5 Steps to help you pay off debt and stop struggling!

Minimum payments will not cut it, in order to pay off your debt you need to create a plan of attack to get it paid off along with a lot of discipline.


By Allan R. Kirby


Too much debt


If there is one thing I have learned over the years is that debt can really take a byte into your finances and can leave you struggling to just keep themselves above water. Additionally, once someone gets themselves into debt it can be hard to figure out how to get themselves out of debt and stop struggling with making payments.


I have always taken a hard approach to attack a debt problem, however, this is not for everyone and it involves a lot of and discipline. In some cases, changes to the way you live will be needed to get yourself back on your feet. However, as you reduce spending, organize your finances, and pay down debt you will start to have confidence in your ability to take control of your finances and allow you to stop struggling.


Here are 5 ways to pay off debt:

  • Stop Spending!

  • Build a budget.

  • Pay down debt.

  • Get rid of your high-interest cards.

  • Be disciplined and never give up.

1. Stop Spending!


Yes, It may sound obvious to some of you but you would be surprised at the number of people I have helped over the years who continued to spend even though they are drowning in debt, making minimum payments, and were struggling. Many do not realize that getting control of debt will mean some or a lot of changes to your lifestyle, such as spending less on entertainment, shopping, and going to restaurants. One reason for the surprise is the fact that many assume that just paying down the debt is the only method required to get out of debt, they do not realize it's the spending that got them into debt.

What is the best debt payoff method? Stop spending and paying more than the minimum required payment.

2. Building a budget

Basically, budgeting is a way to manage your household finances by tracking your income and expenditures. It helps you get an idea of your financial situation and provides you a way to plan for things such as vacations, buying a home, and even retirement. The biggest reason for creating a budget is twofold, First, you learn to better manage your spending secondly it helps keep you out of debt.


#1 You learn how to better manage your spending


This is critically important when budgeting, getting control over your spending. When you start learning to budget you begin to take a serious look at your spending habits. This is great news because you will likely end up reducing your spending which will lead to less debt if you're always using a credit card and carrying a balance.


I normally advocate for people who are having financial issues to first figure out how to control spending before moving to pay down debt and build wealth. Without spending control you will never be able to manage your money and properly budget. You could actually save a few hundred a month depending on how much you are spending on, shopping, subscriptions, and entertainment. However, taking your time and keeping a few small luxuries never hurts. If you love buying that cup of Java every morning, go for it, the point is buying in moderation is the key to success.

#2 Keeps you out of debt


What you will find with budgeting is that managing your spending and focusing on what you really need, will by default help keep you out of debt. Having less debt, especially high credit card debt will also keep more cash in your pocket because you're servicing smaller high-interest debt. As we know servicing high-interest debts will eat into your finances and make it difficult for you to manage your money. So if you are starting to learn how to budget but still have a lot of debt, it could be a good idea to cut those high-interest credit cards and consolidate your debt. I have found that most people are less stressed when they are able to get control of their debts.


How can I pay off my debt fast? 1. Pay off your high interest debts first. 2. You need to pay more than the minimum payments, and 3. if possible consolidate your personal debt into a lower interest personal loan.

3. Pay down debt


With spending down and a well-controlled budget, you will be able to start tackling your debt. Getting your debt paid down will help you save money on the interest you could have


  1. You need to ensure that you pay off your high-interest debts first. Generally speaking, this means if you have retail/store credit cards, payday loans, high-interest personal loans, these need to be paid off as soon as possible. The reason why is simple, high-interest loans mean you pay more interest. Getting rid of these types of debt will free more money up to pay down other debts.

  2. You need to make payments that are more than the minimum payments. This is a common mistake that many make. The minimum payment is just that, it's the minimum required to service your debt, it will take you years and cost you a bundle in interest by not paying off debt quickly.

  3. Consolidate your loans into a single lower interest personal loan is a great idea to help you save money and allow you to concentrate your resources on the one loan. This is a great path to getting your personal debt paid off and becoming debt-free.


Are store credit cards worth it? They can be but only if you are able to pay off the outstanding balances immediately and leverage the savings. Store credit cards carry a much higher interest rate, normally 19% or more.

4. Get rid of your high-interest cards


I think your starting to see a pattern in this article about high-interest credit card. However, it can be tough for some to get rid of them. The use of high-interest credit cards along with buying habits is a common reason why people end up in a financial mess in the first place. Although It can be hard for some to let go it's still a good idea to get rid of all of your credit cards and only keep one or two. This is what I did when I made changes to my finances. I cut all of my high-interest retail cards and just kept to one card.


Get a Cash Back Credit Card and make money


Although I only carried a single credit card, I finally relented and got a second no-fee credit card with a monthly cash-back. This has been one of the best financial moves I have done in recent years. I receive on average $45 a month from my cashback card but more importantly, I have religiously put the money into a high-interest savings account and low-cost ETFs. After a few years, I was a little shocked at how much I had accumulated just by using this card. I can now say I made a lot of money simply using a credit card but here is the caveat, I never carry a balance, I always pay it off.


Can you make money using a credit card? Yes, I receive on average about $45 in month from using my cash back credit card. I transfer this money into a high interest savings account and low cost ETF's. But always pay off the credit card and never carry a balance.

#5 Be disciplined and never give up.


It's not easy for many people to make the necessary changes in order to succeed in paying off debt and stop struggling. In fact, it can take months to make the necessary changes to get yourself and your family back on track. Trust me it will take time for some of you to make the changes, but never give up, keep yourself on track, and eventually, your hard work will pay off.


How do you become financially disciplined? Becoming financially dicplined takes a lot of work and patience. However making changes to your lifestyle and keeping disciplined will help you build wealth and plan for retirement.

How to Get Out of Credit Card Debt


By First Stop Spending using your credit card and Secondly Building a budget will allow you to create a path to paying down your debt. But you need to get rid of your high-interest credit cards while keeping yourself disciplined and never giving up. It can be a life-changing event to get yourself disciplined while paying off debt and stop struggling from paycheck to paycheck.


Good Luck!

This is a MySmallBank.com blog written by Allan Kirby, who writes and produces Personal Finance and Money Management articles and videos.


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