Climbing Out of a Debtor’s Rut: Try It Yourself

Third Time Wife, Wedding Planning

Triumphant bride standing on solid ground

Who else is ready to get out of debt?

To do this, you’ll need to know a few things about each of your debt accounts: current balance, interest rate and the current minimum payment.


  • Step 1: Put them in order, highest balance to lowest.
  • Step 2: Look at your budget for the month (make one if this isn’t something you already do) and figure out how much you can spare, in addition to your minimum payments listed above, towards paying off your debt.
  • Step 3: Add that additional amount to your lowest credit card, etc. each month. So if your lowest card has a minimum payment of $15 and you decided you can spare $20 more towards paying off your debt each month, you’d pay $35 towards that bill each month until it’s paid off.
  • Step 4: When you pay off the first card, roll that total payment into the next lowest bill. If, say, your next lowest bill has a minimum payment of $25, rolling that $35 that you no longer owe to Company A means you’re now payment Company B $60 a month and you haven’t affected your monthly budget at all.
  • Step 5: Repeat steps 3 and 4 until all your debts are paid.

It might seem slow going at first, especially if you’re stretched kinda thin to begin with and can’t afford a lot extra towards your debt, but after you get a couple of small balances paid off you’ll start to see dramatic results.

At least I think they’re kind of dramatic. I’m a numbers girl, after all, but seeing that balance start to go down chunk by chunk instead of pebble by pebble is a pretty cool feeling.

To see just how this will affect your own personal finance, I’ve put together a little spreadsheet you can download, plug-in your info and see the difference a little strategy can make.

CC Payoff Projector (just right click and save as to download a copy)

This isn’t, of course, exact, but it’ll give you a good idea of what to expect.

And depending on the card and the balance, you may need to update your plan from time to time.

A couple things to remember, though, to make this work the best:

  • Once you start to pay off a card, don’t use it! I know, it’s kind of obvious, but it’s worth saying that any charges made against it means longer to pay it off.
  • If the interest rate changes (an unfortunate reality, I’m afraid) make sure to update your spreadsheet so you can see what it’ll do to your pay-off plans. If it skyrockets, maybe call the company and ask for a rate review.

Now, why not just save up this extra bit and pay off the bill all at once? Easy! While you’re earning a percent or two per year (if you’re lucky!) in a savings account, that credit card balance is costing you up to 20% (or more). It just doesn’t make sense to save at a loss, you know?

Also, by concentrating your “extra” on one card at a time, you’re seeing results quicker (which is why I like to start with the store cards first–they tend to have higher interest rates and lower balances) and will then have a larger amount to roll onto your major card minimum payment when the time comes. Obviously if you’ve got a card that is in danger of going over your credit limit, it’s a good idea to get it down to a more reasonable level first, but we’re working from the idea that things aren’t quite that dire just yet.

This isn’t going to work for everyone, of course, but it is working for me, so I thought it was worth sharing. I don’t think I’ll be completely debt free by the wedding, but I’ll be in a lot better shape than if I didn’t do anything!

Pretty Book and Flower Icon


What’s your plan for debt management?

2 thoughts on “Climbing Out of a Debtor’s Rut: Try It Yourself

  1. It’s always tempting to say “That $35 was really extra anyway, so it’ll be ok if I skip it and buy this this month, instead.” – but that is a slippery slope!
    Like you, I was left with, shall we say, “unbalanced” liabilities after a divorce. I paid off a high-interest, high-balance card (the worst combo) last Sept and it was a great feeling to get out from under that. Only the balance of my car payment was higher, but the interest rate is much much lower, making the payment quite tolerable. If I can keep my current stack and stick to it, I’ll be all done in just over 2 yrs.
    …..”but it’s so SHINY!”

    1. Exactly–if you just get into the habit of paying x amount every month, it’s a lot easier to keep up with it.

      I haven’t figured out how long it’ll take me to fully get out from under the credit card debt but it’s a lot sooner than if I didn’t do anything! Judging by the little comparison charts that the credit card companies are now, I think, required to print on the statements it’ll be 3-5 years for everything.

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