There are any number of reasons why you got into debt, including medical expenses, divorce, overspending, or a loss of income. Honestly, though, why you are in debt usually isn't relevant to why you remain in debt. The reasons why people choose to remain in debt also vary, and it is important to identify what is preventing you from taking action.
They Can't Imagine Getting Out of DebtMany people think that being in debt is a perfectly normal part of life. Some grew up in families who always had debt, or they have friends who all have debt. As our economy has become more card-oriented, debit and credit, we don't often see examples of others using cash money to pay for their expenses, and checks are coming near obsolete. It is easy to think that all that card using means that everyone is in credit card debt.
They Think They Don't Make Enough MoneyYes, there are individuals who don't make enough money to take care of their basic living expenses of food, shelter and clothing. Most families, however, are perfectly capable of covering their basic needs, but don't make enough to enjoy all the extras that they see friends and neighbors buying. Once you really start looking at every single expense critically, it is amazing how far people can slash their budget.
They Don't Know HowThe average American has pretty limited financial skills, and money isn't a popular topic. Thankfully, there are hundreds of resources available to almost everyone. I learned about personal finance from reading actual books borrowed from the library; now you can get a library full of resources at your fingertips from blogs and other educational websites. Many communities and companies offer debt counseling for a one-on-one approach. Don't remain dumb about money - get out there and learn what you need to learn.
The Sacrifice Seems Too HardUnless you have a huge jump in income, getting out of debt requires giving up some things temporarily. Many people do not want to make the short-term sacrifice required to stabilize their financial future. It is hard when all your friends want to go out to dinner and it isn't in your budget, and it is no fun to make tough choices.
Part of the "too hard" mindset also comes from the first reason, not being able to imagine what it feels like to be debt free. I see this a lot when it comes to car payments. I firmly believe that we will only ever have a car payment in certain situations where our money is working harder than the cost of the car loan. I know tons of people who just assume that they'll always finance their cars because they can't imagine life without a car payment. At several hundred dollars a month, I can't imagine life WITH car payments!
They Are Afraid That They'll FailIt takes a lot of courage to start anything new, especially anything that might be challenging. For some people, the thought of failing is more difficult than the thought of being in debt forever. It is especially hard when the amount of debt is high, or even unknown.
Regardless of why you are still in debt, please know that it is a battle that you can win. It might take time, and there will probably be some rough moments. But the freedom of being in control of your finances is absolutely worth the challenging time it takes to get there!
P.S. There is another reason, but it is a lot harder to overcome and I don't want to make light of it. If your spouse or significant other is not on board, you have a lot harder job. It is almost impossible for a couple to fix their financial issues by the efforts of just one partner.
Sometimes, just finding common long-term goals can pull a couple together financially. Other times, outside intervention, such as counseling, may be required. In the rare odd situation, there is no way to find a common ground and the couple will have to either separate their finances or accept that they'll never attain the things that they could attain if they worked together.
My heart goes out to anyone in this last situation. I have seen it frequently, and it causes a lot of pain and frustration for everyone involved. Good luck!