Conquer Debt Once and for All

Conquer Debt Once and for All

How to Get Out of Debt Once and For All

So, since you found this article, I assume you’re wondering how to pay off debt. You’re sick and tired of struggling with your finances and feeling stuck! You need to get out of debt once and for all.

But do you actually, really want to get out of debt? More than you want a new car or a bigger house or gourmet coffee or anything else in the world? Because that’s what it will take. Just like losing weight or conquering an addiction, it can be really hard.

But you’re not quite sure how to get out of debt.

Get out of debt; eliminate debtIf you truly want it badly enough, though, this is the post that will help you do it.

Not someday. Not next week. Right — freaking — now.

There is no secret to getting out of debt — no magic words or miracle drug. You must spend less than you earn. You can decrease your spending or increase your earning, or a combination of them both, but it really is that simple. It’s not easy, but it is simple. And it’s SO worth it! Debt is bondage, and not having debt is peace.

If you’re still in, let’s get busy!

(This post may contain affiliate links. Please read my disclosures for more information.)
First things first!

How to Get Out of Debt Fast:

1. Stop accumulating debt.

Just stop right now! Easier said than done, I know. But take drastic measures, because this is the only way to get your finances back on track. Cut up your credit cards or mail them to your grandma with instructions to hide them from you. Or you could freeze them in a gigantic block of ice.

Would you be able to stop smoking if you kept a pack in your pocket at all times?

how to get out of debtGetting out of debt starts with eliminating the reasons you went into debt in the first place. Be explicitly honest with yourself and determine why you are in debt.

It’s very obvious when you have something like a gambling problem, or you took out enormous student loans. It might be less obvious if the debts were added to a little at a time — a pair of expensive shoes here and a gourmet coffee there.

But you can still figure out where your biggest problems are by going through your credit card receipts. You should be able to access at least a year’s worth of statements online.

Do you have a group of spendthrift friends who shop for fun? You might need to find different friends.

Were you embarrassed about your car? You need to work on your self-worth.

Did you see the debt as a means to an end? For example, perhaps you thought a degree would allow you to earn more, so you justified hefty student loans.

Whatever your reasons for accruing debt, you need to pin them down and do some soul-searching so you can eliminate that mindset and those habits, or you will just end up back where you started.

2. Tally up and record your debts.

how to get out of debtYou may be afraid of how much debt you have, but ignoring the problem will not make it go away. Rather, it will make everything worse.

So gather up your bills and log into your bank accounts. Student loans, credit cards, auto loans, everything but the mortgage. We’ll talk about mortgages later. Be brave and explicity honest with yourself!

Debt is like any addiction. If you were an alcoholic trying to break that addiction, you would not be doing yourself any favors to stash a bottle of liquor in your favorite hiding place. Let’s get it all out in the open.

What’s your number?

Record it somewhere because you’ll want to refer back to it often. In fact, use a notebook and record your debts with today’s date.

This way, you’ll be able to keep track of your goals and plans, and you’ll especially want to keep track of how much debt you’ve paid off.

3. Rank your debts in order of the total balance.

Next, you should rank your debts in the order you want to pay them off. Some experts recommend going from the smallest amount to the largest since this helps get the momentum going.

Others recommend listing the debts from the highest to the lowest interest rate since this will save you the most money in interest overall. You know yourself best, so you go ahead and determine the order that makes the most sense to you.

Lately, I’ve seen a trend toward publishing debt lists and payoffs publicy, and I think it’s a great idea. Friends can help us to be more accountable to our goals, and they can also provide helpful feedback.

4. Create a debt payoff plan.

Okay. So now you’re not buying, because your credit cards are MIA, right? Great! But you still have to pay for all that you stuff you bought last week and last month and last year.

You might even still be paying for stuff you bought years ago that you no longer even have. Isn’t that depressing? If you could go back in time, what would you tell yourself about those purchases? Write that advice down in your notebook because you’re going to need to talk yourself out of future unwise purchases.

Remember that you need to earn enough money to survive plus enough money to pay down your debts, which is drastically more than just making the minimum payments you’re presently making.

You might think that is unrealistic — the money you make is insufficient for your lifestyle, which is why you are in debt. To that I say, lifestyle-schmifestyle. I know it’s hard to go backward, from steaks to ramen noodles, but that’s what this is all about.

We’re making hard choices and forgoing the worthless trinkets (or fancy coffee or designer handbags) we want right now for what we ultimately want, which is to be debt-free.

The faster you want to become debt-free, the more you have to earn above and beyond what you spend. In simpler terms, you should both spend less and earn more.

5. Spend less and earn more to find extra money to pay down your debts.

Next, you need to decide how much extra money you have each month to pay towards your debt. You will be able to pay off your debt more quickly if you both learn to live more frugally (spend less) and increase your income.

‘Spend less’ is the first half of your new mantra.

First, you’ll need to create a budget. Reduce each category to as little as you can possibly get away with. Look for ways to reduce your utility bills (bye, bye Cable TV!) and your grocery budget (bye, bye ribeye!) and your clothing budget (hello, hand-me downs!). Even winning the lottery won’t solve your problem if you never learn how to spend less than you make.

Related Reading: 7 Secrets for Saving Money on Groceries

Related Reading: 37 Frugal Tips From an Extreme Cheapskate

The second half of your new mantra is ‘make more’. Start by selling all your extra junk, which will also bring you peace of mind. Eventually, you’ll run out of stuff to sell, though, so you need a long-term plan.

There are multiple great options for part-time, second jobs: food service, babysitting, mall stores, delivery routes, security guarding, tutoring, teaching prep classes, bartending, cab driving, etc.

Working that many hours can really suck the life out of you, but remember that you aren’t signing on for life. Once your debts are paid off, your money will be yours again, and you can reevaluate whether or not you want to keep your second job.

Ultimately, you should learn how to work smarter, (passive income, baby!) so that you don’t have to work more, because you don’t want to have to work two jobs forever! You can do anything for awhile, and this will be hard, but it’s all so tomorrow can be better than today.

Oh, and it should be a no-brainer, but I’m still going to write it here in black and white:  earmark gifts, bonuses, and other “found” money to your debt payments. You will be tempted to do otherwise, but that’s why you’re in debt. Be smart now so you can live better later.

Spend less, make more! Write that on sticky notes and post them everywhere. Here are a few ideas to get you started:

Spend Less

Cut your grocery bill in half

15 Meals you can make for pennies

Stop wasting money

7 Thrifty Habits of the Super Rich

5 Frugal Habits of Billionaires

Earn More

Sell Stuff- Declutter and pay off debt at the same time. Both will bring you immense peace.

Work More- Find a 2nd job. Think pizza delivery, uber driver, babysitting and mowing lawns.

Work smarter- Earn a promotion, find a higher-paying job, start a business.



6. Focus on one debt at a time.

In order to succeed with your debt repayment plan, you should focus on paying off the first debt on your list. Put all extra money toward this first debt, while just paying the minimum on all other payments.

When you focus on one debt at a time, you can pay off the debt much quicker, because more of the money will go directly to the principal balance and less is spent on paying interest. When you spread your extra money over several debts, you are lessening the impact it has on your debt because you are paying more interest.

Once you’ve paid off the first debt on your list, it’s time to move onto the next debt, while paying the remaining debts’ minimum balances.

Continue to do this until you have crossed all your debts off your list. And keep in mind that when you first start working on your plan, it may seem like it will take forever to pay off your first debt, but as you work down your list and gain momentum, you’ll be surprised at how quickly you can pay off the next one.

These debt repayment strategies are know as the debt snowball and the debt avalanche, explained more below.

7. Monitor and adjust your debt repayment strategy.

Don’t get too comfortable just yet. You’ll need to track your behavior closely to make sure you’re making progress, and you’ll want to make adjustments when necessary.

I know that when I feel terribly stuck at something I’m working on, I tend to want to ignore it. If that starts happening, you’ll want to adjust your strategy to make it more palatable.

Monitor your credit score to make sure it’s improving over time. As your credit score improves, consider balance transfers or a debt-consolidation loan to decrease interest charges for your remaining debts.


8. Set aside an emergency fund.

This is not a joke. You might be wondering how it’s possible when you’re already living paycheck to paycheck and only making minimum payments. But it is imperative that you set aside some funds for emergencies.

how to get out of debt


Emergencies are inevitable! If anything comes up, like a job loss, medical bill, or car repair and you don’t have an emergency fund, you will be forced to resort to further debt. Who wants to end up right back where you started! You’ve worked so hard!

Once you get your debt snowball going and wipe out a couple of debts, you’ll be able to divert a few of those dollars to your emergency fund. Trust the process — you really will!

Some experts suggest $1000. I think that amount is fine for young, non-homeowners. And it’s a great beginning amount for everyone. But that amount will barely cover a new refrigerator or water heater, and emergencies tend NOT to happen singly. So I like to have a much larger emergency fund. Be sure to record your emergency fund goal in your notebook. It’s only a dream until you write it down, and then it becomes a goal.

Ultimately, you should have at least three months of expenses set aside, in case of job loss or an accident. Don’t let it stress you out, but do make it a goal. It will never happen otherwise, and it is really necessary. You’ll get there!


Helpful tools for paying off debt:

You’ll need these tools to help you .

Debt consolidation loans

You’ve probably received offers in the mail that promise to consolidate all your credit card debt into one low-interest bill—either through a debt consolidation loan or credit card balance transfers. Are they a good idea?

Only when they make sense financially. Debt consolidation loans don’t make sense if the loan will cost you more over the long haul compared to paying your cards down faster. Use a debt calculator and input both scenarios, paying off your debts without debt consolidation and then with debt consolidation, to see which makes better sense for your particular situation.

Beware that sometimes debt consolidation actually encourages further debt by tricking your mind into feeling less indebted, just because you’re now receiving only one bill, where previously you would receive multiple bills for the same debt. Be smart! Don’t let that happen!


Balance transfers

With credit card balance transfer offers, you generally pay a fee for transferring your debt to another card with a lower APR (e.g., 0% promotional APRs). Make sure you pay all the debt off before the promotional period is over. In both cases, do the math to make sure it’s worth it.  You can sometimes negotiate credit card balance transfer fees. It’s worth a try!

Refinance your student loans

The average person carries $27,000 in student loan debt, which is a tremendous burden. The good news is you can refinance your student loans and possibly save thousands. You might even be able to get your student loans forgiven or paid for by your employer and eliminate that debt entirely. It won’t hurt to look around and see! If you need help managing your loans, can help you find the most effective plan to tackle your student loan to find the option that makes the most sense for you.

Credit counseling

American Debt Enders offers Free Credit Counseling Advice for anyone oppressed by debt. They provide one-stop debt relief solutions that will cost you less than debt settlement. They have attorneys on retainer in your home state to help negotiate debt settlement and recover money from debt collectors for abuse. They also have a full credit restoration program in which negative remarks are removed from their clients’ credit reports.

If You Have A Debt Problem, You need to know all your options.
American Debt Enders can get you on the road to Debt Freedom. America’s Debt Relief One Stop.

Negotiate credit card interest rates and settle debts

A lower interest rate will help you pay off your credit card balances faster. It’s worth asking, will cost you nothing if they say no, and save you tons if they allow it! You could save hundreds or thousands of dollars, depending on your credit card balance! If you’ve got medical bills—one of the biggest sources of financial distress and common causes of debt—you might be able to get financial aid from the hospital or negotiate that medical bill. You might be able to settle other debts if you can’t pay them back completely.

Use the debt snowball method

With the snowball method of paying off debt, you apply the majority of your available money for debt repayment to one loan, while making minimum payments on the others. Then when the first loan is paid off, you tackle the next loan and so on until all you’re out of debt completely.

Financially speaking, it’s smartest to pay down the accounts that carry the highest interest rates first. That way, you’re staving off as much interest as possible and don’t end up owing even more.

But because people are emotional as well as logical, what makes sense mathematically on paper doesn’t always work best in real life. Paying down debt is as much about motivation as it is about money, and some people find more success by prioritizing accounts with smaller balances, rather than those with higher interest rates, according to research from the University of Michigan. Paying smaller debts off more quickly can help those people to stay motivated to keep working.

Financial experts argue over the method of paying down debt that works best. Some claim that it makes sense to pay on the debt with the highest interest rate first. After all, that does save you the most money.

Others argue that it’s more important to pay your debts in a way that keeps you motivated to keep going until you’ve wiped them all out. Paying off smaller debts first will motivate you to keep going. If you begin with the biggest one, you might think you’re not making fast enough progress, lose steam, and not finish the job.

Just know that both ways have success, and whichever you choose, you’re taking a step in the right direction.


how to get out of debt



Are you ready to get out of debt? Then take action! Right now! The hardest part of any journey is the first step.

Before you close this page, take that first step.

  • Cut up a credit card
  • Write your new mantra, ‘Spend less, make more’ on sticky notes and post them where you’ll see them often
  • Complete step one above
  • Post something you own for sale
  • Make a list of financial goals
  • Submit an application to a new (higher paying or additional) job
  • Transfer a high-interest rate balance
  • Create a budget
  • Call American Debt Enders for free credit counseling advice, help and solutions.


Once you are out of debt — don’t go back! If you know you are debt-prone — that debt is a weakness or addiction for you — get rid of your credit cards completely and switch to a cash-only system to stay debt-free.



Pin this ‘How to Get Out of Debt’ guide for future reference!


Do you have any suggestions for how to get out of debt? Please leave them in the comments below!




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12 thoughts on “Conquer Debt Once and for All”

  • With three kids, education and our own expensive lifestyle, we were racking up debts and headed for a big trouble. Fortunately, we wisened up at the right time and mended our ways. I agree with your tips 100%. Great post.

  • Debt has always been the result when there is a lack of money and a situation when spending money is a must. It can solve problems at the moment but create a lot in the future. But it also gives more time to prepare to solve the problems in the future like paying on the installment basis. This way the burden of paying large sum of money is lessen. If possible, all options, all alternatives should be considered first and only resort to debt when out of options. This way further problem can be avoided. Learning also to prioritize and having self-discipline can help avoiding debt. Also learning to make debt work on your favor is the best idea like acquiring a real state through debt then having it rented to some clients and pays the monthly amortization with the monthly rent from that real state.

  • Great thorough list of tips! I especially the one about understanding why you have debt. It’s important to note that we spend money for deeper reasons than to just accumulate things.

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