Living With Debt

5 Steps To Start Paying Off Debt, No Matter How Much You Make

By | Wednesday, June 07, 2017

Late spring is what I like to call debt season. With a fresh crop of college grads entering the workforce, it also means a fresh crop of student loans to start paying off. Graduation season means first jobs, maybe first cars, moving to new cities, celebratory travel…basically, all sorts of ways to spend money.

While I definitely think life should be celebrated, and I completely support celebrating milestones like graduating college, I’m also a big fan of living debt-free. Debt is a not a foregone conclusion. It’s not something that you simply have to live with for the rest of your life.

You can start paying off debt at any moment in your life. If you’ve been waiting for the right moment, consider this it. I’m inviting you to start paying off debt today — no matter how much you make. (If you need some help, join the Bravely community here.)

Now listen, here’s the thing: paying off debt can be hard. It takes time to pay it off successfully. If you’re low-income, it takes real sacrifice and mental fortitude. You’ve got to stick with it through the highs and the lows, and believe me, there will be some lows.

But here’s the other thing: you can do it. You can totally do it. Through a combination of increasing your income, decreasing your spending, and beating the system (because we live in a broken system), you can take control of your debt and kick it in the face.

Step 1: Don’t Hate the Player, Hate the Game

Fact: the US financial system is broken. Unless you are part of the 1%, the American financial system is rigged against you.

The rising “gig economy” undervalues our labor and celebrates extreme sacrifice. Education is marketed as a non-negotiable but leaves people up to their eyeballs in debt. Wages are stagnated, the gap between the rich and the poor is growing, and Congress seems dead set on eradicating any kind of social welfare.

None of this is your fault. I repeat: none of this is your individual fault. We’re all operating in a system that works against the individual worker.

It’s easier said than done, but don’t feel bad about carrying debt. Debt comes with an emotional burden that can knock your socks off. You might feel embarrassed or ashamed of your debt. But remember: you’re the player. It’s the game that is going to hell in a hand basket.

Step 2: Focus on One Debt

When I first graduated college and started paying down my debt, I was all over the place with my plan. I applied a little bit of extra cash to all my loans and to my credit card. The results were…well, there were no results. I didn’t have a clear focus, and it was handicapping my payoff plan.

If you have multiple kinds of debt, pick one to focus on at first. I suggest going with your highest interest debt first. By paying off your highest interest debt, you save money in the long run, because you’re paying less in interest.

But you do you honey boo — if you need to knock out a lower interest rate loan first because it weighs on your mind, go for it.

By changing your mindset around how much debt you have, you’ll take back control over your money. So instead of looking at your collective debt of $75,000, break it into pieces. Say your debt looks like this:

-$40,000 across five student loans

-$12,000 across two credit cards

-$10,000 in one car loan

-$13,000 in medical debt

Pick one of these categories to start with. From there, pick one specific loan to focus on. Throw all your extra cash at it until it’s gone. Move on to the next loan until you’ve eliminated a category. Congrats — you’re doing the damn thing!

Step 3: Know Your Priorities

If you’re trying to save for retirement, pay off debt, travel, and buy a house in the next year, you’ll fail at every single one of those goals. Or at the very least, make yourself an anxious wreck trying to meet them all.

You have to prioritize things in order to get anything done.

At Bravely, we advocate you to start paying off debt as a way to take control of your finances, feel empowered by money rather than scared, and to save more money. After all, the less money you spend on debt, the more you keep in the bank.

Pick a financial priority and stick with it. Set a specific goal, and don’t give up until you’ve reached it. If you want to start paying off debt, sit down and come up with a reasonable timeline for you to be debt free. Put your other goals on the back burner until you achieve your first priority.

You might not need to totally abandon your other goals. If you make $68,000 a year and only have $10,000 in credit card debt, you can still contribute to your retirement accounts. Just make it the minimum to get your company match, and focus the rest of your free cash on debt freedom.

Step 4: Generate More Cash

More cash will help get you going no matter what your income level is. I used side hustles to pay off my own student loan debt.

You can pick up a side hustle, ask for a raise, slash expenses, or sell things to generate more cash. Track the new income you’re making, and put it all towards your debt.

Step 5: Rinse and Repeat

Like I said before, paying off debt takes a long time if you’ve got a lot of it. After you’ve chosen where to start, KEEP GOING.

I can’t emphasize this enough. It’s so important to keep chipping away at your debt. If you can make monster payments, awesome. If you can only throw an extra $30 at your debt, AWESOME. That still counts! You’re still doing great!

Do not give up on yourself. Keep on keeping on.

You can start paying off debt today. Take one of these steps now. You don’t have to climb your debt mountain in the next twenty-four hours. Try taking one of these steps and see where it takes you. Start using money as a tool, then take another step. Then another. Allow your financial literacy to snowball on itself, and to bring good things to your finances.

Kara Perez is a freelance writer and the founder of Bravely, a company that connects women and money. Visit, or follow Bravely on Instagram and Twitter.

Image via Unsplash

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