Five Signs You Have Debt Problems & How to Solve Them

Many people grapple with debt, ranging from mortgages and auto loans to credit card balances and personal loans. While borrowing is a common part of modern life, it becomes a problem when it spirals out of control, and we end up drowning in a sea of debt. But how do we know when we’ve crossed the line? Here are the five signs you have debt problems and steps to solve them.

The Inability to Make More Than the Minimum Payments

If you find yourself only able to make the bare minimum payments on your credit cards or loans, this could be a red flag.

Creditors might be satisfied with receiving the minimum payment, but this approach could land you in a pit of high-interest charges. Moreover, it prolongs the period you’ll be in debt, which can adversely impact your financial health.

Relying on Borrowing or Balance Transfers

Have you found yourself borrowing money or transferring balances from one account to another just to stay afloat? This is another sign that your debt might be getting out of hand.

Balance Transfer

While balance transfers can sometimes be a smart move to reduce interest rates, it becomes a problem if it’s your only strategy to make minimum payments on your debts.

No Emergency Fund

An emergency fund is a financial safety net designed to cover unexpected expenses or financial emergencies. If you have no savings set aside for emergencies, you are living on the edge.


“You never know what life is going to throw at you. From the unexpected like the current COVID-19 pandemic to less extreme situations like a major car repair or a family illness, it’s crucial to have an emergency fund.” – Financial Expert


The absence of an emergency fund could force you to resort to borrowing in the event of an unexpected expense, pushing you further into debt.

Maxed Out Credit Cards

Are your credit cards maxed out or nearly maxed out? This is yet another sign that you could be struggling with debt.

A good rule of thumb is to utilize 30% or less of your available credit. So, if your credit card has a limit of $10,000 and you’re using $9,000 of it, you’re potentially harming your credit score and piling on more debt.

Frequent Calls from Creditors or Collection Agencies

If you’ve been receiving persistent calls or letters from creditors or collection agencies, this could be an indicator that you’re in over your head with debt. Missed payments and late payments not only damage your credit score but could also lead to legal actions if the collection agency decides to take the matter to court.

How to Solve Debt Problems

Acknowledging that you have a debt problem is the first step towards solving it. Here are some strategies to get out of debt:

Understand Your Debt Situation

The first step in solving your debt problems is understanding the extent of your situation. Start by making a comprehensive list of all your debts, including who you owe and the interest rate on each debt. This will help you create a strategy for reducing your debt.

Revise Your Budget

Another effective way to address debt problems is to revise your budget. Look for areas where you can cut down on expenses, like dining out or digital subscriptions, and use this saved money to pay off debts.

Reach Out to a Debt Professional

If you’re struggling with debt and have tried the strategies above without success, it might be time to seek professional help. A licensed insolvency trustee can provide valuable advice and help you navigate your way out of debt.

Just give us a call today for a free consultation. We are here to listen and help you.

In conclusion, recognizing the signs of debt problems is the first step towards financial freedom. With the right strategies and professional help, you can navigate your way out of debt and regain control of your financial future.

Find Your Personal Debt Relief Solution

Licensed Insolvency Trustees are here to help. Get a free assessment of your options.

Discuss options to get out of debt with a trained & licensed debt relief professional.