7 Things You Must Do To Get Out Of Debt

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

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When you make the decision to get out of debt, it can be a little overwhelming to know where to start. It’s not enough to simply say that you want to be debt free, you have to take action too, and to be honest, it might make you a little uncomfortable. But there are just some things you must do to get out of debt and start creating a life you love. 

One thing is for sure, doing the same thing you have been doing is not going to get you to where you want to be. That’s how you ended up in debt in the first place. Instead, you need to start focusing on the habits you can change, start taking control of your finances and start taking steps to achieve your financial goals

 If you’re ready to cut your debt, live the debt-free life and change the way you manage your money, then here are some things you must do to get out of debt:

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

1 – Face Your Finances

This is the very first thing you must do if you’re wanting to get out of debt, because without it, you don’t know what position you’re in and what you’re working towards. 

This might make you feel uncomfortable, you might want to hide, but you absolutely must get it all out there so you can see exactly what you’re working with. 

Find out what debts you have, all of them, and write them out. Detail how much is owing, what the repayments are and what the interest charged is. Then work on what income you have, how much it is, how often it is. And start working out your fixed expenses, what you absolutely must pay. This is going to start giving you an idea of what your financial position is. 

Use this free debt tracker template to get a clear idea of what debts you do have:

2 – Analyse Your Spending (And Cut The Excess)

How much money are you actually spending, and on what? The best way to see this is to get your bank statements for the last few months (at least one month) and start looking at where your money is going. Add it up. Are you spending more money on food than you expected? Or coffee? Or clothes? What feels excessive to you? 

If you’re wanting to pay down your debt fast and become debt free, then you’re going to have to cut back on your spending somewhere. Find areas where you feel you’re spending more than you think you should, and start to cut back. 

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

3 – Set A Goal And Create A Plan

One of the most important things you must do when you’re working towards paying off your debt is to set your goals and create a plan. Sure, it’s great that your goal is to pay off all of your debt, but that’s far too broad of a goal to work with. 

Instead, break it down into smaller chunks so you can work on them, get some wins under your belt, and feel good in the process. 

Perhaps your first goal is to set up an emergency fund and reach a certain amount in there, or to pay off your credit card and cancel it, or to stop buying new clothes for a year. Whatever your goal is, write it down, and create an action plan on how you’re going to achieve it. 

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

4 – Stop Using Your Credit Cards

Here’s the straight up truth: you’re not going to be able to pay off your credit card (debt) while you’re still using it. Fact. 

If you are relying on your credit card to make purchases still, then you’re not ready to be debt free and you’re not ready to take this big step to achieve your financial goals. It really is a mindset shift to be able to work towards paying off your debt and you have to be committed. 

Just because you put $100 purchase on your credit card and pay $150 off, doesn’t mean you’re in the clear. The money you have ‘available’ on your credit card isn’t yours, it’s debt waiting for you to use it. 

Cut up your credit cards, remove them from your Apple Wallet, call your credit card company and freeze your account. Whatever you need to do, but do not make any more purchases on your card. 

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

5 – Stop Going Into More Debt

On that note, you’re also not going to become debt free if you keep going into more debt. This includes those consolidation debts that often come with a hefty price tag (check the fine print) and can seriously harm your credit rating. And don’t even get me started on payday loans – no, no, no. 

If you’re having trouble making your payments on your bills, then call the company and explain the situation, and ask if you can make a partial payment or have an extension. Often this will avoid late payment fees and the companies much prefer you to be honest than for you to just ghost on your repayments. 

And, if you’re having trouble making your payments, but you’re still going out to dinner on Friday night with friends, then you need to seriously reevaluate your priorities and start taking your finances seriously. You were adult enough to go into debt, you need to be adult enough to make your repayments. It’s tough love but it’s true. 

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

6 – Create A Budget

The fastest way to achieve your financial goals is to create a budget. Budgets aren’t meant to be restrictive, instead, they are meant so you know what money you do have to spend, and so you can be clear about how you can achieve your financial goals, like becoming debt free. 

Plus, they are not as complicated as you might think. Simply work out what money you have coming in, then work out your fixed expenses (rent, mortgage, insurance etc), then work out your variables (grocery budget, spending money etc) and tweak your variables as needed. Simple. 

Need a budget template? Download this free one:

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.

7 – Don’t Be Too Strict

Think of paying off your debt as a marathon. It’s not going to happen in a week, or a month, or maybe even a year. Which means the choices you make need to be sustainable. If you’re super strict on your budget, you’re not going to stick with it. Instead, give yourself adequate spending money so you can still enjoy your life, and pay off your debt too. You may tweak this as you go along and work out what balance works best for you. 

Paying off your debt takes a while, so set yourself realistic goals and reward yourself when you achieve them. It took a while to get into this much debt, it’s going to take a while to get out of it. But you can do it. 

So you've decided you want to get out of debt, but you have no idea where to start or what you're supposed to do? Here are the things you must do if you want to get out of debt and achieve your financial goals.
Written by
Krystal Kleidon

Krystal is a Wife, Mama, Author, Paramedic, Coffee Lover and an all-round bunch of awkward. She can be found spending time with her super cute family or geeking out over the latest Marvel movie. Her goal in life is to empower women and she does so with her sites Hello Brazen, Project Hot Mess and The Empowered Mama Project.

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