16 Habits to Adopt if You’re Serious About Paying off Debt

office desk with get out of debt written on it
Let’s face it.
Debt is a common fact of life today.
Research shows that 8 out of 10 people are in debt.
But think about it:

What could you do with your money if you didn’t have a single debt payment in the world?
All that weight lifted off your shoulders. 
Saying goodbye to the never-ending payments. 
Enjoying your debt free lifestyle to the fullest.
You have a lot to look forward to.
But if you want to enjoy simple debt free living, then you have to do these 16 things first.
So let’s jump in.  
(This post may contain affiliate links. Check out our full disclosure policy here!)

1. The Old Way of Life Wasn’t Workingman cutting up credit card

You don’t have to be homeless to be broke. 
Broke is only being able to afford minimum payments on everything.
Broke is being in debt up to your eyeballs.
Broke is buying a brand-new car because you can “afford” the monthly payments but not having $1,000 in your emergency fund.
The first step is recognizing your old life for what it was:
When you’re debt free, you’re using today’s dollars to pay for today’s expenses. Not today’s dollars to pay for last years debt.
Changing your spending habits may seem hard at first. But your quality of life is so much richer without debt.
“Every time you borrow money, you’re robbing your future self.”
-Nathan W. Morris
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2. Create Boundaries for Yourselfwoman typing on laptop

Here’s the thing:
We’ve made it far too easy on ourselves to spend money.
We keep our credit card information auto-saved online.
We enable one-click ordering features.
We sign up for newsletters to get the latest deals sent straight to our inbox.
But here’s the bottom line:
You have to spend less or earn more. And ideally, you’d do both.
So it’s your job to figure out what your weaknesses are and draw clear lines in the sand.
For me, that meant developing a cash system because I was a little too swipe happy. 
For you, that might mean creating a budget and sticking to it.
Which brings me to the next point:

3. Start a Budgetman writing budget

We’ve all been there.
You create a budget with good intentions, only to fall off a week later.
It happens.
But if you find yourself falling off the wagon, you’ve got to pick yourself up and keep going.
You’ve got a debt free lifestyle to look forward to, remember?
Here’s the deal:
Your budget is one of your most powerful financial tools.
Without it, you’re not seeing the spending leaks that are crippling your financial life.
So take a look at the recommended budgeting percentages:
  • Housing: 25% – 30%
  • Utilities: 5% – 10%
  • Food:  10 % – 15%
  • Transportation: 10% 
  • Health: 5% -10%
  • Insurance: 10% – 25%
  • Personal: 5% – 10%
  • Saving: 10% – 15%
  • Miscellaneous: 5-10%
How do you measure up?
Make sure you aren’t way off base with one or more of these categories.
“A budget is you telling your money where to go instead of wondering where it went.”
-John Maxwell

4. Save $1,000 for an Emergency Fundjar with money in it

Sh-t happens.
That’s life, and that’s what your emergency fund is for.
Because if you don’t prepare for emergencies, you can easily get hit with – and caught up in – even more debt.
Here’s the thing:
47% of people don’t even have enough money to cover a $400 emergency.
And what happens when you don’t have the money?
You have to borrow it.
This makes debt a never ending cycle. Not good.
So protect yourself against new debt by building a safety net.
“Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.”
-Benjamin Franklin


5. Start Saving While You Spendman and woman writing on finance paper

You’ve got necessities you need to buy.
But you should save money on the things you need.
So let’s talk about a cash back program called Ebates.
You don’t like wasting money. But you also don’t always have time to clip coupons, either.
So here’s what you do:
Sign up for a free Ebates account and use the search bar to find the retailer you want to shop with.
For my visual readers, here’s what that looks like:
Ebates homepage gif
As you make purchases, you’ll earn cash back.
Ebates is an awesome way to save money on everything you buy.
Debt free lifestyle, here you come.
But fair warning:
Only buy the things you know you need. It’s easy to go overboard with the spending when you’re getting a great deal.
But the goal is to save money on things you need, not waste money on things you don’t.
Back to Ebates:
Once you accumulate $5 or more, Ebates will mail you a check or deposit your money into your PayPal.


Note: the Ebates link above gives you a $10 bonus for signing up and shopping.

6. Use the 48 Hour Ruleclock hanging on wall

“Let me think about it” is one of the best things you can say when it comes to your money.
Here’s the thing:
When you hit the pause button for 48-hours, it allows the rational side of your brain to kick in.
You start thinking of better ways to spend that money.
Like getting out of debt or contributing to savings.
Also, beware of “deals” that are only good for a set amount of time – 20 minutes, 1 hour, or even 24 hours.
Marketers are smart. They use time limits to get you locked in quickly before you have time to think about it.
What’s the bottom line?
Learn to develop this habit, and watch as you slowly take control of your financial life. 
“Too many people spend money they earned..to buy things they don’t want..to impress people that they don’t like.”
-Will Rogers

7. Live Within Your Meansman doing budget

Why is living within your means so hard to do?
The idea is simple:
Spend less than you make.
But when you factor in credit cards and loans as spending instruments, it’s easy to spend more money than you actually earn.
A car loan here, a vacation put on credit card there – and you’re left with a mess.
So create your budget. Know exactly what you have to spend each month – and spend less.
And another thing:
It may mean trading in your nice car for something more reasonable.
Or downsizing to a home that you can actually afford.
But guess what?
Working towards a debt free lifestyle means so much more than spending less than you earn.
It means managing your money instead of letting it manage you.
“Don’t tell me what you value, show me your budget, and I’ll tell you what you value.”

9. Dine Insalmon and salad

…at home.
Or like Dave Ramsey says, “Don’t step foot into a restaurant unless you’re working there.”
Eating out is expensive. At $7 a meal, if you eat out once a day, you’re spending $210/month to do so.
Is it worth it? 

10. Use Cash as Much as Possibledollar bills

When you swipe your card and get it back, it doesn’t sink in as much as handing over your hard earned dollars.
And actually, research shows that people who use cards waste 12%-18% more money than people who use cash.
Using cash creates a loss-type feeling in your mind. That feeling keeps you more accountable for your spending.
And the best part?
You can’t go into debt if you don’t borrow.
So when you take exactly how much money you need with you, you won’t overspend because you simply can’t.

11. Give Up What You Don’t Needman writing in notebook

Small expenses destroy your monthly budget.
So take a look at the budget you’ve created, and see if you can:
  • Cancel unused gym memberships.
  • Get rid of the “free” trials that are so easy to forget to cancel.
  • Cancel unnecessary subscription box services.
What’s cluttering up your financial life?
Take the time to go through your receipts and credit card statements to figure out how to trim the fat.
And avoid the tendency to call something a need when it’s really just a want. 
“Small leaks will sink a great ship.”
-Benjamin Franklin


12. Start Saving for Major Purchasescoins stacked up

The key to reaching a debt free lifestyle and staying there comes down to discipline.
Discipline is the key to taking your financial life back.
Save up for a car.
Set aside money for a down payment on a home.
Save up the money for home repairs.
Nobody looks back and says, “I saved too much money.”
So do it the right way, and you’ll be so glad you did.

13. Measure Your Debt  woman using phone and laptop

After I graduated from college, I got into the habit of calculating the cost of debt. 
It was eye-opening.
Here’s what I mean:
Figure out how much your debt costs in interest each year, then divide it by 365.
How much does your interest cost you?
$10 each day? $15? $20?
Interest rates are tricky. And they’re what ends up costing you so much in the long run.
My advice?
Try to transfer your balances to a lower-rate card.
Or, you can use a company like SoFi to lower your interest rate for you.
Just by lowering your interest rate, you’ll save thousands over the course of your loan. 
So just because you can’t afford to pay off the balance completely, don’t settle for a high APR.
(If you need more info on SoFi, you can read our SoFi review here)


Note: The Sofi link above gives you a $100 welcome bonus.

14. Find Like Minded Friendsgroup of friends fist bumping

Let’s be honest.
Not everyone is going to be on board with you.
They might not understand why you’d choose to trade in your car for something more affordable.
Or they might give you a hard time about not going out to eat.
Or worse, they see that you’re working toward a debt free lifestyle and want to borrow money from you.
Try to make friends with others who are financially responsible like you.
Find friends that will lift you up and support you in your debt free journey.
It’ll make the process a whole hell of a lot easier.
“I love money. I bought some pretty good stuff. Got me a $300 pair of socks. Got a fur sink. An electric dog polisher. A gasoline powered turtleneck sweater. And, of course, I bought some dumb stuff, too.”
-Steve Martin


15. Set Goals and Track Themgoals written on napkin

Several years ago, Harvard did a research study about goal setting.
They asked students if they had set specific, written goals, as well as if they’d made clear plans to achieve them.
Here were the results:
  • 3% had written goals and plans to achieve them
  • 13% had goals in their heads but hadn’t written them down
  • 84% had no goals at all
After 10 years, the same group of students were interviewed again. 
The results were surprising.
The 13% of the class who had goals, but didn’t write them down, earned twice the amount of the 84% who had no goals. 
And the 3% who had written goals were earning, on average, 10 times MORE than the other 97% of the class combined.
Goal setting will transform your life.
After all, the saying goes:
A goal properly set is halfway reached.
So what are you waiting for?
“The man at the top of the mountain didn’t fall there.”
-Vince Lombardi


16. Hustle couple holding pink piggy bank

John Kapetaneas, a journalist who paid off $111,000 of debt in 24 months says his secret to success was “embracing the suck.”
For John, that meant buckling down and saying yes to as many freelance projects as he could handle.
It wasn’t fun, but it worked.
“I capitalized, over the course of two years, on every opportunity I could possibly find to work,” he said.
“That meant overnight shifts, holidays, weekends — every possible shift that I could pick up as a freelancer, I took.”
And if there’s one thing being broke teaches you, it’s how to hustle.
Plasma donations, cleaning houses, babysitting, and selling stuff you don’t need – show you that earning money is sometimes about thinking outside of the box.
Now you can stop wondering what is it like to be debt free and start working towards it.
Thanks for reading.
Debt Payoff Worksheet 

Tired of feeling overwhelmed by your debt?

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1 thought on “16 Habits to Adopt if You’re Serious About Paying off Debt”

  1. Thank you. I really appreciate these suggestions and guides.

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