7 Habits That Will Help You Pay Off Debt

Struggling to pay off your debt? Adopt these helpful habits

 A lot of people will tell you that in order to pay off debt, you need to make it your singular focus.

“Throw all of your extra money toward your debt,” they’ll say. “You’ll have to make sacrifices in the meantime, but it will be worth it.”

Try telling that to someone (possibly you) that has over six figures of debt in their name — excluding their mortgage.

That’s a long journey. Is it realistic to assume everyone can easily give up the “unnecessary” things in their life for five to 10 years while they pay off that debt?

Worse, is it realistic to assume that they should essentially put their life plans on hold for that long?

Probably not.

Some people can sprint to the debt payoff finish line, but most people benefit from taking a slightly easier route. That’s what we’ll cover here because paying off debt shouldn’t feel like a prison sentence.

Here are seven success habits you can develop to pay off your debt without making crazy sacrifices.

Budget for Debt Payments

Writing a budget

The number one mistake a lot of people make when trying to pay off their debt is not budgeting for their monthly payments. It’s a bill, but it’s not exactly in the same league as your utility bill, so you may not treat it as such.

You should! It’s due every month and you face negative consequences for not paying it on time. And if you want to pay extra toward your debt, it helps to have that money accounted for in your budget.

The easiest way to start is to use a zero-sum budgeting approach because this forces you to give every single dollar that you earn a “job.” So if you make $3,000 per month, you need to figure out where it’s all going.

Take a look at your current budget and see if you typically have any money left at the end of the month. If you don’t, you might want to rework your budget (or use an easier method where you pay yourself first), and if you do, then you should figure out what you’ve been doing with it.

Including your debt payments in your budget means you don’t have to magically come up with the money every month, and with that confidence, you might benefit from enrolling in auto-payments so you don’t need to worry about missing one.

Think of It As a Marathon, Not a Sprint

Person running in the sunset

Approaching your debt with a sprint mindset is one of the easiest ways to cause debt fatigue. While some debt can be classified as an “emergency,” especially if it holds a double-digit interest rate, in general, it’s better to take a less frantic approach to debt.

First, going all out on your debt can be draining — emotionally and physically (which we’ll talk about below). If you have a large sum of debt to pay off, this pace may not be sustainable for you.

Second, some people prefer to take their time paying off their low-interest debt because they believe they can get a better return elsewhere. While that may be true, if you’re using this argument, make sure you’re actually doing something with your money. It’s not going to get a better return sitting in the bank because your return when paying off debt is your interest rate.

Finally, life is meant to be enjoyed. Most people regret being in debt — they don’t want to focus on it because it upsets them. By making it your sole focus, you might fall into the habit of letting your debt consume you.

“Sorry, I can’t go out because all of my money is tied up in debt payments.”

“I really wish I could go on that trip, but I’m in debt.”

“Sweet, I just found $50! Oh wait, that should probably go toward my debt…”

If you follow the all-or-nothing approach, you can see very quickly that your life begins to revolve around your debt. Don’t let it make decisions for you. You can do things despite your debt, so long as you go about it in a financially responsible way — i.e. having a separate entertainment savings fund, saving for a trip, or having some fun money.

Along those same lines, don't make any rash decisions like raiding your 401(k) to pay off your debt.

Don't Put Your Health in Jeopardy

Woman looking down
Getty Images 

Other common advice for paying off debt includes earning more. If you can’t afford to pay extra right now, get a side hustle, work extra hours or get a seasonal job.

While this advice is practical and helpful in many cases, you run the risk of — again — letting debt take over.

Imagine that you’re so completely focused on becoming debt-free that you sacrifice every hour outside your regular job to earning more money. You establish a side hustle, you work 80+ hour weeks, and you’re able to aggressively pay off your debt.

Every time a money-making opportunity comes your way, you say “yes!” without thinking twice.

Until you start to feel rundown. Like you’re out of fuel. And like you can’t even remember what it’s like to have a life.

This is an extreme example, but that doesn’t mean it’s not a reality for some people. Becoming a workaholic basically becomes a habit. You can’t say no to more money, and you don’t know how to stop.

Worse yet, your sanity is suffering, and the quality of your work at both your day job and side hustle suffers. You no longer find juggling both enjoyable. Your side hustle has become a chore; a means to a debt-free end.

Don’t let this happen to you. If you choose to work more because you’d like to earn more to pay off your debt faster, go into it with boundaries. Don’t let clients (potential or otherwise) dictate your schedule.

Most of all, don’t ever skimp on your health. Medical costs might not be fun to deal with, and it might be the last thing you need when you’re buried under debt, but you should never skip a doctor’s appointment because you don’t want to pay for the visit. Health issues that you ignore now could come back worse later.

So get into the habit of prioritizing your health — both mental and physical. There’s nothing more valuable than living a fulfilling life. It’s not worth working yourself to death only to be debt-free and unable to enjoy it.

Learn From Others

Learn from others who have paid off debt

If you find you’re lacking some inspiration or need a different outlook on debt, read the stories from others who are going through something similar.

Many times, being in debt feels isolating. You might feel like you did something wrong, like you deserve to be miserable and wallowing in self-pity. But reading other people’s stories can help reframe the issue.

The truth is you’re not alone, and finding a helpful, supportive community can make a world of difference in your debt payoff journey, especially when you feel like you can’t tell anyone you know “in real life.”

Connect with like-minded people so you can bounce ideas off of them, confide in them and possibly gain an accountability partner. Surrounding yourself with people who know exactly what you’re going through might also make you feel better about your situation.

Make it a habit to reach out to others and discover different perspectives on debt payoff so the journey doesn’t get stale.

Remember Your "Why"

Woman hiking in the mountains

No one really likes being in debt. It’s just a fact of life for most people. But you’re different. You want to become debt free and live life on your terms.

Why are you different? What makes you want to accomplish this goal when most people blindly accept that being in debt is normal?

Think about why you started this journey toward debt freedom, and write it down. Then repeat it whenever you have a rough day. Maybe you feel like you’ll never get out of debt, like you’re doing this for nothing. Maybe you feel like splurging on something because you’re tired of paying your debtors.

Find your “why” again —  your big reason for doing this in the first place. You’ll likely find renewed inspiration just from reading it. Having a “why” for any big goal in life can help you overcome the many challenges you’ll face to get there.

Stay Consistent, But Forgive Yourself When Plans Fail

Stay consistent when paying off debt

One of the best things you can do to succeed at paying off your debt is to make a plan. If you don’t have a strategy for paying off debt, you’re not going to make as much progress as you would if you had a roadmap to follow.

You can choose to pay a debt off using the avalanche or snowball method (or combine the two), but give yourself a buffer if things don’t go as planned.

Why? Because life will happen. It’s Murphy’s Law. You might have an unexpected expense you have to deal with one month which causes you to only make the minimum payment on your debt. That’s fine. Having a plan matters, but you don’t need to follow it to a tee 365 days of the year.

Establish an Emergency Fund

Keep an emergency fund when paying off debt

This is also why having an emergency fund comes in handy.

Having extra funds set aside means you have less of a chance of ending up in more debt than you started with. Think about it — what if your car broke down, or you had to go to the hospital, or your pet needed special treatment?

While many of these expenses should be anticipated, the truth is, most people don’t think about them until it’s too late.

Two — you also get into the habit of saving, which might sound strange to those who follow the “put all your money toward debt!” mantra. You don’t need a gigantic emergency fund, but setting aside (and budgeting for) savings can help you become debt-free with less bumps in the road, and it also helps you stay debt-free.

Habits Make Paying off Debt Easy

Forming these simple habits and mindsets will lead to debt freedom sooner rather than later. You don't have to drive yourself crazy by putting every penny you own toward your debt. You just need to have a plan to reach the destination — one that works for you, not against you.