Top 5 Tough Conversations that Could Help You Put Debt Behind You

If you want to get rid of your debt faster or if you’re struggling to pay your bills, you’re not alone. Many Americans find themselves needing debt relief to get out from under credit card bills or other personal debts. 

Putting your debt behind you isn’t just about how much cash you have to throw its way. You might also need to have some hard conversations with the people in your life. 

Many of us struggle to ask for help with money management or debt. But ignoring or hiding the problem could make it grow. Talking is the first step toward solving them.

Let’s look at some of the difficult (but helpful) conversations you might need to have. 

1. Talk with Your Creditors to Negotiate Debts

If you’re having trouble paying your debts, start by talking with your creditors. Call your credit card company, bank, or other lenders and give them advance notice (if possible) that you’re having financial difficulties. Many banks and credit card companies have loan forbearance and financial hardship programs. If you qualify, you might be able to negotiate a payoff plan that works for you. 

Or, if you are already falling behind on your bills and you know you can’t afford to fully repay your debts, you might want to consider debt settlement. This is another kind of debt negotiation. You ask your creditors to accept less than you owe and forgive the rest. 

For example, if you owe $10,000 on an overdue credit card, you might ask the creditor to accept $5,000 instead. 

Not every creditor will agree to debt settlement. If they do, the forgiven debt is likely to be reported to the IRS and you might have to pay income taxes on it. In the example mentioned above, if you received $5,000 of debt forgiveness by settling a debt with a creditor and you’re in the 12% federal income tax bracket, you’d owe about $600 of extra taxes for the year. 

If you’re insolvent when you settle the debt, meaning what you owe is worth more than what you own, then you won’t have to pay income taxes on the forgiven amounts.

Here is a sample script for talking to creditors about debt settlement: 

“Unfortunately, I am falling behind on my bills. I’d like to make a debt settlement offer. Would you be willing to accept ______ (percentage) of what I owe on this account?” 

Expect your creditor to start by saying no. They want to get paid. Negotiating could take a few rounds of phone calls.

You can negotiate debt settlement by yourself. But if you don’t want to, you can work with a professional debt settlement company like Freedom Debt Relief. A reputable debt settlement company can help you understand your budget, make a plan to save up money to offer your creditors, and talk to creditors on your behalf. This might help you make a debt settlement offer that creditors accept. 

2. Ask Your Family for Help 

If you're struggling to repay your debts, you might need to have some difficult, honest conversations with your loved ones.

Here is a sample script for a conversation with your loved ones about getting out of debt: 

“Our family needs to change the way we spend money. We need to cut back on some things for a while until we get out of debt. Let’s sit down together and look at our monthly spending and see what we can cut from our budget. Let’s plan meals and cook at home more often. With everyone’s ideas and support, we can get through this together.”  

3. Ask Your Boss for a Raise

Cutting expenses is not the only way to get out of debt. You could also try to boost your income. If your job is secure and your employer is doing well, you might want to ask your boss for a raise. Or ask how you can get more responsibility at work, move up in your career, and earn more money in the long run. 

Here is a sample script: 

“You know how much I love working here, and I love our team. I want to ask for advice about my career and compensation. What can I do to be more valuable to this company and to qualify for a pay raise? How soon do you think I could expect to see a raise or promotion?” 

Many people struggle to find the confidence to ask for more money from their employers, but this tough conversation could be your ticket to more income.

4. Talk to a Credit Counseling Agency 

If your debt is higher than you want it to be but you make a good income, you might want to talk to a consumer credit counseling agency. These credit counselors can help you with a debt management plan (DMP). A DMP is a structured, managed debt repayment plan. It’s for someone who wants to fully pay off their debts but needs professional guidance and support along the way. 

Your creditors might agree to lower your interest rate while you’re in the plan. That could help you make more progress against your debts each month. You’ll probably have to agree not to use credit cards while you’re in the plan.

5. Meet with a Bankruptcy Attorney 

If you need legal protection from creditors, you might want to consider bankruptcy. Talking with a bankruptcy attorney is another difficult conversation that could help you deal with your debt. Reputable attorneys typically offer a free consultation so you can understand if bankruptcy is a good fit for your situation. 

If you qualify for Chapter 7 bankruptcy, your unsecured debts (like credit cards and medical bills) could be wiped out within a few months. If you can afford a payment, you won’t qualify for Chapter 7. In that case, you could file Chapter 13, which is a structured repayment plan managed by the court.

Sometimes the best way to get debt-free fast is to have difficult but helpful conversations. Facing your debt problems head on, understanding your options, and asking for help could put you on a path to the other side of debt.