7 steps to debt free lifeIn a time when college is more commonplace than ever, many of us have found ourselves in major debt early on in our adult lives. And student loans are just the start – add on any credit card debt, car loans, and home mortgage you’ve accumulated and you’re looking at a lottery’s worth of damage.

Being in debt can cause unwanted stress, and even destroy your relationships, so it’s important to battle this demon head-on. Get out of debt fast and live stress-free by following this 7-step framework designed to track, manage, and eliminate your personal debts.

Step 1: Basic Organization

Depending on how much debt you have accumulated, it can feel a bit overwhelming. Alleviate some of this anxiety by laying everything out on the table. List out all of your debt into an Excel Spreadsheet, or just write them down on paper. Take note of your minimum payment, your annual interest rate, and the total balance remaining. Rank the debts with the highest balance and interest rate first and go down the list.

For example:


Debt Min. Payment Annual Interest Total Due
Student Loan 1 $50 6.99% $30,000
Car Loan 1 $147 5.99% $14,599


Step 2: Creating a personal budget

Now that you have a big picture view of your total debt, it’s time to create a budget to ensure you can make all the payments on time and eventually knock out the debt! Use my personal budget template to set up an annual and monthly budget. This will help you establish just how much you can contribute towards your debts each month. Complete this exercise, then come back for the next steps.

Step 3: Paying off your debts

Once you’ve established your budget and know just how much you can contribute, it’s time to determine which loan you’re going to knock out first. Look back at your list from Step 1 – you want to pay the debt you ranked as number one first, and make the monthly minimum payment on the others. Once the most expensive one is paid off, you want to move the money you were using to pay towards that one to the next one, which will help you pay it off faster, and so on.

Step 4: Avoid contributing to your debt

Now that you’re on a path to financial recovery, it’s important to steer clear of any habits that could contribute to additional debt. Avoid big ticket purchases and online shopping! If this is a struggle for you, consider creating boundaries that restrict the opportunity to act on unnecessary purchases. For ideas on how to restrict your online purchases, read my suggestions on how to avoid online shopping temptations.

Step 5: Maximize your income

Focus on things you can control. If you can, get a side hustle, such as photography or waiting tables, to earn extra income. Anything you can do to maximize your income is only going to help you pay down your debt faster, and get you to your desired level of freedom. A little bit a suffering now will go a long way.

Step 6: Avert your mind

Buckling down on spending isn’t a fun chore by any means, but it’s important to stay focused in order to pay off those debts. Journaling and meditating in the morning may help keep you stay focused on the end goal. By journaling you’re able to get those early morning thoughts and anxieties on to paper and out of your head. Meditating afterwards will help you gain clarity about what’s really important in your life and allow you to be in the moment.

Step 7: Celebrate the small wins

Setup mini rewards for yourself each time you hit a milestone. A good reward is attainable but challenging enough to truly feel like an accomplishment. Consider celebrating your first month of zero frivolous spending! Just be sure you aren’t celebrating your wins by spending too much…try to find rewards that aren’t monetary based.



You’re closer than ever to being debt-free. Once you have control over your money, you’ll feel more confident about moving forward. Take the power back, and lose that stress!