Is This Why Your Debt Clearance Strategy Isn't Working? ...

You can have every intention of paying off debt, but if you don't have an emergency fund, this is one of the reasons why your debt clearance strategy isn't working. Unexpected expenses are going to arise – there's no way around this. And if you don't have a cash cushion, one emergency will send you back into debt.

If you're stuck in a routine of only paying your minimums each month, your debt strategy isn't going to work. Minimum payments will decrease your balance, but not by much. For a noticeable difference, you need to increase payments.

Do your friends like to spend money and use their credit cards frivolously? If so, their bad habits might rub off on you. Getting out of debt is often a matter of surrounding yourself with people who spend money wisely. Financial peer pressure is real, and if you don't recognize it, you might never get out of debt.

Be honest, how do you expect to pay off credit cards if you keep them in your wallet? For your debt strategy to work, you need to remove any and all temptation. This might include freezing your credit cards, cutting them in half or locking them away. But if you don't want to take extreme measures, you need to at least remove cards from your wallet.

There's nothing wrong with building reward points to earn discounts on hotels, airline tickets, and merchandise. But if you're using your credit card on a regular basis to accumulate reward points, you need to pay off new charges each month. If not, your debt clearance strategy isn't going to work. The opposite will happen and you'll add new debt on top of your existing debt.

Unfortunately, if your income isn't enough to cover your monthly expenses, you might rely on your credit card for important things, such as gas, food and other bills. Before you can pay off debt, you'll need to generate extra income. Maybe you can take on additional work, or maybe you can reduce expenses to create more disposable income.

Having good intentions isn't enough, you need a plan. For example, you need to determine how much you can realistically apply to debt each month. Then, you need to set a debt payoff goal. Other tactics also help pay off debt sooner, such as negotiating a lower interest rate and using free money to pay down balances faster. Free money can include a work bonus, a tax refund or gift money.

The fact that you want to pay off debt is commendable. But unfortunately, getting out of debt isn't simple, and you'll need to recognize factors that keep you in debt before you can make any progress. What are other reasons a debt clearance strategy fails?