Should I Pay Down Debt During Uncertain Times? Our Experts Weigh In

With recent economic signs pointing towards a possible recession in the future, you may find yourself questioning if now is really the right time to start pursuing your financial goals of paying down debt. 

To help you answer this question, our experts weigh in on what you should consider during times of uncertainty and offer insight into the steps you can take today for improving your financial well-being tomorrow. 

Do You Have an Emergency Fund in Place?

Before deciding to focus your efforts on paying down debt, it’s essential to review your current financial standing. Ask yourself—do I have an established emergency fund in place? If the answer is no, then your first step should be to create one.

Having an emergency fund can help provide a financial cushion in case the unexpected happens. We recommend saving enough to cover at least 6 months’ worth of expenses. Depending on your financial situation, you may want to start with the goal of saving 3 months of expenses and then work your way up to 6 months. 

Regardless of your end savings goal, the keys are to determine a monthly dollar amount to put away that works within your budget and to stay consistent in your saving methods. By slowly and steadily building your emergency fund, you’ll help set the financial foundation that’s needed to focus on your next goal—paying down debt.

Do You Have a Stable Income?

The next question to ask yourself—do I currently have a stable source of income? While none of us can guarantee what tomorrow will bring, it’s important to recognize whether or not you can reasonably anticipate having the financial resources needed to pursue your financial goals. 

If you feel financially stable and your job outlook seems relatively secure, then contributing extra funds towards paying down debt may be manageable for you. However, if you are in an industry that may feel the impacts of a recession, and/or you’ve recently found yourself unemployed or in-between jobs, it may be best to wait until your income has stabilized before attempting to tackle your debt. 

How is Debt Impacting Your Life?

The final (and maybe most crucial) question to ask yourself—how is my outstanding debt currently impacting my life? Is it making you feel anxious or overwhelmed? Do you find yourself struggling to make all of your monthly payments on time? Do you feel discouraged seeing your balance go up after making payments due to ever-increasing interest charges? 

If you find that your debt is negatively impacting your daily life by creating a constant state of stress and financial insecurity, then it may be time to explore a long-term solution. 

What Are Your Next Steps?

In reviewing our series of questions, are you able to answer yes to the following? 

  • Emergency fund in place
  • Stable source of income
  • Feeling negatively impacted by your debt

If so, then reaching out to ACCS should be your next step! 

At ACCS, we know firsthand the financial and personal challenges that come with having large amounts of debt. We also know that deciding to tackle your debt during times of economic uncertainty can pose a huge dilemma. 

If you currently have $20,000 or more of unsecured debt and are finding it challenging to keep up with your monthly payments, then our debt settlement program may be the relief you need. Our highly-rated program can significantly reduce the amount of debt owed and give you one affordable monthly payment. 

Still have questions regarding debt relief and whether or not you should take steps to enroll? Our debt specialists are here to help answer all your questions and guide you through the process. Request a Custom Debt Relief Plan today to learn more!

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