Getting rid of high debt will take hard work, willpower, and the determination to see it through until the end, but it is doable. Here, we’ve outlined six steps to help you start crushing debt today.

Step 1: Choose your debt-crushing method

There are two approaches toward getting rid of debt:

  • The snowball method, popularized by financial guru Dave Ramsey, involves paying off your debt with the smallest balance first and then moving to the next-smallest, until all debts have been paid off.
  • The avalanche method involves getting rid of the debt that has the highest interest rate first and then moving on to the debt with the second-highest rate until all debts have been paid off.

Each method has its advantages. The snowball method places a heavier emphasis on achieving results at a faster pace, which then motivates the debt-crusher to keep going. The avalanche method focuses more on saving money in overall interest paid on debts. There’s no right approach, and you can choose whichever method appeals to you more.

Step 2: Maximize your payments

Free up some cash each month by trimming your spending in one budget category or consider freelancing for hire and channel those freed-up or newly-earned funds toward the first debt on the list you created in Step 1. Don’t forget to continue making minimum payments toward your other debts each month!

Step 3: Consider a debt consolidation loan

If you’re bogged down by several high-interest debts and you find it difficult to manage them all, you may want to consider consolidating your debts into one low-interest loan. A personal loan from Climb Credit Union can provide you with the funds you need to pay off your credit card bills and leave you with a single, low-interest payment each month.

Step 4: Build an emergency fund

As you work toward pulling yourself out of debt, it’s important to take preventative measures to ensure it won’t happen again. One of the best ways you can do this is by building an emergency fund. Ideally, this should hold enough funds to cover your living expenses for three to six months. Start small, squirrelling away whatever you can in a special savings account each month, and adding the occasional windfall, like a work bonus or tax return, to beef up your fund.

Step 5: Reframe your money mindset

Sometimes, like when there’s a medical emergency or another unexpected and expensive life event, a consumer can get caught under a mountain of debt through no fault of their own. More often though, there is a wrongful money mindset at play leading the consumer directly into the debt trap.

As you work on paying off your debts, take some time to determine what got you into this mess in the first place. Are you consistently spending above your means? Is there a way you can boost your salary or significantly cut down on expenses? Lifestyle changes won’t be easy, but living debt-free makes it all worthwhile.

Step 6: Put away the plastic

Credit cards are an important component of financial health and the gateway to large, low-interest loans. However, when you’re working to free yourself from debt, it’s best to keep your cards out of sight and out of mind. You can set up a fixed monthly bill to charge one or more of your cards to keep them active, but only do this if you know you will pay off the charge in full before it’s due. Learning to pay your way using only cash and debit cards will also force you to be a more mindful spender.

Kicking a pile of debt can take months, or even years, but there’s no life like a debt-free life. Best of luck on your journey toward financial freedom!