Retire your debts before you worry about retirement.

This was the most shocking headline in TIME magazine last week: “Half of Workers Are on Track to Retire Well – Here’s How to Join Them.”

The story began like this: “Save 15 percent of pay for 30 years and you will be fine.”

Really? That’s like saying, “Don’t ever eat dessert and your waistline will be fine.”

The facts are plain: Americans have $870 billion in credit card debt and $1.2 trillion in student loan debt. Saving 15 percent of their income for 30 years isn’t an option for many of them.

Here’s what is.

1. Get out of debt first – and fast

Imagine you have a dollar bill you found between the sofa cushions. You want to use it for something more than a soda. Should you save it for retirement or put it toward your credit card bill? In other words, should you pay off debt or save first?

According to Bankrate, last week’s average interest rate on all credit cards (fixed and variable) was more than 14 percent. It’s a rare investor who will earn that much with their IRA or 401(k) investments.

If you have credit card debt, your first priority must be paying that off. Whether you do it on your own or use a free debt analysis from, you can’t save for the future if you’re worried about the present.

2. Reassess your relationship with money

I’ve been counseling Americans about their money for more than two decades. Believe it or not, helping a family climb out of $20,000 of credit card debt is easier than keeping them from doing it again.

However, each of those family members will face a lifelong temptation to go into debt again — and not because they’re weak or don’t care.

The problem isn’t about them, really. As I explained in my book, Power Up…

Every day, mailboxes around the country are filled with zero-percent financing offers and other such promises from credit card marketers. Just fill in the blanks and they’ll do the rest. It’s a message that plays right into the American psyche. We want things, and we want them now.

That’s one reason I’ve filled with so many calculators and self-help booklets and debt solutions. I want Americans to have the tools to fight back against marketing.

3. Save for retirement with found money

Once you understand where your money is going and how to spend it wiser, you can pay off your debts quickly. When you’ve finally achieved financial freedom, you don’t suddenly spend all that extra money that previously went to pay down those debts. You simply set aside that amount for your retirement.

If you’ve been thinking of getting serious about your debts but keep thinking, “I’ll do it next weekend,” you now understand the urgency. It’s not just about paying off those debts. It’s really about saving for retirement.

Howard Dvorkin is a CPA and chairman of, an educational resource for those who want to conquer all forms of debt in their lives.

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About the Author

Howard Dvorkin, CPA

Howard Dvorkin, CPA

I’m a certified public accountant who has authored two books on getting out of debt, Credit Hell and Power Up, and I am one of the personal finance experts for I have focused my professional endeavors in the consumer finance, technology, media and real estate industries creating not only, but also Financial Apps and Start Fresh Today, among others. My personal finance advice has been included in countless articles, and has appeared in the New York Times, the Washington Post, Forbes and Entrepreneur as well as virtually every national and local newspaper in the country. Everyone should have a reason for living that’s bigger than themselves, and besides my family, mine is this: Teaching Americans how to live happily within their means. To me, money is not the root of all evil. Poor money management is. Money cannot buy happiness, but going into debt always buys misery. That’s why I launched I’m glad you’re here.

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