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10 Tips On How To Pay Off Debt Fast

Do you want to pay off your debt fast and be debt free in weeks?

Living your best life is not a luxury which can be enjoyed if you are in a state of debt. Despite all your hard work and effort, all your income would be directed towards paying the monthly expenses and the loan amount with interest.  Considering this, it is essential to pay off all your obligations, as soon as you can.

The process of paying off your debt may be harder than you anticipated. In order to reap the benefits of living a debt-free life, you would have to make some changes in your routine, spending habits and the way of living. However, while the process of paying off debt is difficult, it is certainly not impossible.

No matter how much debt you owe, you can work your way to pay it off by making certain changes in your lifestyle. The process may take a year or two, but if you stay determined and calculated in your spending, you can pay off any amount. You can take the following advice into account before taking that first step to living a life that is free of debt. Remember to plan, organise and stay resilient, even when you are exhausted. By following the ensuing tips, you can quickly pay off your debt!

1. Don’t let it consume your thoughts – take care of your mental health

The first rule of paying off debt is to avoid overthinking. Living with debt is overwhelming, however, to pay it all off- as swiftly as you can, you need to be in a rational state of mind. The process will require you to make some tough and spontaneous decisions. So, avoid panicking and learn to manage your anxiety.

When you are struggling financially, your struggle can overpower your thoughts. For that reason, you will not be able to think about anything other than your fear of not being able to meet the demands of your debt collectors. However, the more you think about your fears, the more you are likely to panic, which consequently, can lead you into taking self-destructive actions.

According to the Cognitive-Behavioural Model, your thoughts, feelings and behaviours are interdependent. The more you think about something, the more likely that it is for your thought content to influence your feelings. The emotions provoked then impacts and drives your behaviour.

Considering this model, if you are obsessively thinking about not being able to pay off your debt, this will result in fearful, anxious and pessimistic thoughts. This fear would then compel you to take actions which could potentially be self-destructive. For instance, you may start believing that all your hard work is going in vain, therefore, you should quit while you’re ahead. The act of quitting would be water over hard work.

Keeping this in mind, you need to train your thoughts to be positive. Do not think, “what if I fail?’ instead, wonder, “What if I succeed?” and “What would it feel like to be debt-free?” Visualise your success in achieving your goal, and you will be able to reach it.

2. Change your spending habits – habits are key

There may be a number of reasons why you are in debt. You may owe money to your university to pay off your student loans, or you may have made an investment that didn’t pan out the way you planned. Regardless, you still need to figure out a way to return your debt without affecting your daily lifestyle.

In order to maintain this balance, you would have to make some changes to your spending routine. You can write down a list of necessities that you spend every month. This list must include every single penny you spend for your necessity, including the cost of your food, utilities and even your tv streaming service. Once this list is created, ask yourself, “Is this a necessity or can I switch to a cheaper option?” At this stage, you would need to demonstrate self-discipline to make some tough decisions.

Once the list of essential spending is complete, you can write down the amount of money that you earn in a month. This can give you an exact estimate of the total spending that you can afford, as well as the amount of money you can use to pay off your debt. Seeing these numbers out on the page will help you with staying focused and disciplined in your spending.

3. Calculate the amount of money you owe

After calculating the amount of money that you can spend, you need to make a similar list that focuses on the amount of money you need to pay back. In order to make these calculations, you can categorise the agencies or institutions to which the money is owed. Next, you can write down the monthly amount that you need to pay, along with the interest rate for each debt.

To make it easier for yourself, you can arrange the list in descending order- placing the debt with the highest interest rate at the top and the debt with the lowest interest rate at the bottom. Using this order will allow you to stay organised and keep track of all your debts.

Additionally, it would also be expedient for you to make this list on Microsoft Excel, Google Sheet or other equivalent spreadsheet software. With a software program, you can colour coordinate your different debt collectors, change the amount that needs to be paid and keep an organised schedule for payment. You can also use the computation functions to make estimates and calculations. This can save you time and effort in the long run. When it comes to your finances, maintaining an arranged and systematic order can make sure that you stay on track to avoid confusion.

4. Choose a strategy to get out of debt

In order to get out of debt, you need to formulate a clear-cut plan of the initiatives you can take. Debt strategies involve allocating different amounts of money to different debt collectors in a systematic order.

a. What is the debt snowball method?

The debt snowball method is ideal for you if you have a tendency to get demotivated easily. The snowball method works by offering you small wins that can ultimately give you the momentum you need to continue the process.

In order to apply the snowball debt method, you need to enlist your debts in ascending order. The debt with the lowest balance and interest rate should be prioritised first. For this method to be effective, you would need to pay a minimum amount to cater to all your debts, with the exception of the lowest debt.  This would allow you to allocate a larger sum of money to the smallest debt amount, while also ensuring that you consistently pay minimum payments for the other debts as well.

This strategy will ensure that your lowest debt is paid off completely first, which would allow you to focus on other debts on the list. With the snowball method, you can make your way to the highest debts after conquering smaller debts.

b. What is the debt avalanche method? 

Quite opposite to the snowball method, the debt avalanche method focuses on prioritising the debts with larger amounts and interest rates, while placing the low amount of debts at the bottom of the list. This method can work for you if you desire to get done with the heavy lifting at the initial stage of your debt-reducing journey.

Similar to the snowball method, you would still have to pay a minimal amount of money to the other debt collectors as well, in order to ensure that the transaction is still being made.

The debt avalanche method can be beneficial for you, if your lender uses a compound-interest rate. With this strategy, you can work yourself out of debt while minimising the amount of interest you pay with the debt. Additionally, as the rate of interest decreases, you can get out of debt at a quicker pace. However, the debt avalanche method can only work if you are consistent in your payments.

5. Decide on which debt to pay off first-which debt method would work for you?

Choosing which debt, you need to get rid of first is an important part of the process. You either want to liberate yourself from the debt that is the most burdensome, or you want to start off by paying off small debts and work your way to the highest debt owed.

This decision should depend entirely on your personal circumstances. If you are a person that gives up easily, and requires motivation and results, choosing the snowball strategy would work in your favour. By applying this method, you can see the outcome of your efforts at an earlier stage. As a result of these small victories, you would be able to stay determined in your mission to pay off the debt of the highest amounts.

On the other hand, if you struggle with anxiety, going for the avalanche debt method (paying the debt of the highest amount first) is recommended. This strategy can help you ease your burden and deal with the stress of paying a larger sum of money at an earlier stage. Additionally, with the larger debts out of the way, the avalanche method of debt payment can allow you to gradually adjust back to your typical spending routine.

You can make this decision based on whatever you think works best for your personality. You know yourself better than anyone. Choose an option that guarantees and motivates you to stay on track of the process while also keeping your sanity intact.

6. Create a ‘zero-based budget’ – review bank outgoings, direct debits, standing orders

A zero-based budget is extremely helpful in paying off debt. As the name suggests, a zero-based budget is a financial plan, which certifies that the difference between your income and expenses equals to zero. This means that the amount of money you earn should be equal to the amount of money you give away in your living expenses as well as debt payments.

Creating a zero-based budget requires practicality. To create this plan, the first thing you need to do is to write down the total income you bring home each month. Your total income should include all the money that you make in a month. This may include your salary, freelance payments, or even investment income. Whatever the amount you earn in a month, write it down on a spreadsheet.

The next stage involves listing your monthly expenses. Your monthly expenses include all the essential items that you pay for in a month. Your rent, fuel cost, groceries, streaming service, mobile bill – all fall in this category. At this stage, you must also add a contingency amount that can only be used in cases of emergency. The contingency amount is important as it can help you deal with unexpected costs (such as a plumbing issue).  Once you have calculated the sum of your monthly expenses, you can write it down and move onto the next phase.

In the next phase of zero-based budgeting, you are required to list down your seasonal expenses. The seasonal expenses include the costs that vary from season to season. For instance, you may have to spend extra in January for your partner’s birthday, or you might have to allocate an amount to pay for Christmas presents in December. The cost of seasonal expenses should also be written down, and added to the expenses of each month, as you move forward in the budgeting process.
Following this, you can note down the total amount of debt payoff that you need to cover each month.  Once your monthly expenses are calculated, you can subtract this amount from your total income. In a zero-based budget, the difference should always be equal to zero. If there is a difference between your income and expenses, you can increase or decrease your debt payments, as required.

7. Switch to low-interest deals to save money – look into credit card and mortgage deals

If you are struggling to manage debt payoffs, research about low-interest deals available on the internet. Low-interest deals on credit cards can help you with your debts by charging you a reduced rate of interest, so the total amount does not pile up as much, as quickly. For instance, you can look into 0% credit cards. A 0% credit card allows you to make purchases without any interest- for a limited period of time. These cards typically provide a 24-36 months interest free period. However, in order to avoid more debt, you must pay off minimum payments every month and the card balance before the interest-free period expires, as the interest rate spikes up instantly after the grace period is over.

You can look for similar options when browsing at mortgage deals. When living with debt, it is always smart to go through all your options before choosing a financial plan for yourself.

8. Look for other ways to find extra money to pay off debt

If you have a large debt and low income, you may wish to get creative with your ideas for increasing the monthly income. To increase your income, you do not have to take on multiple jobs, instead, you can think of ways to multiply your money without having to put in extra time and effort.

You can bring in an additional amount of money home in the following ways:

  1. Cook at home: A large portion of your money can go to ordering food from restaurants. The cheapest way of eating, while living with debt, is to cook at home. Use money saving coupons at grocery stores, which can ultimately save money when you shop for food ingredients. You can find coupons online, which can be printed off and used at stores.
  2. Move-in with your parents or friends: You can cut down your living expenses by moving in with your parents or house sharing with friends. This way, you would not have to allocate a large amount from your monthly budget towards your rent, bills and groceries. Additionally, you can also switch to public transport or bicycle to cut the cost of fuel or car expenses. By cutting down the cost of your monthly expenses, you can dedicate a larger sum of your earnings to pay off your debt.

9. Increase your income – find a side-hustle or a part-time job

In addition to decreasing your monthly expenses, you can pay off your debt by increasing your income. The more money you earn, the larger the sum you can pay back and achieve your dream of living a debt-free life. Consider the following initiatives which can help you increase your income:

  1. Get a part-time job: A part-time job may not be an ideal choice, but it can help you pay the debt a little bit quicker. If you are working in a corporate setting, you can pick up a shift at a restaurant or bar over the weekend.
  2. Sell your unnecessary belongings: The internet has increased the opportunities to earn online. You can take advantage of platforms such as eBay, Shpock and Gumtree to sell your unwanted items. You can earn a handsome amount from selling your old clothes, bags, collectable items, and even your console games!
  3. Fill surveys to earn money: Another way to earn money, without putting in a lot of effort, is to fill in research surveys online. Typically, you can earn up to £300 per month by filling online surveys. The websites hosting these surveys pay you to provide feedback/opinions if you fit their target audience.
  4. Flip products to make a profit: If you are creative and artistic, you can make some extra cash by flipping everyday items and selling them online. You can invest in cheap products, add your own design element, and sell them at a higher price. For instance, if you have an eye for fashion and design, you can buy clothes in bulk, alter them with your own design so that they look fresh and modern. You can start up your own account on eBay and sell your creations online. The profit made through this process can be used to pay your debt.

10. Consider bankruptcy – your last resort

Despite taking all these measures, if you are still unable to pay your debt, declaring bankruptcy could be your last option. Bankruptcy provides you with an opportunity to have a new financial beginning. When you are considered bankrupt, all the debts that you can provide evidence for owing, are paid off. Additionally, if you own an asset, such as a house or a car, the asset is repossessed and is used to pay off your debt.

To declare bankruptcy, you can fill out an online application. The application would include questions about your debt, your total income, your expenses and it may also require you to submit letters that you have received from bailiffs or enforcement agents.

In England and Wales, the application for bankruptcy is reviewed by an official adjudicator, who are employed by Insolvency Service. The official adjudicator goes through your accounts and makes a decision on whether or not you should be declared bankrupt. On average, it takes about twenty-eight days to get a decision, after you have submitted the application.

However, you would still need to pay a cost, before filing the application. The fee for this process is around £680. If you are unable to afford this fee, you can work out an agreement to pay the amount in instalments.

Once you are considered bankrupt, an official Receiver would be assigned to you, within two weeks of the announcement. This individual would investigate your total income, expenses and assets, and make a decision on how the debts can be paid. The process may compel you to attend interview sessions with the official receiver. In the state of bankruptcy, you would have to adhere to the requirements of bankruptcy. In general, it takes at least one year for all your debts to be paid off.


Paying off debt is not an easy process. To survive this period of constant tests and restraints, you would have to be your own cheerleader and mentally motivate yourself to stay positive in the process. Throughout this time period, stay disciplined in your spending and create a framework that defines the way in which you can tackle the payment of all your individual debts. All in all, if you keep finding creative ways to increase your income and limit your spending, one day you will achieve a debt-free life!

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