Personal Finance

The Most Common Types of Debts (& How to Get Out of Them)

  • Mark Edwards ·
  • August 3, 2022

Getting out of debt is something on all our minds, especially with things the way they are right now. The problem is that a great deal of the modern world works on debt, and that means many of us have gotten used to being in debt as a way of life. The good news is it’s possible to climb your way out of debt, or at the very least minimize them and keep them under control so they don’t negatively affect your life. Read on to find out how. 

Credit card

Probably the most common type of debt that many of us face is our credit cards. You know those shiny rectangles of plastic that allow us to have just about anything we can want without having to wait for it! 

Unfortunately, credit cards don’t tend to be free over the long term, which means you not only have to pay back what you owe but the additional interest that is charged on top, something that can make it very hard to get out of debt. 

With this in mind, there are a few tactics that can help with credit card debt. The first is never to spend more than you can afford to pay back at the end of the month. Although, if you are already past this stage then transferring your balance to another card with more favorable rates can help. Indeed, if you can find one that offers 0% finance for a period, you may have enough time to get back on top of things and clear your debt. 

Medical Debt

For many people in the USA, medical debt is a hole they struggle to climb out of. This is because emergency medical care provided to those after they have been in an accident can be so expensive, while also not expected at all. 

Of course, this leaves many either paying for the things that are not covered by their insurance, or paying the entire bill and having to use hospital credit. 

That is why many people that are involved in accidents that are not their fault work with a legal team like the one you can find at to recover their medical costs in court. Indeed, taking the responsible party to court can lead to compensation that can cover both your medical costs and any loss of earnings that could further complicate your debt situation. 

Payday Loans

Payday loan debt is like credit card debt on steroids. That is, you’ll end up paying back more than you borrow in the form of interest, but the interest on a payday loan can be massive compared to other types of borrowing. 

Their marketing can feel very seductive too as many payday loan companies emphasize how easy it is to get the loan, and how much control you have over it. 

To that end, avoiding payday loans where you can is best. However, if you have payday loans that you are struggling to pay off, you may want to consolidate this debt. Then you will stop incurring more and more interest that makes them even harder to pay. 

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