“The art of living does not consist in preserving and clinging to a particular mood of happiness, but in allowing happiness to change its form without being disappointed by the change, for happiness, like a child, must be allowed to grow up.”
— Charles L. Morgan
This quote perfectly captures the mindset required to break free from debt and embrace a healthier financial future. Change can be tough, but it’s necessary for growth.
How to Get Out of Debt and Stay Out
Debt is like quicksand, in that it’s easy to step into but hard to escape. Maybe you’ve only got a little, just a small monthly payment you barely notice. Or maybe it’s a mountain of bills that feels like it’s closing in on you. Either way, ignoring it won’t make it go away. If anything, it’ll just get worse, tightening its grip on your finances and your peace of mind.
The truth is, financial freedom isn’t guaranteed. It’s earned. It takes a plan, some hard choices, and a lot of persistence. But if you’re already feeling the pressure, that’s a good thing. It means you’re awake to the problem and ready to make a change.
Changes
A decade ago, I was $44,000 in credit card debt, living in a single-room apartment, and driving a car with monthly payments I couldn’t afford. I was stressed, frustrated, and constantly worried about money.
I didn’t really understand personal finance or the basics of managing my cash flow. It wasn’t until I had a Matt’s dad moment—realizing that maybe I’m the problem—that I finally decided to make a change. That shift changed everything. If you’re new to the idea of financial discipline, you’re in the right place.
Today, life is good. I got out of debt, built a better financial future, and even went back to school to earn a Financial Education Certificate. Now, I’m sharing what I’ve learned so you can do the same.
The Big Problem: You’re in Debt
You’re not alone. According to Yahoo Finance, most people in America are in debt. It’s a national crisis—and it’s costing you more than just interest payments. It’s costing you peace of mind, financial freedom, and the life you actually want to live.
The Hard Truth
Debt doesn’t just go away on its own. It grows. It compounds. It gets worse if you ignore it. But the good news? You have the power to change this.
Why Getting Out of Debt is Worth It
Getting out of debt isn’t just about money. It’s about peace of mind and freedom, and it’s about knowing that your hard-earned dollars are working for you, not for a credit card company. It’s about living life on your terms, without the constant anxiety of monthly payments hanging over your head.
Problem #1: You Don’t Know Where Your Money Goes
The Fix: Start with a Budget
If you don’t know where your money is going, you’ll never get out of debt. A budget is the first and most critical step to taking control of your finances. It’s the difference between making progress and spinning your wheels.
Start by tracking every dollar you spend. Use a simple notebook, a spreadsheet, or a budget planner like the Matt’s Dad Budget Planner. You might be surprised at where your money is leaking out. Having a structured approach to your spending can make a world of difference..
Need a guide? Check out our post on Why Budgeting Matters. Or, if you just want to get the ball rolling without overthinking it, start with some context from the 50/30/20 rule, a straightforward approach to organizing your cash flow.
Problem #2: High-Interest Debt is Eating You Alive
The Fix: Use the Debt Avalanche or Snowball Method
High-interest debt is a killer. It’s like trying to fill a bucket with a hole in the bottom. The interest keeps draining your progress, no matter how hard you work to pay it down.
Two popular methods can help you break free and get out of debt:
- Debt Avalanche Method: Focus on paying off the debt with the highest interest rate first. This approach saves you the most money in the long run because it targets the most expensive debt first. It’s the most mathematically efficient way to become debt-free, but it requires discipline, since it might take a while to pay off that first big chunk. If you have the patience and a strong will to reduce your interest costs, this is your path.
- Debt Snowball Method: Pay off your smallest debts first to build momentum and stay motivated. The psychological boost of eliminating a debt quickly can keep you going. This method might cost a bit more in interest overall, but it’s incredibly motivating. If you need small wins to stay on track, this is the way to go. It’s like the financial equivalent of eating dessert first—it just feels better.
Other Fixes
- Debt Consolidation: If you have multiple high-interest debts, consider consolidating them into a single loan with a lower interest rate. This can simplify your payments and potentially save you money in the long term. Just be careful not to run up new balances once you’ve consolidated, or you’ll be right back where you started—only now you’ll have a personal loan to deal with too. Note: Debt consolidation can come with added fees, extended repayment terms, and the temptation to run up new balances. Make sure you fully understand the long-term impact before taking this step.
- Balance Transfers: If your credit is still decent, consider moving high-interest balances to a card with a 0% introductory APR. Just make sure you can pay it off before the rate jumps back up, or you could end up in a worse spot than before. Think of it as a get out of jail free card—but only if you play it right. Note: Be aware that balance transfers often come with fees, and transferring your debt doesn’t eliminate it. You’re just moving it around. Make sure you have a realistic plan to pay it off before the promotional period ends.
Final Thoughts
Debt doesn’t have to control your life. You can take back control, build a better financial future, and break free from the cycle of stress and worry. I know it’s possible because I did it, and I even went back to school to earn a Financial Education Certificate to make sure I had the knowledge to stay on track.
Ready to make a real change? Start today with the Matt’s Dad Budget Planner and take the first step toward financial freedom. Or, start smaller with our free tools and budgets downloads. Your future self will thank you.
