If you’re working on getting out of debt, don’t take advice from the wrong people. Who exactly are the wrong people? People who haven’t been there, and successfully done that.
You see, debt isn’t logical.
Pick your price
If you wanted to buy something and someone said to you, “You can either pay $20,000 for it or $22,300.20, which would you prefer?” of course you’d take the $20K price. Right?
Wrong. If you’re in debt, you’d take the higher price, because it’s “only” 60 affordable monthly payments of $371.67. (If you’re wondering where I got those numbers, they’re based on this calculator for a car loan that would be repaid over 5 years at a rate of 4.37%.)
People who have never been in debt see things differently
But people who have never been in debt would tell you that it makes sense to pay the extra $2300.20 because you can make more than 4.37% elsewhere on that $20K (and they’d have that $20K out there earning money). Or they’d tell you that they’d never borrow money because it makes no sense to pay extra for everything.
In both cases, they’re being logical. They’re also making assumptions about you that aren’t true. By definition, if you’re in debt — especially if you owe many thousands of dollars — you’re not doing the logical thing.
How you got in debt
If you’re in debt, you didn’t get there by being logical. You got there by being emotional, and/or by not planning ahead enough. You’re not going to get out of debt by being logical either.
So don’t listen to these people with all the sensible suggestions to consolidate debt or to do balance transfers in order to reduce your interest rates.
Interest rates are not your real problem. Your behavior and emotions are. And having a lower rate isn’t going to change what you do or how you feel.
Change those things first — long term — and then you’ll be able to look at things logically.
I'm Jackie Beck, personal finance writer and creator of 
I am not taking wrong advice from anyone. I have you, Team 3, Yakezie and my step father. :)
Go Jai! :)
Great post! I had almost $20k in debt about 4 years ago and wasn’t sure how I was going to pay it off. I felt like I was making good payments, but it didn’t get me anywhere. Advice didn’t help me, I had to realize that I needed to change how I looked at my finances and change my habits if I was ever going to get out of debt. Once I made the change I paid off the debt in just over a year. Now my only debt is a car (interest rate is too low to pay off early) and my mortgage.
Isn’t it funny how what a turnaround changing your habits can lead to?
I think this goes for weight loss too. Taking advice from people who don’t struggle with food isn’t particularly helpful because they don’t have the emotional ties that you do to food. And if you’re taking advice from someone who hasn’t successfully dealt with their weight, well, then again, you’re taking advice from the wrong person. Good post!
I think you’re right; that makes perfect sense.
I’d add taking parenting advice from people who aren’t parents – please don’t tell me how to get my baby to sleep through the night if you’ve never been awakened at 2am by a teething infant.
Boy I’m glad those teething infant days are long behind me ;)
I reiterate Jai, we have good advisers in yakezie. I am also not taking any advise.
Yeah there are a lot of smart cookies in the Yakezie.
I am person who has been through the tortures of debt. It felt as if I were in a black hole. No reason or logic works there. Nothing stays in your hand. Every next months brings some thing that is an emergency. Building an emergency fund becomes mission impossible. Jackie! you are damn right. One should consult only that person who has been there and who has come out successfully or at least is in the right path to a debt free life.
Sounds like you made it through to the other side though!