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How to Pay off Debt

Let's talk about everyone's (least) favorite topic: debt. It’s almost as exhilarating as talking about taxes, but we gotta talk about it. If you stumbled upon this page, chances are you have debt. I want to applaud you for taking the first steps of hopping on Google and clicking away to do the research. I know it sucks carrying around debt. We can make it into a moral failure sometimes. The most challenging thing is to confront the debt and you are doing that now!

If you’ve found yourself in debt, I know it can be stressful AF. But with the right strategy, you can get out of debt without sacrificing your monthly mani-pedi or morning Starbucks.

Here’s the thing: blindly throwing money at your debts isn’t going to pay them off any sooner. You have to come up with a plan and follow it. That’s why I’m here (hi!) - to talk about a specific strategy that is highly effective when paying off debt and will save you the most money in the long run. Today, we're going to talk about the avalanche method and how you can use it to pay off your debt and get on with your life.

Avalanche Method for Paying off Debt

Money is mental AF, so this strategy may not be for everyone, and that’s OKAY! But if you’re more of a math person (hello, left-brainers) and want to save the most money in the long run, the avalanche method is for you. The avalanche method focuses on paying the debt with the highest interest rates first. By doing so, you'll save the most money on interest charges.

The debt with the highest interest rate may have the smallest or biggest balance, or maybe it’s somewhere in the middle. If it has a larger balance than the others, remember to be patient as it will naturally take longer to pay off than the others.

CRITICAL NOTE: While we are focusing on the debt with the highest interest rates first, we are not abandoning the other cards. We still have to make our minimum payment on time, or we will be hit with late fees and a slew of other problems.

How Does the Debt Avalanche Method Work?

Okay, so how do you go about using this strategy?

STEP 1: Figure out how much you owe

This is the part where you grab all your debts and start adding up every last penny you owe. It might be painful, but trust me, it's necessary. You can't make a plan to pay off your debt if you don't know how much you owe in the first place.

STEP 2: Review each interest rate and list them out high to low

Okay, now that you know how much you owe, it's time to get real about those interest rates. This is where you want to list them all out, from highest to lowest. That way, you know which debt is costing you the most money in interest and which one you want to tackle first. Where do you find the interest rate? It should be at the top of your monthly statement called APR.

STEP3: Review each minimum payment and list them out with due dates

Double-check that the due dates align with when you get paid. If they don't, call and get the due dates changed. Yep! That’s a thing! Align them with your paydays so you never miss a payment. This step might seem tedious, but trust me, it's worth it. You want to ensure you're not missing any payments and not paying late fees unnecessarily. Plus, if you can align your due dates with your paydays, it makes budgeting a lot easier.

STEP 4: Automate all minimum payments to prevent from defaulting on any debt

Now that you know how much you owe, which debt has the highest interest rate, and when your payments are due, it's time to set up some automatic payments. This will help you stay on track and avoid any late fees or defaults.

Step 5: Put all extra money into the debt with the highest interest rate

Alright, this is the F-U-N part! Once you've paid all your minimum payments, tackling that high-interest debt is your priority. This is where you want to put all your extra money, whether it's from a side hustle or cutting back on those Lululemon matching sets and Sephora runs each month. Ideally, we want to look for those bigger ticket items when we cut back. I would never suggest you skip your daily Starbucks if that gets you through the day - keep doing it. But we gotta pick and choose what we can forgo for the time being; and the more we can scrape up without completely losing our mind, the better. Whether it’s an extra $50 or $500, put that extra cash each month into the debt with the highest interest rate. You’ll want that extra amount included in your automation (Step 4) and build that into your budget.

Example of how you would tackle three different credit cards with the debt avalanche method

STEP 6: Repeat step 5 until you are done

Repeat until it's done! Once you finish paying off your debt with the highest interest rate, move on to the debt with the next highest rate, put your extra money there, and so on.

As you pay off your debts, you’ll have more money each month to allocate to the remaining ones.

Now that you have a map don’t just randomly throw money at each of them throughout the month—that’s what most people do. They never see any progress, which is really defeating. 

Benefits of the Debt Avalanche Method

Let's go over a few of them:

  1. You'll save money in the long run. You'll pay less interest over time by paying off your highest-interest debt first. This means you'll have more money in your pocket (to spend, save, or invest) in the long run.

  2. You'll feel a sense of accomplishment. Tackling debt can feel overwhelming, but by using the avalanche method, your progress suddenly catches up quickly (ya know, like an avalanche). This can help you stay motivated and feel a sense of accomplishment as you pay off each debt.

  3. You'll reduce stress. Let's face it, debt can be stressful. By having a plan to pay it off, you'll feel more in control of your finances and reduce stress and anxiety.

  4. You'll be able to focus on your other financial goals. Once you've paid off your debt, you'll have more money to put towards other financial goals, like saving for retirement or a down payment on a house.


If this method isn’t for you, no sweat! There are other strategies you can use. Check them out here.

Remember to give yourself grace. Reflect on how you got here and what you can do to stop it from happening again. And most importantly, remember that your net worth your self-worth 💕

Looking for more information about debt and credit? With my online self-paced Debt and Credit course, you can confront your debt head-on and create a foolproof plan to pay it all off while still living the life you love.