How to Get Out of Debt: A Step-by-Step Plan

List every debt, stop adding to it, pick a payoff order, and find extra money each month. A practical plan with a worked example, plus when to get outside help.

By CreditCardDebt Staff3 min read

Getting out of debt comes down to four moves: see exactly what you owe, stop the balance from growing, pick an order to pay things off, and find extra money to throw at it every month. The plan doesn’t need to be clever. It needs to be clear enough that you can follow it for a year or two.

1. List everything

Make a simple table of every debt: credit cards, store cards, personal loans, car loans, medical bills, money owed to family. For each, write:

the balance
the interest rate (APR)
the minimum payment
the due date

It’s often uncomfortable to see it all in one place. It’s also the moment the problem becomes something you can actually plan around.

2. Stop the bleeding

You can’t fill a bucket with a hole in it. While you’re paying debt down:

Take the cards out of your wallet and phone wallets. Delete saved card numbers from shopping sites.
Build a small emergency cushion so surprises don’t go on a card. Emergency Savings or Extra Debt Payments explains how much and in what order.
Make a basic budget so you know how much you can put toward debt each month. Creating a Personalized Budget walks through it.

3. Choose a payoff order

Pay the minimum on everything, then put every extra dollar toward one debt at a time. There are two popular ways to choose which:

Avalanche: highest interest rate first. This saves the most money.
Snowball: smallest balance first. You see debts disappear sooner, which keeps many people motivated.

Here’s how they compare for someone paying $500 a month toward three cards:

Debt	Balance	APR	Minimum
Store card	$900	30%	$35
Card A	$4,200	24%	$105
Card B	$2,400	19%	$60

Both methods clear all three cards in about 18 months. The avalanche costs about $1,340 in interest; the snowball about $1,430. The snowball knocks out Card B by month 10 instead of month 18. A difference of roughly $100 is small, so pick the method you’re more likely to stick with. When a debt is paid off, roll its whole payment into the next one.

4. Lower the interest

The less interest you pay, the faster the balance falls.

Ask for a lower rate. One phone call can work, especially if you’ve paid on time. See How to Negotiate a Lower Credit Card Interest Rate.
Balance transfer. A 0% card can stop interest for a year or more, at the cost of a 3%–5% fee. See Is a 0% Balance Transfer Worth It?
Consolidation loan. Personal loans at banks averaged under 12% in mid-2026, about half the typical card rate, though your rate depends on your credit. See Pros and Cons of Debt Consolidation Loans.

5. Find extra money

Small amounts add up when they go to the same place every month.

Cancel subscriptions you don’t use, and call your phone, internet and insurance providers to ask for a better rate.
Sell things you no longer need.
Pick up extra hours or a short-term side gig, and send all of it to the debt.
Put windfalls, such as tax refunds, bonuses, and gifts, toward the current target debt.

When to get help

If the minimums alone are more than you can pay, or you’ve been at it for months without the balances moving, get outside help. A reputable nonprofit credit counselor will review your whole budget for free or a small fee and may suggest a debt management plan, which can lower your interest rates and roll your payments into one. Plans often run four years or more.

Be careful who you choose. The FTC warns against any company that wants payment before it has done anything, or that claims it can remove accurate negative information from your credit report. Understanding Debt Relief Options compares counseling, settlement, and bankruptcy.

Keep going

Track your total balance once a month and watch it fall. Getting the first debt to zero takes the longest; after that, each payment grows and the rest go faster.

Sources

This article is for educational purposes and is not financial advice.