Tactics & Strategies for Getting Out (& Staying Out of Debt)

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Tactics & Strategies for Getting Out (& Staying Out of Debt)

Audrey Plum is a former financial advisor, now stay-at-home mom, who writes about all things finance. She’s passionate about helping others reach their financial goals, after having gone through several struggles herself. When she isn’t working, you can find her in her kitchen cooking for her friends and family.



In an economy where student debt is the commonplace and housing prices are skyrocketing, paying off debt is often seen as the ultimate financial goal. Unfortunately, it’s all too easy to rack up or swim in debt, especially when it comes to the use of credit cards. In fact, CNBC’s report on millennial debt reveals that their biggest source of outstanding payments are credit card bills. This troubling trend signals a refusal to let go or make lifestyle changes despite having a significant amount of personal debt. While some can manage paying their debt and living somewhat comfortably, too many are living paycheck-to-paycheck — a vicious cycle that can mean they hang precariously on the edge of “barely making it.”

That said, there are plenty of strategies to avoid or address this problem, most of which can be combined to eliminate debt as quickly as possible. We’ve outlined a few to get you started:

Follow a strict budget

The number one thing you can do to get rid of your debt is to budget — this way, you can be sure you’re allocating enough to pay it off within a given period of time. Budgeting requires a lot of discipline, but fortunately there are many ways to go about it. For one thing, you can use mobile applications to keep track of your day-to-day spending, or make use of labeled envelopes for each bill. Seeing the numbers in real time or setting the money aside from the get-go can sometimes help avoid misallocating money or going over budget.

Cut costs where you can

Something that goes hand-in-hand with budgeting is finding ways to cut costs where possible and then allocating the money to cover debts or other bills. It doesn’t even have to be big changes, as even small things can go a long way. Marcus’ guide to getting out of debt points out a variety of ways you could cut costs at home — from foregoing takeouts and cooking food instead, to cancelling monthly subscriptions you don’t use anymore. You can even try selling your pre-loved clothes and items online. Our writer, Ally Girone, also recommends a variety of small ways you can save, such as buying second hand appliances, making your own cleaning supplies, and learning how to do your own DIY maintenance. Overall, small things like this can add up over time, and help you pay off your debts much faster.

Set up automatic payments

In today’s increasingly digital world, everyone should set up automatic payments for their bills and debt. This way, things are paid in the background automatically, and you can avoid late or missing payments. Contact your bank to ask if they can make automatic payments to the institutions you owe, or look at their website to see how you can set it up.

Make bi-weekly payments

This is a way to trick yourself into paying more — and the best part is, you won’t even feel it. Inquirer’s Anthony Jobs explains that bi-weekly payments can help you get ahead of your debts, versus paying them off monthly. To put this into perspective: Paying $200 bi-weekly for 1 year (26 weeks) gives you $5,200, but paying $400 monthly for the same time frame equals just $4,800. The magic behind this is that twice a year, you’ll receive three paychecks in a month, allowing you to pay a total of 13 months in a year.

Create an emergency fund

Life happens, and being prepared is a way to avoid mountains of debt. After all, we all know that unexpected expenses can sometimes be costly. Start small, and set aside some money every month. It can be anything from $50 to $500 — whatever you can set aside, do so as it’ll be worth it. Even if you have an effective budget in place, it pays to be prepared as an emergency fund can help you weather a financial storm. Like your bills, set up automatic transfers into a designated emergency savings account, so you can build up the funds without having to think about it.

At the end of the day, staying out of debt is essential for your financial future and wellbeing. Follow our tactics above to eliminate and avoid racking up more debt, and to start reaching your financial goals as soon as possible.