Is Getting Out of Debt High on Your Priority List?

If it isn’t, it should be. America is in debt up to its eyeballs. And I’m not just talking about the country, though the government is in debt also. Debt is at an all time high. And more is being added every day. Getting out of debt should be one the first goals of anyone serious about correcting their finances.

Check out this very interesting page (US National Debt Clock) that has a ton of info regarding money, debt, and revenue, both on a personal level as well as a state and federal level.

Based on those numbers, we have a debt emergency!! And if you have debt other than a mortgage, then you have a personal debt debt emergency. If it doesn’t feel like an emergency, then you haven’t been paying attention.

Your debt has enslaved you, and maybe it happened slowly over time. A little here or there. If it happens slowly enough, you may not even notice what is happening. Until one day you wake up, and realize you’re in so deep, that it feels like you could never get out.


But there is hope. You can get out of the hole you’re in! Here are three keys to getting out of debt, and more importantly, staying out of debt.

Find Your Money Why, and Discover Your Purpose.

As humans we need a goal to reach for. Without a realistic, attainable goal, you’re just aimlessly wandering around with no purpose or drive. Think about why you want to be free of debt. Do you even want to? What would motivate you to eliminate your debt once and for all?

Debt payments can suck the life out of you. If every time you get a paycheck it goes right back out the door earmarked for this debt or that debt, it can be discouraging.

Just getting out from under that burden can be ‘why’ enough.

Or your purpose could be entirely different. Maybe you need to give or fund a cause that you believe in. But if all your cash goes towards debt payments, you’ll have nothing left with which to give. You can’t help forward a great cause . . . at least by giving of your money.

Or it could be wanting to give your kids/family a great chance at life. If you can rid yourself of debt, then you could help your kids with college. And in turn, help them start their life with little to no debt. Giving them that kind of a gift means much more than the monetary value of the college education. They will be miles ahead of their peers.

Perhaps you want to simply retire with dignity. You don’t need the fancy house, car, or even vacations. But you do want to be comfortable, and be able to travel and visit family and friends. But debt payments have you trapped. You don’t want your fixed income in retirement to include debt payments.

Whatever your ‘why’, find your reason for getting out of debt. Until you have a good reason, you may make some progress. But it won’t stick. Personal finance is mostly behavior. And a lifestyle change won’t be permanent without a good, motivating ‘why’.

Create a Budget and stick with it!!

After you’ve discovered your purpose, you need a concrete plan for how you’ll accomplish your ‘getting out of debt’ goal. That starts with a budget.

You have to know what you’re spending, and on what. Without this information, you might as well be throwing money into the ocean.

Start by tracking your spending. Once you have a good idea how you spend your money you can start to plan your spending in advance. You’ll be able to see where you’re spending more than you thought. And you can cut back.

If you need help setting up a budget, check out this more detailed post.

Budgets can sometimes get a bad rap. That’s because they take work. It’s not easy to keep track of your spending, and then plan your spending for the next month. There are some great tools to help with this.

I personally use Excel for my budget. I have several categories. And my income goes at the top of the sheet. I break down each paycheck between all the categories in which I want to spend my money. And once it’s gone, it’s gone.

I also use Quicken to track my spending. It’s a manual process, as I enter each transaction into the register. But as money blogger, I like to take more of hands-on approach.

For a little less effort, you can also use Mint, Personal Capital, and even Quicken to budget and track your spending. You can even use these programs to download your transactions automatically if you like.

Whatever tool you use, the key is to setup a budget that you’ll realistically stick to. Don’t plan to spend only $10 a month on your electric bill . . . unless you’ll be on vacation the whole month. You know that just won’t happen. Make your budget realistic and practical.

getting out of debt

Increase Your Margin, and Throw that at Your Debt.

The reason behind setting up a budget, and tracking your spending is simply to create some margin in your finances. Because if you spend every cent that comes in, you’ll be stuck for the rest of your life in the never-ending cycle of debt.

There are two ways to increase your margin. It’s simple really. You can increase your income with either raises, a new job, or you could add a side hustle.

The other option is to lower your spending. There are myriad of articles on both sides of the this topic. Should you concentrate on lowering your spending (being more frugal), or instead work on increasing your income. Either one in theory will add margin that you can use to pay down your debt quicker.

And the quicker you pay off your debt, the less interest you’ll pay. Which will save you even more money.

In my opinion, you should first concentrate on reducing your spending. If you haven’t been paying attention to your finances, and they’re out of control, you likely have very low hanging fruit that you can pick to create margin instantly. You can probably think of some ridiculous expense that you can immediately eliminate.

But you can only cut so much. You still need to live, and your expenses will always be there. Once you get to this point, you can work on increasing your income.

If you have a great job with excellent income potential then start there. Work more hours if you get overtime. If you can’t increase your income at your primary job, then you might want to think about a second job. This is where a side hustle comes in.

Remember your ‘why’, and know that it’s only for a short time. The motivation that comes from your reason for getting out of debt can propel you do things that you never thought possible.

How about you? If you’ve already crushed your debt, can you think of any other keys that I missed? And if you have debt, why not start a debt payoff plan – today?

Thanks as always for reading and sharing. And feel free to leave a comment to let me know what you think.



Chris is the original Cash Dad. He's a father of 3 and a mechanical engineer by trade.


  1. Yeah, I would probably be in debt if is wasn’t for you. Thanks for making me walk the straight and narrow. I think the best thing for me is to stay out of stores all together. I suppose it is good that I like being at home. It saves us lots of money. Unless I think of the money I spend as a salary. Hmm, not a bad idea 😉
    Love you!

    • Chris Reply

      You’re welcome for the debt reduction lifestyle. ?
      You’re also severely underpaid if you think the money you spend can compensate for the things you do. We may have to raise your salary. ?

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