How to Get Out of Debt Without Filing for Bankruptcy

Many Americans live outside of their means. Whether it's keeping up with your neighbors or something unexpected, numerous people have gone outside of their budget and have plunged deep into debt. To dig out requires a lot of hard work, but after you have done so without calling a debt consolidation firm or filing for bankruptcy, you will feel like the wealthiest person in the world.

Make a list of all debts you owe using the following format, preferably in Excel: credit card, card credit number, total amount owed and minimum monthly payment. List all of the consumer debt you owe. Be honest with yourself. Be sure to include all credit card debt, student loan debt and mortgage payments.

Devise a budget. What do you bring in per month versus what you pay? You need to account for everything, and don't forget insurance payments, cable bills, daycare, minimum credit card payments and fun money. Basically, every dollar you bring in should be accounted for. If you have extra, that's great. If not, you're like many people. Look into ways to make more money. It'll be tough for awhile, but the payoff makes it so worth it.

Put the credit cards away, in a drawer or even a block of ice. Then, take your list of debts owed and order it from the smallest balance remaining to the largest. This is the order in which you will pay off debt.

Pay down smaller debts first. Paying down the smallest debt first earns you a small "win" and will entice you to pay off more. Your minimum monthly payment is already listed in the budget you made. Your goal is to put every available penny toward that one small debt, and pay the minimum on all others.

Take that money that you were applying to the first credit card or debt after that first debt is paid off and start paying that amount to your next debt. Continue this process until you are out of debt.


  • Be honest and be patient. If you want to get out of debt, it has to be your sole focus. Pay off debts in order, smallest to largest.


  • This can be extremely hard work. You may be working a normal job and then delivering pizzas or working part time online or at the mall to make this work.


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