when Mr X realized that he cannot afford not to confront the fact that little additions add up and do indeed snowball.

It finally dawned on him that if he just did the reverse and reduce his debt bit by bit, then he will be debt free before he knew it. To help him face up to this debt, Mr X placed a note on his table, bathroom mirror and bedside table with the amount of credit card debt he had. This way, he had to “face it” everyday. It stuck in his head and he started watching his spending, setting a budget and setting a plan to actually get rid off the debt.

I asked him to write a blog post for me but he refused. Instead, he said I can quote him anonymously! But he wanted me to convey the fact that the road to a debt free life begins with the acknowledgement that you are in debt. Once you have accepted that, a huge load will be taken off your shoulder and you can then begin to take the necessary steps to reduce your debt. If you do not acknowledge or face, all that will happen is that you will incrementally increase it, and before you know it, it will spiral out of control.

This entry was posted on Friday, March 2nd, 2007 at 21:09 and is filed under Personal Finance & Frugality. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.