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‘The stress is killing me’: I’m 73 and crumbling under $200,000 in debt — and I have no savings. Can anyone help me?

“I get about $4,000 a month in Social Security benefits.” (Photo subject is a model.)

“I get about $4,000 a month in Social Security benefits.” (Photo subject is a model.) – Getty Images

Dear MarketWatch,

I’m 73 years old and, through a combination of easy credit and bad financial decisions, I not only have zero savings, but I also am close to $200,000 in debt. I get about $4,000 a month in Social Security benefits. I’m current with all my bills but barely make minimum payments. The stress is killing me.

Any ideas on what I should do?

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In Debt and Stressed

Related: I’m 67 with $25,000 saved for retirement, but I just got a big pay raise. Should I claim Social Security now while I’m still working?

Dear In Debt,

I’m very sorry to hear about your circumstances and the stress they are causing you.

It may not seem like it, but the fact that you have homed in on what exactly your problem is — the easy credit, for example — is what will help you get on the right track. Sometimes people get so caught up in the problem itself that they may not realize how they got there. By being aware of your past behavior, you can start to fix this.

The first step, of course, is to increase your income. You mentioned that you’re getting Social Security, so I am assuming you are retired. Is it possible for you to go back to work, even part time? If you were to take on work again, you could theoretically keep your current living expenses the same — or, ideally, lower them — and use that extra income to pay off your debt.

Getting a job in retirement isn’t always simple, of course. Depending on how long you’ve been out of the workforce, you will need to take time to update your resume. If you’re years removed from your work history, you could try to build more skills that will make you an attractive potential hire.

There are so many ways to build or improve a skill set that require no money. One option is the internet — search for videos or blogs that speak to your craft, and absorb as much information as you can. The library is another option — you can take books out, or possibly attend a class that would benefit you, such as learning a new computer program.

And you don’t have to look for a job in your former field. You could, for instance, consider working in retail. That industry typically has more options for flexible schedules, and may even offer workplace benefits that might interest you, such as a retirement plan.

Examine your bills

The next step is to get very familiar with your finances. You said you’re current with your bills, which is good, but you need to go far beyond that. Look over your last few months’ worth of credit-card statements and see what exactly you’re spending on. Is there anything you could cut?

If you pay for cable TV or another service with a negotiable price, can you find a cheaper alternative? You obviously don’t want to get to the point where you’re hurting yourself by not paying for groceries or medications in order to save money, but if there is extra money going toward purchases that do not serve you, tackle it now.

Is your debt consolidated, or are you paying different lenders? Are you paying off the minimum amounts due every month? What are the interest rates, and is there an option to lower those rates? There are a few different debt-management strategies, including paying the balance with the lowest rate first to eliminate it altogether, or aiming for the balance with the highest rate.

Another option — but one that must be pursued with caution — is to move some debt to a zero-interest card so that you can pay it off more quickly. With this, strategy, however, you have to be extremely careful, as the zero-interest rate is temporary and reverts to a much higher one when the introductory period ends. If you have any balance left over at that point, you could end up paying more than you already are.

Consider local debt-counseling services, which may be free, but always check the terms for free services. In New York City, there are Financial Empowerment Centers that offer free one-on-one counseling. The National Foundation for Credit Counseling may also be able to offer resources to help you manage your debt.

If you can, try to put together a few months’ worth of living expenses to help keep you from taking on more debt. What if your car needs repairing or if one of your home appliances gives out? That’s why even a part-time job could help.

It’s a long, hard road, and the progress may seem slow at first, but it will be worth it in the end.

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