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6 Tips for Paying Off Debt

Written by Jimmy Rustling

Debt can feel like a weight that’s always dragging you down. Whether it’s credit card balances, medical bills, or student loans, the stress of owing money can seem never-ending. But the good news? Paying off debt isn’t impossible – it just requires a plan and the right mindset.

Here are six practical tips to help you take control of your finances and eliminate debt faster.

  • Get Clear on What You Owe

The first step in tackling your debt is understanding the full picture. Make a list of all your debts, including balances, interest rates, and minimum payments. This gives you a clear starting point and helps you prioritize which debts to pay off first.

High-interest debts, like credit cards, typically cost you the most over time. Consider using the avalanche method to pay off the debt with the highest interest rate first while making minimum payments on others. Alternatively, the snowball method – starting with the smallest debt – can provide a psychological boost as you knock out balances one by one.

  • Create a Budget and Stick to It

If you want to pay off debt, you need to know where your money is going. A budget helps you track your income and expenses, so you can identify areas to cut back and allocate more toward debt repayment.

Start by categorizing your expenses into needs (housing, groceries, utilities) and wants (dining out, streaming services, nonessential shopping). While cutting back on “wants” might feel like a sacrifice, remember that it’s temporary and for a good cause—your financial freedom.

Use budgeting tools or apps like Mint or YNAB (You Need a Budget) to stay organized and accountable.

  • Understand Your Rights as a Consumer

Dealing with debt collectors can be one of the most stressful parts of being in debt. But knowing your rights under the Fair Debt Collection Practices Act (FDCPA) can protect you from unfair treatment and harassment.

Under the FDCPA, debt collectors are prohibited from:

  • Calling you at odd hours (before 8 a.m. or after 9 p.m.)
  • Threatening you with jail time or other illegal actions
  • Misrepresenting the amount you owe
  • Contacting you repeatedly to annoy or harass you

Understanding what collectors can and can’t do empowers you to stand up for yourself. If a collector crosses the line, report them to the Consumer Financial Protection Bureau (CFPB) or your state attorney general’s office.

Knowing your rights not only reduces stress but also ensures you’re not pressured into making decisions that could harm your finances.

  • Earn Extra Income to Pay Down Debt Faster

Sometimes, cutting back on spending isn’t enough to make a significant dent in your debt. That’s when earning extra income can make all the difference.

Consider side hustles or freelance work that fit into your schedule. Whether it’s driving for a rideshare service, selling handmade goods online, or picking up a part-time job, the additional income can go toward your debt.

If taking on extra work isn’t feasible, look for ways to monetize your existing skills or possessions. For example, tutoring, renting out unused space, or selling items you no longer need can bring in extra cash to accelerate your debt payoff.

  • Negotiate With Creditors

Don’t assume your debts are set in stone. Creditors may be willing to work with you, especially if you’re struggling to keep up with payments.

Reach out to your lenders to ask about:

  • Lowering your interest rate
  • Settling the debt for less than the full amount
  • Setting up a payment plan that fits your budget

Be honest about your financial situation, and don’t be afraid to advocate for yourself. In some cases, lenders prefer to negotiate rather than risk you defaulting entirely.

If you’re unsure how to negotiate effectively, consider working with a nonprofit credit counseling agency. They can help you develop a debt management plan and negotiate on your behalf.

  • Stay Motivated With Milestones and Rewards

Paying off debt can be a long and challenging journey, so it’s important to stay motivated. You can do this by setting small milestones along the way and celebrating when you hit them.

For example, reward yourself when you pay off your first $1,000 or when you clear your smallest debt. Rewards don’t have to cost much – think of something meaningful but affordable, like a nice meal at home, a movie night, or a day off to relax.

Visual reminders of your progress, like a debt payoff tracker or chart, can also keep you focused and motivated. Watching your balances shrink is incredibly satisfying and reinforces your commitment to the goal.

Adding it All Up

Debt can be one of the biggest sources of financial stress in your life. And while it might feel insurmountable, there’s almost always a reasonable path forward. The key is to understand your situation, know your rights, and be disciplined enough to follow a plan. 

Hopefully, this article has given you some ideas on how to move forward!

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About the author

Jimmy Rustling

Born at an early age, Jimmy Rustling has found solace and comfort knowing that his humble actions have made this multiverse a better place for every man, woman and child ever known to exist. Dr. Jimmy Rustling has won many awards for excellence in writing including fourteen Peabody awards and a handful of Pulitzer Prizes. When Jimmies are not being Rustled the kind Dr. enjoys being an amazing husband to his beautiful, soulmate; Anastasia, a Russian mail order bride of almost 2 months. Dr. Rustling also spends 12-15 hours each day teaching their adopted 8-year-old Syrian refugee daughter how to read and write.