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What is the Best Way to Pay Off Debt

This subject may seem a little off topic for this website but like many, we too had a debt to deal with over the years.

The reason we are bringing it up today is that many of our readers actually questioned us about what is the best way to pay off debt.

The best way to pay of debt

Wanting to know how to pay off debt fast practically always comes up during our online discussions. They have signed up to various online business schemes over the years only to get deeper in debt.

I tell them how we wanted to get out of debt by saving on our expenses is one of the main reasons we wanted to work from home.

So we wanted to share our experiences and the journey we took to get out of debt. We are not experts when it comes to financial advice but I think our experiences may help others.

You will learn how we got in debt, how we took control of our debt, how we paid it off and how we plan to stay out of debt.  

How We Get In Debt

Now I'm not going to share and bore you with all of our financial details with spreadsheets and such but I will describe events and habits that got us into debt.

Obviously, everyone will have different reasons for getting into debt but it all really comes down to one simple rule on how people get into debt.

Of course, that is that we spend more than we make.

Yes...I know...duh Paul, I don't need you to describe the obvious.

Actually, I do, as I feel people in debt go through similar steps of denial and acceptance as gamblers or alcoholics do.

I believe that many people in debt, like ourselves, go through a denial stage. We keep buying even though we know we haven't paid off the things we bought the month before and yet we still make the same amount of money per month. Then we buy more the following month and so on, and so on.

We turn a blind eye to the amount of interest we pay per month and convince ourselves we deserve these things by thinking, we only live once, life is short so enjoy it now while we can.

This type of process will last a different amount of time for everyone but we all have a breaking point.

That breaking point may be a time when you realize on your own that you need to act or it may be a time that a financial institution tells you need to act now or else!

We were fortunate enough to come to the realization on our own that we were getting into financial trouble, we knew we had to act now or else. 

It was a difficult decision to admit to ourselves that we need to take action. The habits of spending were engraved deep in our daily routine but we had no choice but to take control of our debt there and then.

Take Control of Your Debt

So how does one take control of their debt? I mean, I think we are all experts on how to get into debt but how to take control.

Well, the same rule needs to be said, you need to spend less money than you make.

Now, this is where it gets tricky, where you need to sit down and go over your budget.

Sounds easy right. You sit down to write down the amount of money that you make every month and then subtract how much you spend.

If you are in debt you will expect to see that you spend more than you make...right?

Well, the weird thing is that we were not spending more than we make...what?

Well...I should say we lied to ourselves with the numbers we put down to convince ourselves that we were not as negligent in our financial responsibilities.

That step took a few retakes to get to the point where we're finally honest with ourselves about our spending.

Oh, ya...there it was we were spending way more than we were making.

Now we were ready to do what it takes to learn how to pay off debt fast!

How to Pay Off Debt Quickly

Now we were ready to become debt free. Although it was a harsh reality we were relieved to know we were now being honest with ourselves and we were ready to do what it takes to get out of this debt.

So we started by cutting out all non-essentials.

The first biggest costs were related to food, that is where we were wasting way too much food and eating out too often.

We started by making grocery lists based on daily menus. That way we were able to keep better track of what we needed to buy, how much it would cost and with much less waste.

We decided to cut eating out in restaurants for 2 months then limit it to a strict monthly budget.

Other things we cut out included any non-essential monthly subscriptions like cable, magazines, and mobile phones (this was before the internet and cell phones were commonplace).

We traded in our van and bought a small economy car even though we were starting a new family. We realized we can still get from point A to point B with a small car just as well as a nice big van...maybe not as comfortable.

We still had to pay towards this car but the monthly payment was about half and it was much cheaper on gas and insurance.

Now that we cut out non-essential monthly services and fees we now needed to deal with all the interest we were paying on credit cards and line of credit.

This is where we needed to visit our financial institutions to discuss options and changes in rates.

We opted to remortgage our home. We had to pay a penalty to remortgage as it was not at term but we calculated that the cost of the penalty was much less than the amount of interest we would have to pay if tried to pay off our credit card debts month by month.

Remortgaging was also the fastest way to paying off our credit card debt while paying a much lower interest rate as it was within our mortgage.

The only downfall is that it will now take us much longer to pay off our house. At least our house was increasing in value so this decision was easier to swallow.

Now that we got rid of all our credit card, line of credit and car payment debt we could sleep so much better.

It was such a relief being free of debt. We never wanted to be in that situation again so we needed to take action there and then to not get into bad habits again.

We needed to come up with a plan to stay out of debt.

Staying Out of Debt

The first thing we did was decrease our credit card limits, cut way, way room for compulsive shopping.

We didn't cut up our credit cards. We knew that they were important to have a strong credit ranking for when it comes to getting the best interest rates when it came time to remortgage at term.

We realized our biggest cost savings came from controlling our spending on food and vehicles.

If we can continue to budget our food purchases and avoid buying a new car when spring rolls around we can manage to keep our finances in check.

Another way we stay out of debt is that we continue to find ways to earn extra money on the side of our regular career jobs.

We have managed small businesses on the side, some very successful with businesses such as retail merchandising, some not so successful as trying out MLMs, and some others are a work in progress with a slower but continuous growth like affiliate marketing.

It has been over 18 years ago since we got out of debt and now we are in a completely opposite situation where we are saving and investing extra money, and that invested money is earning more money.


Getting in debt is nothing to be ashamed of. So many people, if not all will be in debt at some point in their lifetime.

One should only be ashamed if they don't accept or take responsibility for their debt.

If you are in debt it is important to understand how you got into debt.

Only then you can take control of your debt, figure out how to get out of your debt situation and then know how not to get back in debt again.

We were fortunate that we had a home in our name where we had room to remortgage on our home equity. This may not be your situation and may need to look at other options such as getting a consolidation loan.

I've provided some other resources below that may be helpful and more relevant to your situation.

About the Author Paul

My online journey started in 2008 when I was tired of working for somebody else. I searched the internet for years trying to find out how to make a living from home with an online business. In 2015 I finally found the information and support from a website just like this one.

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  • Awesome post on how to get out of debt! Very helpful, as many do not even know where to start when they find themselves in this situation. Great tips.

    • Paul says:

      It’s not something most people want to own up to but the longer you wait the harder it gets to take control of your debt and finances. Thanks for visiting. Cheers Paul

  • Michael says:

    Good read! Coming from someone who has had their share of debt, there was some really valuable information in there. Great stuff!

    • Paul says:

      I was really surprised to see how many people that read my blogs were having issues with their debt. I guess it is one of the reasons turn to the internet to find different ways to make an extra income. As I explained I am certainly no expert but know that our current financial situation is so much healthier and never want to go into debt again.

  • Chrissie says:

    This is a really helpful post for anyone who sadly finds themselves in debt.
    You give them really good advice from the point of view of someone who has been in that very same place and has managed to get themselves out of it – you give them hope.
    Many thanks
    Chrissie 🙂

    • Paul says:

      Thanks, Chrissie,
      I think it is important that people in debt know that there are ways to get out of it. There is no use in burying your head and go even deeper. There is help out there for every situation. Anyone interested can use the links provided on this page to do it online or work with a local organization that can help you with extensive debt reduction. They can use Accredited Debt Relief to start feeling that relief today.

  • Maureen says:

    Hey Paul Great advice I especially like your suggestion about grocery lists. I never leave the house now without a list. I have a list on the side of the fridge and when we run out of something I write it on the list. It is so easy to overspend in a grocery store so I try and buy just what we need. Also we leave in the country so the grocery store is not just around the corner. So instead of making numerous trips we can do it in one so we are saving on gas also.

    • Paul says:

      That is great that you are using a grocery list and adding items as you run out. It definitely helps to avoid that compulsive buying tendency we all have…and never buy anything on those shelves near the cash either 😉 We tried to go one step further and reviewed a weekly menu for our meals and bought only ingredients for those planned weekly menu items. It really worked at cutting down our grocery cost and reduced waste. The only problem was taking the time to prepare the menus and ingredients. Then there were all the unplanned events that came into play that ended up mixing up the days we were going to prepare a planned meal. So now we still do a list, stay on the outer perimeter of the grocery store, only to jot into an aisle for occasional specific items. This not only helps you to save money but it tends to help you stay away from all that unhealthy processed foods.

  • Howard says:

    Hello Paul,

    Great post. As Americans, we see ourselves getting deeper and deeper into debt. We fail to take control of out financial situation, yet we blame others.

    The late Jim Rohn said: “Nothing will change unless YOU change”. That is one of the most powerful statements I’ve read in a long time. It’s too simple for many people, so they’ll fail to understand it’s meaning.

    Getting out of financial debt starts with changing your mindset, the way you think, and the way you view your situation.

    Great post!

    • Paul says:

      Yes, I too believe it is a mindset where many are also scared to admit it to themselves or others due to the stigma of embarrassment. I like the quote you added from Jim Rohn as it all does come down to YOU to make a change. Only you can take the action to make a change in your life. We can’t expect someone to come along and fix it all for you.

  • Gnekoda says:

    Hello Paul,

    First, you have such a great post about recognize your own debt-> be honest and brave to write down all the details of expenses-> thinking and considering -> take the actions to managing the debt-> you found the way to pay off the debt-> and last suggestion to avoid get back in old track, in old debt circle.

    Second, I would like to share more with you about how to control your debt with one technique that I have learn in 2015 with World Financial Group. It calls “rolling the debt”. Basic, the technique “rolling the debt” has three stages, and those stages are similar to you, but the way to do action is approaching the issue with different way. Starting with sit down-> write down all expenses and earning-> be honest with all expenses-> indicate those non-essential expenses-> now it’s managing stage-> “rolling the debt” technique takes place.

    For example, one person have debt 1: still have 12 monthly payments more to pay off the newest iphone X. Debt 2: that person has 24 monthly payments for financing the furniture value. Debt 3: about 18 monthly payment for the car. And last Debt 4 is the house.

    So, the technique rolling debt is:
    – skimming all the small non-essential expenses such as daily Starbucks coffee in every single morning, bought clothes with middle and high brand name, daily snack,etc…
    – working in the mind set for eliminate and temporary cut off those small non-essential expenses
    – do actions let’s say stop buying Starbucks coffee in every single morning and stop eating daily snack-> replace by go to Costco to buy whole sale or completely cut off expenses for saving some smart money.
    – now, we will see we have small extra money after cut off let’s say $10 dollar after save on Starbuck by go to Costco whole sale and snack. $10 for one day-> in 30 days, it would be $300 extra money.
    – Use this $300 extra money to add on the 1st debt which is iphone X. Maybe $300 extra money from first month saving doesn’t enough-> then should take extra second month saving?-> after 2 months of saving, we would have $600 extra saving money,right? -> Use this $600 to add to the Iphone X debt. $600 is nearly the half price of the Iphone X value plus all the previous monthly payments before?-> do you think we would pay off that Iphone X within 3 months or maybe 4 months for sure?-> Debt 1: done-> free with debt 1.
    – After we are free with debt 1, same concept. We have $300 saving money from cut off non-essential expense PLUS the monthly payment for Iphone X above-> we would have about $320 – $350 -> use the average $ 335 to add on the 2nd debt which is about furniture. Within 6 months plus, would you pay off the second debt with this technique?
    – And then just do the same with debt 3 and debt 4 and so on, continue the rolling until you are all free from debts.

    This technique doesn’t required you to do side-jobs, but using this rolling debt technique plus doing side-jobs If you want-> just set you free of debt quicker.

    P/S: you might find the similar concept and idea about this “rolling debt technique” on other website-> It might be me because I did share this technique in one place before this site. And the original technique, idea derives from World Financial Group. I left World Financial Group, but what I have learn is my knowledge, right?
    Thank you for reading.

    • Paul says:

      That is another fantastic way to pay off debt without having to use or approach a financial institution or an accredited debt relief service. Rolling the debt makes absolutely perfect sense. Another angle would be to see which one of those debts have the higher interest rates and figure out which way would save the most money. Sometimes it would be more beneficial to pay off the higher amount debt with the higher interest than it is to pay off the smaller debt that may have a lower interest but all depends on the amounts…calculations would need to be done. Which brings us back to the recognition of debt and then taking action. I greatly appreciate your input and experience and look forward to seeing more feedback from others in order to help others.

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