If you're trying to dig out of a bad spot, you want a shovel, not a spoon.
But when it comes to digging out of debt, lots of people grab the equivalent of a spoon.
For example, one dumb way to destroy debt is making minimum payments.
If you're paying off a a high interest card, paying the minimum can stretch the debt over decades and tack on thousands in interest.
Another bad idea? Taking money out of a retirement plan: not only do you handicap your retirement, you could pay thousands in fees and taxes.
Then there's paying off one debt with another. Worst case? Payday loans. But even low interest, potentially deductible loans like home equity mean risking the roof over your head.
Then there's using a debt settlement company to pay a fraction of what you owe: Can it work? Maybe,but some of the techniques these companies use can bury your credit score, and many charge high fees.
Those are the spoons when it comes to digging out of debt. So what's the shovel?
It's finding extra money, focusing on your smallest debt, paying it off, then adding that old payment, along with extra money, to the next debt down the list. It's a technique called pyramiding, or snowballing.
Where do you find extra money? Lots of ways. Track your expenses and see if you can squeeze it out of your budget. Sell stuff at a yard sale. Get a part-time job. In short, however you can.
I know: easier said than done. But it's better than trying to dig out of debt with a spoon. What you need now is more information and inspiration. Both are waiting for you.
Just go to MoneyTalksNews.com and do a search for "Debt."
For Money Talks News, I'm Stacy Johnson.