28 Ways to Get Out of Debt

Are you looking forward to the day when you can stop spending all your money on debt payments and start building wealth instead? Do you believe it’s even possible? We’re here to tell you it is possible—with the right plan. Sure, it takes some extra effort and determination, but it's totally worth it. Imagine a life where every paycheck that comes in is yours to spend. No more paying for the past. Eyes on today—and the future!

When it comes down to it, the usual tips like cutting up your credit cards and making coffee at home do work, but there are even more clever ways of getting out of debt we want to share with you—28 ways, in fact!

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Best Way to Get Out of Debt

Before we jump into our practical tips to pay off your debt faster, let’s talk about how to get out of debt in general.

First things first: Decide you’re done with debt—right now. That means no more swiping that credit card. And no more taking out personal loans for things you can’t pay cash for.

Have we hit a nerve yet? For some of you, this might be a big change of pace. But if you really want life-change, you’ve got to stop doing what you’ve always done and make room for something new.

Here's the good news in four simple words: You. Can. Do. This. By setting and sticking to financial goals, millions of people have gone from feeling crushed by a mountain of debt to (literally) screaming with joy. We’ve seen it. (Seriously, check out these Debt-Free Screams!)

How did they do it? They followed the 7 Baby Steps. This proven plan shows you how to get out of debt for good and start building wealth. With the Baby Steps, you’ll stop worrying about how to make ends meet and start feeling excited about where your life is headed.

It is possible. Remember: You. Can. Do. This. How? Use these debt-busting tips and get the weight of those debt payments off your shoulders and out of your life. Forever.

Get Out of Debt Fast With the Debt Snowball

Real quick, before you use the debt snowball (and these 28 tips) to get out of debt, you need to build a safety net. We call this Baby Step 1: saving $1,000 for your starter emergency fund. This money is for emergencies only! So, once you’ve stored it away in a savings account, don’t touch it. Make sense?

Okay, now that you’ve got that buffer between you and life’s little emergencies, it’s time to go all in—paying off all your debt (except the house) using the debt snowball method. (We call this Baby Step 2, by the way.)

Here’s how it works:

• List your debts from smallest to largest—regardless of interest rate.
• Attack the smallest debt with a vengeance while making minimum payments on the rest of your debts.
• Once you pay off the smallest debt, take that payment and apply it to your next-smallest debt.
• Repeat this method as you plow your way through debt—which usually takes most people between 18–24 months.

This will take work, but it's definitely worth it in the end. Think about what your life will be like when you don't have to spend big chunks of your paycheck paying off things you bought months (or years) ago. Don't give up!

Now that we’ve covered how to start paying off debt, here are 28 ways to help you get out of debt faster. Finish line, here we come!

Dave Ramsey’s Basic Tips for Getting Out of Debt

1. Make a budget!

This one ranks at the top of Dave's list because it's that important. The truth is, you can’t get out of debt without making a budget. Period.

Pay off debt fast and save more money with Financial Peace University.

But budgeting doesn't have to be a daily chore you dread. You can make it easy by using budgeting apps like EveryDollar.

We recommend a zero-based budget because it’s the best way to give every dollar you make a job to do whether you’re giving it, saving it or spending it. You budget will show you where you’re spending your money and—just as important—where to cut back so you can throw more money at your debt snowball.  

2. Start a side gig.

Starting your own business has never been easier! Do you have a knack for making things? Sell your products online. Are you an animal lover? Take up dog walking or pet sitting.

Learn how to start a business on the side. You might be surprised how successful you become.

3. Get a part-time job.

Not into starting your own business? Then consider some easy ways to earn extra cash on the side. Become a driver for Lyft or Uber. Or deliver pizzas at night to bring in extra money. You can even deliver other types of food in your spare time by working for places like Uber Eats or Grubhub.

That extra money coming in every month will help you pay off your debt quickly so you can start celebrating sooner!

4. Sell the car!

The average monthly payment for a new car is $667.¹ That’s just outrageous! Think about how much faster you could get out of debt if you replaced the new, shiny toy in your garage with a used car you paid for with cash. You could throw that $667 car payment at your debt snowball every month instead of out the window.

5. Cut up your credit cards.

Shred ’em. Burn ’em. Shoot ’em. You’ll never get out of debt until you stop making debt a way of life. The credit card industry will try to tell you that closing your credit card account is a bad idea.

Listen closely: They’re wrong. No matter how many credit cards you have, all they do is keep you stuck in the cycle of debt. Get rid of every last one and never look back!

6. Use the envelope system.

When you pay with cash, you actually feel your money leaving your hands. Ouch! People tend to spend less when paying in cold, hard cash. Using your own custom envelope system, you'll see (and feel) every dollar you spend from your envelopes, and that will help you keep track of your spending so you can stick to your budget.

7. Stop investing.

Yep, you read that right. And yes, we even mean stop contributing to your 401(k). Right now, you want all of your income to go toward your plan to get out of debt.

Once you’ve paid off your debt and have saved 3–6 months of expenses in a fully funded emergency fund (which is Baby Step 3), you can start investing for retirement again. By then, you’ll be on Baby Step 4 and can start putting 15% of your income toward retirement.

8. Quit the comparison game.

You know who wins at the comparison game? No. One. Stop trying to keep up with the Joneses! Remember, you’re living like no one else now so later you can live and give like no one else.

Think about it. In 20 years, you won’t have a financial worry in the world, while everyone else will still have car loans, mortgages and credit card bills.

9. Tell the kids you’re on a budget.

When it comes to money, the kids can be a worse guide than your stomach. But instead of making them an enemy of your money goals, get them on board! Teach them about money so they understand what you do and don’t have room for in the budget. Talk to them about your vision of having a life without debt. And remember: Never be afraid to use that magic word: No.

10. Take Financial Peace University.

With Financial Peace University (FPU), you'll learn the step-by-step plan to get out of debt and save more money. You can watch the nine-lesson course on your own or join a class for added accountability. Either way, start FPU today—and learn how to become debt-free for good!

Ways to Get Out of Debt by Spending Less and Shopping Smart

11. Cut those coupons.

You’ve probably heard this a thousand times, but are you actually doing it? You can save a ton of money just by showing a coupon to the cashier.

Just be sure you’re using coupons for products you already plan on buying—otherwise you could end up overspending on items you don’t need.

12. Try consignment shopping.

Kids grow out of clothes at the speed of light. And let’s be real: It’s not worth it to go into debt for your two-year-old’s ever-changing wardrobe. Check out your local consignment stores that sell pre-loved outfits in good condition. And if you’d rather shop online, sites like thredUP and Swap.com are great resources to get adult and children’s clothing—at a fraction of the cost.

13. Cut the cable.

If you love watching TV and you also love saving money, you have options. Check out the best streaming services for your budget and cut the cord. Put that $100 cable bill toward your debt each month and watch just how quickly your debt snowball starts rolling.

14. Stop going out to eat.

We get it. Going to a restaurant or hitting up the drive-thru is so much easier than making meals at home. But while you’re enjoying the freedom of not having to cook for those picky eaters, you’re spending way more money by eating out than you would by eating in.

Here’s an idea: Invite friends over for taco night instead of meeting up at a restaurant. And hey—if you want to splurge for guac, we won’t judge.

15. Meal plan.

Okay, practically speaking, if you take restaurants off the table, how can you do this “meals at home” thing without stressing out? Start meal planning! You’ll cut back on the amount of money you spend on food each month. That means more of your hard-earned income can go toward paying off your debt.

16. Break up with your barista.

If you don’t know where all your money’s going each month, we’re pretty sure your favorite coffee shop can find it for you. Try brewing your own coffee at home. It’s a minor adjustment to your morning routine and can really add to your savings fast.

17. Visit the library.

Libraries have been around forever, but guess what? They're still awesome! You can check out any book, e-book or audiobook anytime for free.

Plus, the internet has made the benefits of libraries even better. Library apps like Libby, Hoopla, and Project Gutenberg let you search, reserve and check out books without ever leaving the couch!

18. Make a grocery shopping list.

Want to hear one of the easiest ways to save money at the grocery store? Make a list. Whether you like to write down your grocery needs on a piece of paper or you prefer using a grocery list app like Mealime or AnyList, don’t walk through those automatic doors without this written plan of attack.

But here’s the thing about making a list: You have to stick to it. Especially if you're shopping with kids. It's a whole lot easier to blow your budget when your kid sees a 40% off sign on a giant Nerf gun on Aisle 11, looks at you with pleading eyes, and says that’s the exact one he’s been wanting.

19. Try grocery shopping online.

Of course, convenience is top of mind whenever you think about the benefits of online vs. in-store grocery shopping. But you know what else is a major benefit? Saving money!

In addition to the “online only” deals and other perks, you get to review your cart before you click “buy now.” That means you can remove those impulse buys that looked yummy while you were browsing but aren’t actually necessary.

20. Avoid expensive hobbies.

Do you really have $200 a month to spend on golf? Or vintage bottles of wine to add to your collection? Designer fabric for that crafting project you’ve started and stopped so many times?

Put those pricey pleasures on hold for a short while—remember, your favorite craft store will still be there once you get out of debt.

21. Ditch the gym membership.

Last we heard, you can still go for a run outside—for free. Gather some friends and start a running club. Or do those fancy HIIT workouts at your local park. You can get fit and healthy without spending a ton of money. Just make sure you don’t use all that savings to buy protein powder you never finish. Instead, put the money directly toward your debt-free goal so you can get out of debt fast.

22. Find free entertainment.

Put a spending freeze on your entertainment costs for a little while. This means no going out to the movies, concerts, mini golf or whatever you do for fun that costs money.

There are cheaper ways to reward yourself than spending money to hear Taylor Swift sing in person. Instead, challenge yourself to find free ways to stay entertained. Take the kids to the park. Or look for a free event in your community. Taylor Swift isn’t going anywhere. You can get tickets once you’ve knocked out your debt.

Other Creative Ideas to Get Out of Debt

23. Ask for a raise.

What do you have to lose? Like Wayne Gretzky says, “You miss 100% of the shots you don’t take.” Learn how to ask for a raise (the right way) and then put on your confident face and march into your boss’s office.

24. Learn to say no.

Make it a new part of your vocabulary. Love it. Embrace it. Because when it comes to spending money, you’ll need to say it quite often. Learning how to say no to buying stuff you don’t need is one of the smartest ways to stop paying for your past and start building your future.

25. Sell items on Facebook Marketplace or Craigslist.

Haven’t you heard? One person’s trash is another person’s treasure. Dig through your kids’ rooms. Then search through that black hole of your closet to find things you can part with to make some quick cash.

If you'd prefer to sell your stuff the old-fashioned way, host a garage sale.

26. Go on a spending freeze.

Challenge yourself with a no-spending day or a “nothing but the essentials” month, aka a spending freeze. This is a great way save some extra money—so you can chuck it at that month’s debt payoff goal.

27. Give more.

Wait a minute—give? Yes! Giving changes you. It changes your spirit and takes your focus off of you for a minute. Make tithing and giving part of your budget, no matter what your income is.

28. Find accountability.

Sticking to a plan so you can get out of debt is hard. When you have to say no to friends, concerts and going out to eat, it’s even harder.

That’s why it’s important to find someone you trust to hold you accountable to your goals. If you’re married, that’s your spouse. The person who holds you accountable could also be your best friend or even your neighbor. Just make sure it’s someone who will actually call you out if you slip up.

Traps to Avoid When You’re Learning How to Get Out of Debt

Okay, now that you’ve got tips on how to get your debt snowball rolling, let’s talk about some things that could trip you up along the way. Here are a few traps to avoid as you baby step your way to debt freedom:

1. Debt Consolidation

You’ve probably heard of it. And maybe you’ve even fallen prey to it. But hear us out: Debt consolidation is a bad idea.

With consolidation, combining your debts for a lower interest rate will make you feel like you’ve done something to help your situation. In reality, though, it’s only going to keep you in debt longer—because debt consolidation often means a longer repayment term.

The only form of debt consolidation we can get behind is for student loans. And that’s only if you consolidate your student loans the right way.

2. Credit Card Balance Transfers

Just like debt consolidation, credit card balance transfers will only offer you a temporary solution. Sure, it might give you a little extra breathing room in your paycheck, but it’ll keep you in debt for longer.

Why? Because you’ll be tempted to spend those “extra” dollars on something other than your debt. Remember, the only way to get out of debt fast is by throwing everything you have at it—until it’s gone.

3. Filing for Bankruptcy

When you don’t have enough money to pay the light bill or buy food, it’s beyond terrifying. But bankruptcy is rarely the answer. If you feel like bankruptcy is your only option, it’s time to slow down, take a deep breath, and remember there’s hope.

Bankruptcy is the last thing you should consider. Before you go there, do everything you can to avoid it. If you’re feeling like you have no other choice, please talk with a Ramsey Preferred Coach first. They can offer hope by walking you through other options.

Learn the Best Way to Get Out of Debt

There are a lot of things you can do to get out of debt fast. But without the right plan, it’s hard to make progress—and even harder to keep yourself from going back into debt later.

We mentioned it earlier, but it’s worth repeating: With Financial Peace University (FPU), you’ll learn the proven plan to get out of debt and stay out of debt. FPU has helped millions of people take control of their money and go after their goals with confidence. And now it’s your turn.

Listen: The road to debt freedom can be tough. But remember, your future is worth the work you put in today. You can do this!