Facing Roadblocks to Get Out of Debt? 4 Tips that Actually Work

Getting out of debt is like trying to climb out of a deep, muddy pit. As soon as you seem to grab a toehold, you slide down again. 

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American household debt among 340 million Americans hit a record $14.6 trillion in the spring of 2021. 

Let’s go over a few roadblocks people often face to get out of debt and tips to get out of debt (that actually work!) so you can fix your situation once and for all.

Roadblock 1: Extra expenses keep cropping up.

Right now, I’m typing away at this article in our veterinary office. Our dog might have hip dysplasia, so you bet that means spending extra on veterinary care. Such a bummer! (For the pup and for us. Luckily, we think he’ll be just fine.)

The point is, extra expenses come up all the time. Whether you find yourself in a situation where you need to put an expensive part on your car or need $700 worth of X-rays for your dog, you often can’t seem to surmount your debt because those extras keep resurfacing. 

Roadblock 2: You lack mental commitment.

Your mental commitment sometimes means everything. When you’re more mentally committed to a task, it’s more likely that you’ll achieve it.

Most people set goals and feel highly motivated for a few days, but after a few weeks, they face an obstacle or bad habits creep back in. It’s easy to then quickly lose motivation and procrastinate on your goals. If you’re never really committed in the first place, how well do you think you’ll be able to meet your “get out of debt” goals? Probably not very well.

If you want to dig your way out of serious debt, it often requires intense commitment.

Roadblock 3: You can’t free yourself from lifestyle creep. 

Have you ever wondered why people spend so much time trying to keep up with their neighbors? Remember this: They’re probably broke. Fancy toys, cars and houses cost a lot of money. Freeing yourself from this lifestyle can keep you from ending up in the same boat.

Roadblock 4: You don’t have a plan. 

You need a plan to attack your debt. If you don’t have one, it’s easy to stay in a debt cycle. Many experts tout tricks you can implement, but the most important thing you should do involves sitting down with all your statements and figuring out how much you owe. 

Your list might look something like this:

  • Student loans: $30,000 at 5.8%
  • Mortgage: $200,000 at 2.50%
  • Personal loan: $4,000 at 11%
  • Auto loan: $30,000 at 9%
  • Credit cards: $6,000 at 18%

Only then can you actually make a plan for eradicating your debt. (We’ll go over a few ways you can tackle debt in the next section.)

Get Rid of Debt: Tips that Actually Work

Let’s take a look at a few tips that you can use to get rid of debt. No one way is the “right” way to go about it — you have to make the right decision for you.

Tip 1: Choose a payoff method.

Let’s take a quick look at these debt totals again:

  • Student loans: $30,000 at 5.8%
  • Mortgage: $200,000 at 2.50%
  • Personal loan: $4,000 at 11%
  • Auto loan: $30,000 at 9%
  • Credit cards: $6,000 at 18%

You may consider using the debt snowball or debt avalanche method. The debt snowball method involves paying off the lowest amount of money first. In the example above, you’d make the minimum payments on all loans but pay extra on the $4,000 personal loan because it’s the lowest amount. Doing so gives you a quick win. 

You may choose to use the debt avalanche method instead. This type encourages paying off the loan with the highest interest rate first. In the case above, the highest interest rate is the credit card debt with an 18% interest rate. You’d tackle that type of debt first.

Whatever route you choose, it’s important to have a plan. 

Tip 2: Set a goal for the extra payoff amount.

How much extra can you put toward the debt you chose to tackle first? An extra $200? $500? $50? 

You can use a payoff calculator to see how much faster you’ll pay your debt off (and the amount you’ll save on interest) when you kick a specific amount of money toward it. 

If you can’t put a lot of money toward your debt right now, that’s okay. You may want to commit to more later on by slowly increasing the increments you pay.

Making extra payments also has other benefits. You’ll also improve your debt utilization ratio, which tells you how much debt you use. You’ll also improve your credit score. Setting a goal might also make you realize that you need a budget to figure out how much extra money you can contribute. 

Tip 3: Get a side hustle.

Ah, the side hustle option. When you can keep the amount you earn from your regular job and only send the side hustle money toward paying off extra debt, it’s almost a way to compartmentalize your earnings. 

What can you take on as a side hustle? Can you design websites? Write articles? Consult? Rent out a room in your home? There’s a guy at the end of our road that rents out three or four different campers. 

The point is, the sky’s the limit. Whatever you can do well, make money off of it and throw it toward your debt.

Tip 4: Stop spending money. 

Impossible. Right?

Stop spending money on impulse purchases, things you don’t need and things you’ll just throw away after six months. I bet you can find 100 things in your home that you’ve never used and that you don’t need. (I think I can spot 10 things just from what I can see sitting on my living room couch.)

Reducing your spending can free up money that you can put toward your debt. Once you make the commitment to do that, you won’t worry about where the extra money will come from for debt payoff.

Just make sure you actually do put the extra money toward your debt!

Dance Around the Roadblocks and Get Out of Debt

Why do you want to get out of debt? Think about what you want to accomplish, and how having no debt will help you get there. Having a clear reason to leave debt in the dust can help you figure out how to stay motivated to dig yourself out of that deep, muddy hole.

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