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Personal Finances


To get out of debt, you need to be intentional with your money. Reach your goals faster with our tools for evaluating your debt load, developing a repayment strategy, and staying committed.

Jump to: Step One Step Two Step Three Step Four Step Five

Step #1: Get Your Budget In Order

To get out of debt, you first need to take a good look at your budget. You do this before you develop a debt repayment plan for two reasons:

Your goal is make sure your needs are met and find ways to free up income so that you’re able to spend more on debt repayment.

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Life Guidance for:


Ready to take control of your finances? See what steps to follow to develop a spending and saving plan and follow through on it.


Step #2: Stop Creating More Debt

This is why building a budget is a critical first step. Though it might be challenging, you’ll need to stick to your plan to avoid using credit. To help you stay the course, identify spending triggers and barriers to success.

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If you think you’ll be tempted to overspend, it’s good to know your triggers. Ask yourself:

  • When am I tempted to use credit to buy something I can’t afford?
  • What do I tell myself when I end up adding to my debt?
  • In that moment, do I feel sad, mad, disappointed, frustrated, etc.?

It’s important to reflect and recognize what leads you to spend when you shouldn’t. Common triggers include retail therapy, boredom, leisure, and justification.

sandwiches in a refrigerator section at the grocery store


Barriers are things that keep us from doing what we know we should do, and they get in the way of behavioral changes and success. Barriers can be difficult to identify and can be either easy or hard to overcome.

For example, if you’re trying to reduce spending on eating out, you’d probably aim to cook at home more. However, the physical act of preparing a meal can be enough to keep you from doing so; instead, you find yourself in the drive-thru.

To figure out your barriers, think of an action you want to do. For example, “I only want to go to the grocery store once a week.” Then ask yourself why you don’t do this to get down to the barrier that is stopping you from accomplishing this action.

Step #3: Make Your List

To develop your get-out-of-debt plan, you need to know where you stand with your debt. This requires gathering the details and putting together a list of everything you owe.

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Know What You Owe

Use our free, fillable worksheet to organize your debts. Record the company/creditor, current balance, interest rate, minimum monthly payment, and payment due date for each debt.

Step #4: Make Your Plan & Set Goals

As you develop your plan, you’ll need to consider how much extra money you can afford to put towards your debt each month (above the minimum payments). Again, you’ll do this by reviewing your budget and finding ways to trim it so that you have extra money to put towards your debt.

Next comes the planning. In some cases, it’s beneficial to consider a multistep approach. For example, you might refinance your loans or consolidate your revolving debt before moving forward with the stack or snowball methods. Evaluate each option and pick the ones that work best for you.


Refinancing involves replacing an existing loan with a new loan, ideally with a lower interest rate and/or lower monthly payment. While this isn’t a payment plan, refinancing debt can be a good strategy if you have debt with high interest rates.


When you consolidate, you take out one larger loan and use that loan to pay off multiple smaller loans. Instead of having numerous minimum payments to make, you’ll have one. In addition to reducing your monthly payments, it’s possible to reduce the interest and the time needed to pay off.

Highest %

Stack Method

This debt repayment strategy is the one that typically costs the least over time because it focuses on paying the debt with the highest interest rate. To help further reduce interest costs, consider refinancing or negotiating for a lower rate.


  • Order your debts by interest rate (highest to lowest)
  • Pay the minimums on all your debts
  • Apply the extra money from your budget to the debt with the highest interest rate
  • Continue to put extra funds toward that debt until it’s paid off
  • Once the debt is paid off, apply that entire payment to the debt with the next highest interest rate
  • Continue until all debts are paid off

Stack Method Example

Scroll to see more details
Example showing various sample debts listed by highest to lowest interest rate
Debt Balance Interest Rate Minimum Payment
Credit Card A $1,000 17.9% $15 + $100
Credit Card B $500 12.25% $30 + $115
Auto Loan $17,500 6.0% $350 + $145
Student Loan $23,000 5.2% $250 + $495
Lowest $

Snowball Method

The snowball method involves paying off your debt in order from least to greatest balance. This can be the preferred method for some, as you might initially see debts paid off quicker. Set goals, consider consolidating revolving debt, try refinancing, or negotiate for lower rates for greater impact.


  • Order your debts by balance owed (lowest to highest)
  • Pay the minimums on all your debts
  • Apply the extra money from your budget to the debt with the lowest balance
  • Continue to put extra funds toward that debt until it’s paid off
  • Once the debt is paid off, apply that payment to the debt with the next lowest balance
  • Continue until all debts are paid off

Snowball Method Example

Scroll to see more details
Example showing various sample debts listed by lowest to highest balance
Debt Balance Interest Rate Minimum Payment
Credit Card B $500 12.25% $30 + $100
Credit Card A $1,000 17.9% $15 + $130
Auto Loan $17,500 6.0% $350 + $145
Student Loan $23,000 5.2% $250 + $495

Once you’ve picked your debt repayment strategy, set goals for yourself. When will you aim to pay your first debt off? When will you aim to pay 50% of your debt off? What will paying off your debt enable you to do? Think about what means the most to you and include those goals in your plan.

Free Debt Calculators

Use our calculators to easily compare loans, determine how much debt you have, and explore ways to pay down that debt.

Step #5: Put In The Work

You have your budget, list, and plan. Now, you’ll have to put in the work to reach your goals.



Rates & Resources

To keep you from having to do all the math, we’ve provided rates & calculators for all kinds of situations.

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