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From the Experts at

8 Ways to Get Out of Debt in 2020

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To get out of debt, you need a plan and you need to execute that plan. To help, the team shares these 8 ways you can approach how to pay off debt and leave some, if not all, of your financial burden behind:

  1. Gather your data—bills, credit reports, credit Score, etc.

  2. Make a list of your debts and income

  3. Lower your interest rates

  4. Pay more than you have to pay

  5. Earn more money

  6. Spend less money

  7. Create a budget and debt pay-off plan stick to them

  8. Rinse and repeat

Keep this checklist where you can see—like your refrigerator door or your vision board, if you have one, and make it a goal to check a task off the list regularly. More frequently if you want to lower your debt load more quickly.

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    1. Gather Your Data

    To start to get out debt, start by knowing where you stand. You want to have a complete picture. Here’s what you need to get:

    • Your most recent bill statements for all credit cards and loans, including student loans.
    • Your credit reports, so you can check for accuracy and identify all recorded debts.
    • Your credit score to find out whether you’re eligible to lower your interest rates or for a debt consolidation loan.

    2. Make a List of Your Debts and Income

    Once you have your data in hand, make a list of all your debts, being sure to include:

    • Creditor’s name
    • Balance
    • Minimum monthly payment
    • Interest rate

    Next, list how much you need to pay in order to zero-out the debt’s balance within three years or whatever your target timeframe is. Remember to include items not listed on your credit reports, such as family loans, medical bills and recurring bills, such as groceries and utilities.

    And know your monthly take-home pay. This is the baseline you have to work with toward paying down those debts and buying groceries and such. The amount will also give you insight as to whether you need to take advantage of Ways 4 and 5 below—or how much you need to consider ways 4 and 5.

    3. Lower Your Interest Rates

    Interest on loans or credit cards can make trying to get out of debt seem like running a losing race. The more you owe, the more interest you’re charged and the more you owe. And round the cycle goes.

    If you find yourself with more credit card debt or debt from loans than you can handle, one way to at least start getting ahead of that debt is to pay less interest if possible. Here are ways you might lower your interest rates.

    Get a Credit Card with a Lower Interest Rate

    Depending on your credit rating, you may qualify for a credit card that has a better interest rate than your current card. Better yet, you may qualify for a credit card with an introductory 0% interest rate for 12 or months or more.

    You need a credit rating of at least good for the best chances. If you don’t know what your credit rate is, you can get your free Experian VantageScore credit score and rating on

    If your credit rating is good or better, look into a low APR credit card and see if you can beat your current APR.

    Here’s what a lower credit card interest rate can mean. Say you have a loan or credit card with a $5,000 balance, make payments of $200 and don’t charge anything else to the card:

    • At a 15.24% APR, you’re charged $1,054 for interest and will pay off the balance in 31 months.
    • At a higher APR of 29.96%, you’re charged $2,937 and will pay off the balance in 40 months.

    That’s a difference of $1,883 and 9 months of payments. Even lowering your interest rate a few percentage points can make a big difference in how quickly you can get out of debt.

    In that same scenario, if you paid an extra $50 a month, for a total of $250 a month, you would pay off the balance in 24 months at 15.24% APR and pay $805 in interest. At the higher APR of $29.96% you would pay off the balance in 29 months and pay $2,014 in interest. Paying just $50 extra a month could shave off 7 to 11 months of payments and save you quite a bit in interest.

    You may also be able to negotiate with your credit card issuer to get a lower rate on your current card.

    Get a Balance Transfer Credit Card with a Lower Interest Rate or 0% Intro Rate

    Another option is to get a balance transfer credit card with a lower interest rate and/or an introductory 0% APR. A balance transfer card lets you transfer balances from your old card to the new card.

    If that $5,000 balance on a card at even 29.96% can be transferred to one with 0% interest for 18 months, you that $1,498+ in interest each month. And if you put that money saved, toward the card’s balance, you pay the full $5,000 balance off in just 7 months!

    Get a Loan with Lower Interest Rate

    Another option to get rid of high-interest debt is a personal loan, other loan or home equity line of credit that has a lower interest rate. Personal loans often charge lower interest rates than credit cards. And, and if you have a home and can tap into its equity, you can get an even better interest rate.

    If your car loan is the cause of your debt, you may be able to refinance a high-rate auto loan.

    Consolidate Student Loans

    If student loans have you in debt, look into student loan consolidation and income-based repayment at

    4. Pay More than You Have to

    There’s no law that says you have to make only the monthly minimum payment on your credit card or loan. You can pay more. However, if you pay your mortgage off early, make sure there’s no prepayment penalty.  And, for a loan, make sure your extra payments go to the principal and not the interest.

    Look at that $5,000 credit card bill to see how making more than the minimum payment can help. If your monthly payment is $114, you’ll pay on that card for more than five years to pay it off. And you’ll pay a total of $7,292 with $2,292 in interest.

    Up that $114 payment to $300 and the card is paid off in just 19 months and you pay only $642 in interest.

    The same principle applies to any loan—a mortgage, a car loan or home equity line of credit.

    5. Earn More Money

    Another way to get out of debt is to earn more money. That doesn’t have to mean a new job or a raise—although those would help. It can simply mean taking on a side gig or other tactic to add some extra money for a time.

    One of the staffers walks dogs on the weekend for a few extra dollars.

    Other options include taking online surveys, Acorn, an online app that lets you automatically invest your spare change and doing odd jobs, even babysitting, one day a week.

    6. Spend Less Money

    The flip side of earing more is spending less. Ideally, depending on how far out of debt you need to get, you might do both. And there are a lot of ways to save a little that can add up—from eating out one less day a week to skipping your morning coffee out or taking your own snacks to the movies rather than paying $30 for popcorn, candy and a soda.

    The extra money you save—just like any extra you earn—can go straight to paying down your debt.

    7. Create a Budget and Debt Pay-Off Plan and Stick to Them

    Before and again after you’ve gathered your total debt and have decided how much extra you can pay each month and have adjusted interest rates and earning or spending, you want to have a goal and to know where you’re heading and how you’re doing. A budget and/or a debt management plan or debt pay-off plan can help and they don’t have to be complicated. In fact, many online banks and credit unions offer free budgeting tools.

    A budget shows you what you’re spending where and where it makes the most sense to put your money whether it’s from interest saved or dollars earned. The latter becomes your debt pay-off plan. It can be a part of your budget or separate.

    A good way to approach a debt pay-off plan is to take the total payoff number you calculated in Way number 2 and use it as a goal to work towards by:

    • Totaling the three-year or your chosen timeframe pay-off amount for all your credit cards.
    • Adding the monthly payments for all other debts.
    • Writing down the result as “Your Total Monthly Payment.”

    Once you have that:

    • Determine if you can afford to pay the Total Monthly Payment until your debt is paid off.
      • If not, contact a credit counseling agency and/or bankruptcy attorney for advice. Remember though, bankruptcy has a huge impact on your credit score, and if you’re able to work out a payment plan with your creditors, it can be avoided.
    • If doable, pick one debt to pay off first. Start with paying off the debt with the highest interest rate or lowest balance. That’s your “target debt.” Paying your target debt off first is known as the “debt snowball” or “avalanche” method.
    • Set up “auto pay” for the required minimum payment for all but your target debt.
    • Pay as much as possible toward target debt until that debt is paid off.
    • Choose a new target debt and pay extra toward that one, and so on.

    8. Rinse and Repeat

    Once your budget and debt pay-off plan are in motion, don’t want to get too comfortable. Track your spending and habits closely to make sure you’re making progress. And make adjustments when needed. Revisit your budget and adjust as you can to stay the course until your debt is paid off.

    Create an Emergency Fund

    You may think that while paying off debt you don’t have money to save, but saving is important. Life happens, and if anything comes up, like a job loss, medical bill or car repair, you need to be able to cover it.

    The suggested amount to have in an emergency fund is three to six months’ worth of expenses. If that amount isn’t possible, aim for one months’ worth, which is still a great starting point.

    Whether you start saving now or pay some debt down first, make it a goal to have an emergency fund. As you pay down your debt, you can shift some of the money you’re using to pay debt to pay yourself in the form of creating a savings account for emergencies.

    Stick to It

    Just like losing weight, losing debt takes time. But diligence can make it happen. Don’t fret if you need to make adjustments along the way or if you slip up. It’s not about a quick fix, it’s about taking control and changing your habits and behaviors so you can achieve your financial goals.

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      • Kiaunta Hubbard

        Maintain permanent and consistent employment in shaky economy…also will help.

        • Gerri Detweiler

          True! If you can.

        • Kay Xu

          Good advice 🙂

      • Gerri Detweiler

        If you cash in your IRA early, you will not only pay taxes on it (unless it is a ROTH), you also pay a 10% early withdrawal penalty. That means that money is not going to go very far. Before you use your retirement money to pay off consumer debt, I would suggest you at least talk with a reputable credit counseling agency to see if there’s a way to get out of debt without using this money that you will no doubt need when you do retire.

      • Credit Experts

        That’s good to know. Thanks for sharing your encouraging experience.

      • Gerri Detweiler

        Stan –

        Thanks for the feedback. TWe’d love to hear more about how you got out of debt!

      • Credit Experts

        Congratulations on your progress.

      • Credit Experts

        Agreed. Thanks for adding that.

      • justpeachy

        That’s great. I used them about 12 years ago and it was one of the best things I have ever done.

      • Credit Experts

        Quincy —

        If you want some early small victories, some people recommend the “snowball” method, where you pay minimums on the largest bills while you work at paying them off, smallest to largest. Once the smallest one is paid off, you put the money you had been paying toward the next-smallest and so on. Another way is to pay the highest-interest-rate balance first. Use the one that makes the most sense to you. Read more here: 5 Ways To Get Out of Debt: Which Will Work for You?

        And good luck.

      • Victoria G.

        What is CCCR? Thank you.

        • Gerri Detweiler

          I assume Jeanne meant CCCS which stands for Consumer Credit Counseling Services. You can find an agency via the website of the National Foundation for Credit Counseling.

      • Victoria G.

        And how would this impact/affect my credit score? I have a very good credit score, but I have A LOT of debt that I would like to pay off/consolidate. I’m just afraid/nervous of using an “agency,” for lack of a better word. Thanks in advance for any advice you can offer!

        • Gerri Detweiler


          If you have a lot of debt, understand that it probably already is affecting your credit scores. (I would recommend you go ahead and get your free credit score to find out how.

          In addition, we’ve written more about how these options affect your credit here: Will Debt Consolidation Help or Hurt Your Credit?

      • Gerri Detweiler

        Glad to hear your score is good and you are hoping to keep it strong! Thanks for the feedback.

      • Gerri Detweiler

        Paying those old collection accounts won’t improve your credit scores in the short term. You can read more about that here: The 7 Biggest Questions About Debt Collections & Your Credit

      • Gerri Detweiler

        It sounds like you have done what you can to protect yourself (credit freeze, law enforcement etc.) I am not sure what your bank will do but I can’t imagine they will pursue you for a crime committed against you. Have you changed the bank account you deposit your Social Security check into? If not, talk with your bank. It would seem to be a reasonable precaution.

      • Gerri Detweiler

        John – Thanks for your kind comments! Some creditors have their own policies that may not make sense to consumers, but are part of the way they do business. Credit unions, in particular, since they are member owned may hesitate to settle debts. But you may be able to negotiate when it goes to collections. I will ask Michael Bovee to weigh in.

        • John T

          That would be great Gerri, thanks. I hate that this last debt is hanging over my head. On a different note, real excited to see the changes in Fico 9. Apparently, settled debts don’t negatively affect your credit score anymore when a creditor uses Fico 9. Is that your understanding of it?

        • Michael Bovee

          Hi John,

          As Gerri mentioned, some banks, like credit unions, and smaller state or regional banks, are difficult to negotiate and settle with. My experience with accounts like this will often be:

          Do not target them for a reduced payoff at all.
          Settlements are not reached until attorney placement, or once sued.

          The settlement percentage you may be able to achieve are not great in these instances. Realistic targets are often not going to be below 50% of today’s balance, and can be upwards of 80 percent.

          Great job negotiating your other credit cards! Those deals you settled for are not common place at all.

          Given your success with settling your Citibank and Capital One accounts, you will come out way ahead of what I would consider typical (given your list of creditors), no matter the outcome with the credit union debt.

      • Gerri Detweiler

        Thank you! But I am not sure I understand your question – using what? Credit scores? If so, most creditors of all types do.

      • Credit Experts

        It can’t hurt to ask. You may also want to check with a bankruptcy attorney. (An initial consultation is usually free.)

      • Credit Experts

        Yes, you are, per terms of original agreement. Once the balance (and any interest or fees) are paid, you do not owe further. But if you have not canceled a card, we suggest you reconsider. Here’s why: Does Closing Your Credit Card Account Affect Your Credit Score?

      • Gerri Detweiler

        It sounds like the very old debts should not appear on your credit reports. It’s hard to say exactly because it’s not clear exactly what’s being reported, but we wrote about that issue here: Does Your Old Debt Have an Expiration Date?

        As for the recent delinquent debts, paying them probably won’t boost your credit scores in the short term.

        It might make sense for you to talk with a credit counselor to see whether they can help you come up with a plan for getting some breathing room in your budget. You can find a counselor through the National Foundation for Credit Counseling.

      • Lil25

        My only debt is student loan debt. The amount is currently $62,892. I make one payment for all my loans. They are all federal loans from grad school at 6.8% interest, so consolidating will not help. Neither will bankruptcy. I already do autopay. Which of these will tips will help? I do not qualify for PAYE or IBR or any type of loan forgiveness.

        • Gerri Detweiler

          Why don’t you qualify for IBR or PAYE? Is it because your income is too high to reduce your payments? If that’s the case, and you’ve exhausted all your options, then I am at a loss in terms of what to suggest other than to encourage you to continue to pay as much as you can and check back into those programs from time to time to see if requirements have changed. Student loan debt is an enormous problem and for many there is no simple solution.

        • Eric Camp

          Look into consolidating the loans with a private lender like Darien Rowayton Bank or SoFi. We just reduced the interest rate on my wife’s loans from 7.25% to 3.5% and the rate on my student loans from 5.75% to 3.75%.

      • Stephanie

        I have the worst credit score and am losing sleep from being in debt. I need a plan to get myself out of debt so I can move and not be stressed. What you suggest be my best course of action.

        • Credit Experts

          Stephanie —
          It couldn’t hurt to talk to a credit counselor, particularly because this is affecting your health. Here’s how to find a counselor through the National Foundation for Credit Counseling. Depending on your amount of debt and income, it may or may not be the right answer for you. From your question, it’s hard to know whether you should be talking with a bankruptcy attorney, credit counselor or simply someone who can help you with a realistic budget you can stick to. But we hope a counselor, with more information about your specific situation, can offer guidance.

      • Mary

        It’s true that many people get into debt because they lose their jobs. But some people get into debt despite having well paying jobs. It’s good to share information so that people have a plan to save while they have a job so they can weather a job loss. And for those who accumulate debt beyond their means while employed, it’s good to give them a plan of action to “right the ship.” Hope you find something that helps you weather your storms.

      • The Coupon Vixen

        These were all fantastic to tips and I used many of them to help me get out of debt. I also learned how to save more money on everything from groceries to clothing. Having this extra money helped me pay down debt sooner and I like to help others do the same on my blog.

      • Kent Salmen

        Just spend less than you make.

      • Don

        Hi, I am trying to work through several old debts without filing bankruptcy and have been looking for a “how to” book that would help. I found this one online but can’t seem to find any other information about it, are you familiar with this book or do you have another all-in-one book that you can recommend?



        • KerriD

          hi. if they are over 7 yrs old dont worry about them. in addition, some companies will sell the debt to 3rd party collectors to try to collect even will attempt to threaten or scare you to pay. let it go. if it is student loans etc, pay those with a consolidation contract (not loan) with the federal student loan org…… they will work with you.

      • Christy Harmon

        Jeanne, I wanted to check with you to see how CCCR is working for you. I am very worried to jump to a credit counseling company for fear that they will “hold” my payments until there is enough money in an account to pay something causing my payments to be late, ultimately ruining my credit.

      • Wayne

        Dave Ramsey is the way to go! My wife and I took his course through our church but you can take it online. He’s funny, informative and gets to the point. I like the facts and my wife likes to have fun so his course was perfect. It even helped our marriage. When BOTH husband and wife are cleaning up the debt mess it makes it that much easier however, we did see a lot of single people taking the course too. We started in Oct. 2014 with 48K between all the loans we had together and now our debt free day is September 18th 2015!

        Dave Ramsey’s course is the real-deal, a true blessing from God.

        • Credit Experts

          So glad you have found a debt-reduction strategy that works for you. Thanks for sharing.

      • TheRagingScotsman

        One factor I have not seen mentioned here is what I learned when entering the field of sales. A job is just that; a means to an end. A job produces a predictable income stream, which is why we were taught that j.o.b. = Just Over Broke, or, where most people are comfortable remaining for the majority of their working lives, whether out of habit, fear, or ignorance of what opportunitieseee are available to them.
        The sad fact is that usually only the wealthiest kids are taught good financial practices and habits, so they have advantages throughout their entire working lives. Those of us less fortunate have to figure out (too late – if ever) that creating/establishing multiple streams of income is one of the most certain methods to ensure a better life. Sure, many people think opening a business will make them plenty of money, but the reality is more like plenty of headaches before plenty of money. Many people start a family early in life, and this also can be an obstacle to financial success.
        We are a nation that pays far too much attention to education for the young, but not financial education, just all the subjects one needs to have a well-rounded understanding of the world and our place in it. Why not give our children the financial tools for them to succeed while their minds are most formative, so they can be prepared to be entrepreneurs at an earlier age? This may be the one thing we are missing which could change our entire future as a nation.

      • Vaden

        I had credit card debt and I used Credit Advocates to help with the solution. Now that I am at the end of paying off the debt I just wanted to cry when I saw how much I was charged in fees – it was a fee for everything including phone calls made for me. At least between a forth and half of the monies sent went to them. If I had it to do over again I would call the credit card companies and try to repay the lesser amount over time. It seems to me that the companies that say they can help are only there to take your monies at a very high rate of fees, etc.

      • tasha612

        Portfolio Recovery just got a judgment against me for 10000 – it was a motion for summary judgment and it was pre determined before I got to say mediation was offered…..I am on 100 percent disability and only work about 12 hrs per wk so they cannot touch my earnings either – I am co owner of house in Fl but we have homestead…..I will be 60, husband is 66 — so exactly what do they hope in getting this judgment? The alleged debt was in my name alone..

        • Gerri Detweiler

          Who knows? If the statute of limitations was due to expire they may have been trying to protect their future ability to collect. It’s hard to say.

          • tasha612

            so to ease my stress, which ironically is a major component in my disabiiity, after I fill out their financial affidavit, I am assuming I won’t have to worry about them pounding on my door and taking our furniture? My 2013 tax statement Chase bank had sent me a 1099 C for over 20000 – with that when the acct tallied…..he still came out with an insolvency of over 49000 – this all happened rather fast as was not aware my depression also created a bipolar II disorder which is how I accumulated so much debt in such a short time – termed as “manic sprees” – to think I once was a high risk collector and i heard this term at least 2x a day and did not believe……..what is that they say about what goes around? Statute of Limitations with no signed agreement in Fl is 4 yrs..last time I had paid the “creditor” on this one was Nov 2011 – however I see another sitting in collections from Portfolio that says last py was 3/2011 and another from Unifund where lst pymnt was feb 2011 – statute expired…..would I call Transunion?

            • Gerri Detweiler

              The statute of limitations is different than the length of time an account can be reported. This article explains: Does Your Old Debt Have an Expiration Date? (I think that’s what you are asking.)

              • tasha612

                I know they stay on your report for 7 yrs……….but out of all of them while the others of course are on the report as not paid, they are not listed in a separate section that says “in collecions”……the ones that were on the report under the collecions status concern me because I ws sued on two of them……the small claims Calvary was very nice….after they obtained the judgment, I offered thme 300.00 and hey volantrly dismissed the judgment……….do you know how many points affect a credit score with a judgment? Portfollio will never get dime from me…..I offered them 1500 when a cousin offered me a loan and they scoffed………the only thing I have in the bank is my own money however I took out a collateral loan against its is secured……assuming if Portfolio tried to get it, then the bank has first dibs……….

      • Mike

        Hi Gerri. I’m trying to find a way to consolidate my credit cards. I’ve been denied consolidation loans and balance transfers. MY credit score is 669, but its due to the debt usage. I have an excellent payment history. Them more I search for answers, the more people are trying to sell me a product.. Where can I go for answers?

        • Gerri Detweiler

          Mike – will email you.

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