Jun 16, 2025
Paying off debt requires a clear strategy, a disciplined budget, and smart repayment choices. At times, this might feel overwhelming. But it doesn’t have to be. With the right mindset and a few key steps, you could start heading toward financial freedom sooner than you expected—regardless of your income.
“The key is finding a method you can stick with,” said Dan Nickele, vice president of Discover® Personal Loans. “Reviewing your situation on a regular basis helps build momentum, so you can stay on the path toward financial health.”
Even if your income has changed or your budget is tight, you could still make progress toward paying off debt fast and setting yourself up for long-term financial success. Here are eight steps to help you get started.
The first step in any plan is to ensure you have a complete picture of what you owe. Review your monthly statements for credit cards, car loans, medical bills, and other debts. Then make a list for each. Here is the information you should include:
Another part of this step is to check your credit report. The information there can provide an overall snapshot of your financial situation. You can review a list of both open and closed accounts. You might find older accounts you didn’t realize were still active. If there are any errors or current balances, you’ll want to take note of them.
Once you know the scope of your debt, you can set some attainable goals and create a plan to reach them.
Debt picture in hand, your next step is to create a detailed budget to track everything you spend in a month. This lets you see exactly how much you need to pay for basic expenses. Living within your means is essential, and it’s much easier to do this when you know exactly where your money is going.
Once you have a clear picture of your monthly income and expenses, you may find areas where you can reduce spending. You might be able to cut back on optional expenses, such as streaming subscriptions, dining out, or recreational activities.
When creating your budget, guidelines such as the 50/30/20 rule might help. The idea behind strategies like this is to help you set priorities. You may then find that you have available money to pay down your debt.
Credit cards are often a useful financial tool, especially when they offer cashback rewards. Make sure you use them wisely. If possible, you’ll want to pay off the full balance each month before the due date. This helps avoid interest charges and penalties.
If that’s out of reach, be sure to pay at least the minimum amount on all your balances. And anytime you can pay more than the minimum, do it. You’ll reduce your overall credit card debt, as well as the total amount you pay in interest.
Like setting a budget, there are strategies for reducing your credit card balance or other debt. The debt avalanche method may be the most cost-effective strategy, because you pay down your most expensive debt first. With this method, after paying monthly minimum payments, any extra money in your budget would go toward the debt with the highest interest rate.
Some people prefer the snowball method, where you pay the smallest balances first. With this strategy, you may see results quickly, which might provide added motivation.
Either way, the fastest way to pay off debt is to avoid any new revolving credit and to make timely payments before your due date.
Taking advantage of automated banking features may help streamline your monthly finances. For example, setting up automatic payments for your monthly bills can help ensure that you pay on time. This may reduce the risk of late fees and additional interest charges.
Directing a portion of your paycheck into your general savings might also make it easier to stick to your budget and reach your financial goals. Not seeing that money in your checking account may help keep you from spending it on other things. You can even consider placing the funds into savings accounts that pay you more in interest than you might earn elsewhere.
It’s not always possible, but taking on additional work could generate more income that you can put toward your debt payments. You might start a side hustle, switch jobs, or find freelance or gig work.
If you need help figuring out where to start, make a list of everything you do well and enjoy. If you love animals, you might offer dog walking or pet sitting services. You might find ways to make extra money from hobbies, such as gardening or sewing. You might also be able to pick up extra work as a freelancer in data entry, marketing, or as a virtual assistant.
Consider the kind of customer who might benefit from your skills. Your personal and professional network may help you focus on potential customers, so don’t hesitate to include them in your brainstorming.
You could also think about selling items you don’t need anymore, either online or at a garage sale. If you have things you’re willing to part with, and you’re open to discount pricing, you could earn some cash without too much effort.
If you're facing the challenge of managing your debt and you're feeling overwhelmed, there's always a way forward. Taking proactive steps might lead to a brighter financial future. Here are a couple of ways you might explore to pay down your debt faster.
A personal loan for debt consolidation has a fixed interest rate and a defined repayment term, so you’ll know exactly when you’ll be debt free. A personal loan might help you pay off debt faster and save money on interest.
You might also consider transferring the balance from one credit card with a higher interest rate to a card with a lower interest rate. This could help you save money on interest. You will want to be careful to ensure that you can pay back the balance before the lower rate ends, or you could end up paying more in interest.
You’re not alone if you find it hard to talk about money. It may help to ask a close friend or family member to be your accountability partner in your debt payoff plan.
Having someone to check in with regularly may provide moral support and consistency. A friendly conversation with your accountability partner could be the boost you need to move on to your next financial goal.
Paying off debt isn’t easy. But if you stick with it, you may find that you can make a lot of progress in a short amount of time. And once you build momentum as you pay off your debts, you’re likely to find that moving toward your financial goals has become simpler and easier.
Finally, don’t forget to celebrate as you reach your goals.
If you’re interested in knowing more about how a loan for debt consolidation might help pay off your debt, we’re here to help. Our 100% U.S.-based loan specialists can walk you through our available repayment terms, so you can select the one that meets your financial goals .
“I've been a Discover customer since 2019, I love that I was able to use Discover as a personal loan to consolidate my debt into one monthly payment that is suitable for my budget,” a Discover Personal Loans customer wrote in March 2025. “I had other debt consolidation companies to choose from, but I liked that Discover attended to my needs on getting the best interest rate, so that I didn't need to look any further.”
Check out our debt consolidation calculator to see what you could save when you consolidate higher-interest debt with a loan from Discover.
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The information provided herein is for informational purposes only and is not intended to be construed as professional advice. Nothing contained in this article shall give rise to, or be construed to give rise to, any obligation or liability whatsoever on the part of Discover, a division Capital One, N.A. (Discover) or its affiliates.
