Get out of debt for good By Christina Katz If you find yourself drowning in credit card debt, take heart, you are not alone. Americans charge over one trillion dollars per year on Visa, Mastercard, Discover and American Express. All these purchases "on plastic" would be fine if we all paid our balances in full each month -- but that's not the reality. There are roughly 1.2 billion credit cards in use in the United States with the average household balance of $9,000 according to Bankrate.com. Reversing Drastic Debt Juliette Swanson* was shocked when she realized that she had charged $60,000 in credit cards debt. "Although my husband and I were making over six figures combined, I was definitely living beyond our means," she says. " A new business suit here, a spa trip there, a nice dinner out... debt just insidiously kept creeping up. I felt like 'I work hard, I deserve this,' but I began to dread opening my credit card statements each month. I denied that there was really a problem; yet, I would hide the bills from my husband so that he wouldn't get mad at me. When I began to pay one credit card bill with another credit card, I realized my spending was out of control. I had a good cry, cut up my cards, and called Genus." Genus is a national, nonprofit organization offering debt management and educational programs that help financially distressed families and individuals effectively manage their money. Credit counseling agencies, such as Genus, act as intermediaries, negotiating reduced interest rates and waived late fees for participants in their program. Swanson spoke to one of Genus' debt counselors over the phone, completed their application and mailed it in with a calculated monthly payment amount to enroll in their program. Every month, Genus distributes Swanson's monthly payment to her various creditors. "That was two years ago," reports Swanson. "In another year, we'll be out of credit card debt completely. This rather humbling experience has taught me to respect money without using it to meet my emotional needs. I stick to a budget and really appreciate the extras that I choose. I use my debit card instead of a credit card so the money comes right out of our checking account. The amazing thing is, after the initial 'grieving' about letting go of the credit cards, I really don't suffer anymore." Another reputable nonprofit credit counseling agency is Solutions, a company based out of Seattle and affiliated with Consumer Credit Counseling Services. According to Vice President of Marketing Michael Ertl, Solutions offers clients relief before their debt situation reaches astronomical proportions. "We help folks with the $1,000, one-creditor challenge as well as assisting those that have 15 - 20 creditors. Amounts range anywhere from $1,000 all the way up to $100,000. Typically, they're in the $15,000 to $25,000 range." Solutions also offers money management workshops to program members, the community and schools throughout the greater Seattle and Portland areas. If your debt situation feels unmanageable, and you'd like to find a reputable credit counseling office in your region, visit the National Foundation for Credit Counseling. Or contact American Financial Solutions. Addressing Moderate Debt According to author Mary Hunt in her book, "Debt-Proof Living," it's not how much money we make, but what we do with it that matters. Hunt explains in plain terms the difference between "intelligent borrowing" (such as for a home that will increase in value) and "stupid debt" (such as a couple of movie tickets and dinner in a fancy restaurant). Hunt offers a Rapid Debt-Repayment Plan that teaches readers how to debt-proof their lives. "Without a plan," she says, "you're dreaming." Purchasing manager Michelle Hanson's proactive response to $10,000 of accumulated debt would have made the pragmatic Hunt proud. "Once I made the decision to get out of debt, I made sure I didn't charge anything more. I had multiple cards, so I kept one for emergencies and cancelled the rest. I didn't consult any professional agency, but I did consult my father who helped me create a budget for myself ‹ something I'd never been able to accomplish on my own. Every time I got a bonus or extra money I would put it towards the outstanding balance I carried … Now I am out of debt, except for my low interest mortgage and home equity loan." A demo version of Hunt's Rapid Debt-Repayment Plan is offered on the online version of her phenomenally popular newsletter, "The Cheapskate Monthly." Practicing Realistic Spending Get out of debt and stay out of debt, are words to live by for Editor Lisa Laskey and her family. "By the time I met the man who would become my future husband, I was in more debt than I could handle. After a few years together, my husband's thrifty ways and his parent's great financial modeling helped me learn the importance of living within our means and not planning to pay it off "next month." This may sound unexciting and not spontaneous to some, but it has gotten us through many lean years and insures that we will enjoy the extra income of the non-so-lean years." Here are simple financial principles that keep the Laskey family in the black: Buy what you can afford. Put on a credit card only what can be paid off on the next bill. Pay cash whenever possible. Don't impulse buy. Read and evaluate best buys and products that will last. Eat out seldom in order to afford regular vacations. Save for a rainy day. Always celebrate birthdays, Christmas and other holidays. But, during leaner years, set a lower gift-giving budget to avoid paying off debt for 11 months. As these three women discovered, getting out of debt makes good sense. Real financial freedom comes not from splurging on every whim and want, but from living contentedly within our means. So if you're drowning in debt, don't despair, follow their simple examples and soon you'll get beyond treading water and be swimming for shore. * Not her real name Recommended Books:: • Nine steps to Financial Freedom • A Girl Needs Cash: How to Take Charge of Your Financial Life Also see: • Financial calculators • Estate planning checklist Christina Katz is an writer, writing instructor, and writing coach from Wilsonville, Oregon. Christina is currently writing a book about how women make time for themselves and how you can too. If you would like to share your insights, please do not hesitate to contact her. For more information e-mail christinakatz@earthlink.net or visit http://www.christinakatz.com.