Getting Through Hard Times When You Have Debt

By Jackie Beck   Updated 05/05/2021 at 12:08 pm

It’s frustrating when you feel like you can’t even plan for next week, let alone for the distant future. Uncertainty can be very hard to deal with. Add debt to the mix, and being able to get through hard times can get even harder.

But it IS possible to get through hard times.

And while it may not seem like it at all right now, sometimes tough times end up being the catalyst that changes your life for the better.

We’re all going through the pandemic right now, with some areas — and many people — hit much harder than others. So there are a whole lot of things you might be worried about.

Times are tough right now

Maybe you’ve been laid off or furloughed, and now the $600 a week federal unemployment boost is gone. (Heck, with 45.4% of Americans unemployed right now according to the Bureau of Labor Statistics, it’s highly likely that you are one of them.)

Maybe you’re afraid you’re going to become homeless. Or you’re struggling to find enough food for your family. You might be wondering whether or not to send your kids back to school. You might be self-isolating due to being high risk, and feeling lonely.

There are so many stressors right now, and it’s overwhelming for a whole lot of us. If nothing else, maybe take some comfort in the fact that you are not alone.

And on top of all that, you have debt. So how do you get through hard times when you have debt?

(Note: If you are thinking of suicide for any reason, please read this post. You are still a good person and you matter.)

Focus on basic needs first

First, know that while debt can feel very pressing (especially if debt collectors are harassing you, it’s not as important as making sure you have your basic needs met.

So focus on those basic needs first.

For example, if you already have a home or apartment, do what you can to try to stay in it. Many areas have temporarily stopped evictions, so google “eviction moratorium” and the name of your state or county to see if that applies. You will likely have to show that you tried to work with your landlord or mortgage company if you can’t pay, and there might be other steps you have to do as well.

Finding housing-related resources

You can also google phrases like “rental assistance” and “CARES act rent relief” plus the name of your area to find resources that can help. Investopedia has a nice guide on how to get mortgage relief. If there’s nothing in your area, keep trying as things are changing often.

Finding food-related resources

The same goes for getting enough food. There is NOTHING wrong with using a food bank. Hard times like this are exactly what they are there for. Some food banks even deliver, especially if you’re a senior citizen or disabled. Apply for SNAP benefits now as well if you are struggling. Join your local Buy Nothing Group. (At least in my area, people often give away food on there.) There’s nothing wrong with reaching out for suggestions on NextDoor either.

Finding other resources during hard times

Doing a search for “community resources covid” plus your city or county may also be helpful as many cities and counties have put together lists of useful information. has an entire coronavirus resources section that could help.

Once you have your basic needs met, you can start to think about repaying debt

If you do have enough of a steady income right now, since this is such a huge and ongoing emergency, setting aside money for your emergency fund vs. aggressively paying down debt can be smart. (Make at least minimum payments if you can.) If you have enough of an emergency fund and income, and are wanting to pay down debt, the debt snowball method is great.

But what if you can’t pay all of your debt payments right now? If you are about to fall behind on your payments, your creditors may offer a hardship program. The first step in qualifying for one of the relief programs is to call them and let them know you are having trouble due to the coronavirus emergency.

According to the Consumer Financial Protection Bureau, “These programs may include allowing you to temporarily delay or adjust some payments. In some cases, you may be allowed to avoid interest charges. You may also be able to avoid negative credit reporting if you enroll before you become late on your payments.” But you have to reach out to your lender to try to get the help.

If you have federal loans, you can usually defer them or put them in forbearance.

You can also prioritize your debts

You can put your debts in order from most to least important. Pay the minimum payments on the most important ones first if you can’t pay the minimums on all of them.

For example, out of these debts:

  • mortgage on your house
  • car payment
  • credit card or personal loan
  • home equity line of credit on your house
  • student loan
  • mortgage on a house you rent out

The mortgage and home equity line of credit on your house would often be most important. That’s because if you don’t pay them for a long enough period of time, eventually the lender could foreclose and take your house. If that happens, it’s not the end of the world — plenty of people have gone through a foreclosure and still found someplace to live — but trying to avoid it can be a good idea.

The least important would be a credit card or a personal loan, because you don’t live in them. Credit cards are unsecured loans. Unsecured loans don’t have collateral backing them. Of course you they will still try to collect what you owe, and you might end up being taken to court, but that’s not as bad as not having somewhere to live. Note: This is likely also the reason some credit card companies are reducing credit limits right now in general. They know that hard times are here, and that their risk of not getting paid is increasing. If that happens to you, it’s probably nothing personal.

Other types of debt would fall somewhere in the middle, depending on your situation.

What if you can’t pay your debt at all?

If you just can’t pay, bankruptcy may also be something you could do. There are different kinds of bankruptcy. You can file it without a lawyer, but it’s a VERY good idea to use one if you there is any way you can. Here is some information on bankruptcy from the US Courts.

Remember that in the United States you can’t be put in jail for not paying regular debts. But in many states you can be put in jail for things like not appearing in court or following court-ordered payment plans. So if you get an order to appear in court, show up.

Talk to a lawyer if you need legal advice. Here are some tips on how to find legal help when you can’t afford a lawyer..

You can get through this

As I mentioned before, sometimes hard times can change your life for the better in the end. There are many stories of people who got laid off from their jobs who later went on to do something that made them much happier while being better paid. As Dolly Parton says, “Storms make trees take deeper roots.”

As one example, I was unemployed for nearly 4 years after the dot com crash. That experience spurred me to become completely debt free. I never wanted to be in that situation again. Remembering that feeling gave me the strength to change.

Know that something good can come of hard times, even if they are small things. You can use this situation to find out what matters to you, to reach out to people, to take a social media break, or to dream about changes you’d like to make someday.

Others are struggling too. You are not alone, and there are people and resources who can help. Taking one day at a time is plenty. As the quote goes, “One day you will tell your story of how you’ve overcome what you are going through now, and it will become part of someone else’s survival guide.”

You can offer help to others too, even if that help is as simple as sending a text to a friend or neighbor to see how they’re doing, or writing letters to the elderly. We all have something to give, and doing so can make you feel a little better in the process.

Getting through hard times when you have debt written over image man standing in a field of wheat

3 thoughts on “Getting Through Hard Times When You Have Debt

  1. This is a great overview and shows that there is an action we can all take — even if you don’t have debt or trouble paying it, I like the mentions of the volunteer activities we can do. While it’s not recommended to mix money and family/ friendship, with interest rates so low, if you have a well-off connection who trusts you and you trust them, you could arrange a private loan with them for a little bit more than they get from the bank, say 5%, but a lot less than you might have to pay on a credit card. I have known people who have done this successfully to knock off some debt.

  2. Great post. I was let go right as the pandemic began. I was nervous at first, but I started to focus on what I could to make money. My flipping business has been thriving. I’ve had some very good months. Even though I’m looking for work again, I’m still looking to grow the business even more.

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