You can get out of debt on your own! I paid off $15,000 in credit card debt in about 3 months. It’s not easy, but these rules helped me do it. Learn how.

If you want to get out of debt on your own (and fast), this is the post that will help you do it.

Not someday. Not tomorrow. Right. Freaking. Now.

  • Get ready—here’s the table of contents:
  • Yes, you CAN get out of debt
  • Confront it: How much debt do you have?
  • Change the behaviors that got you into debt
  • Earn enough to get out of debt
  • Tools to help you get out of debt
  • Credit card balance transfers
  • Debt consolidation loans
  • Credit counseling/debt management

Yes, you CAN get out of debt

I managed to pay off $15,000 in credit card debt in just over three months. I know how to get out of debt and I know you can do it, too. It is simple but not easy!

As a debt junkie for since my first paycheck, I ran up credit card after credit card living like my salary was about four times its actual size. Stupid things I bought on credit included a lot of exercise machine that I only used once. But the truth is, we don’t go $15,000 in credit card debt buying one stuff for $15,000 but we go $15,000 in credit card debt buying 300 stuff for $50. The incremental was not drastic and hence, the lies that we told ourselves ‘it’s okay, it’s only $50’.

Soon enough, the debt caught up with me. As I approached my 26th birthday, I maxed out with debt of around $80,000. All of a sudden, I couldn’t keep borrowing my way out of trouble anymore. At the same time, I realized that the stress of barely making my monthly payments and owing twice what I earned in a year was taking its toll especially when you have a family to support and a newborn baby depending on you to make ends meet.

So I decided to change.

I’m a smart guy. And I don’t consider myself afraid of a little hard work especially I used to work from 9AM – 4AM workdays before. So several months ago I decided to change after I calculated my net worth to be over (-) $250,000, I resolved to:

  • Get out of debt on my own.
  • Go a step further and achieve a kind of financial stability that most people never do.
  • Blog about it in a way that makes it accessible to others.
  • And I did.

Today, I have no credit card debt. However, currently I am working to clear off my outstanding debts on my Auto-loans and student loans. FYI, currently my debt is already below $200,000 since I started my journey since April 2017.

Contrary to what hundreds of marketers and self-described personal finance “experts” will try to sell you—there is no secret to getting out of debt. No right way. No silver bullet. Because everything worthwhile in life has a price.

That said, I think it is fair to say there are a few requirements to permanently ridding yourself of consumer debt.

  • You must confront your debt by calculating your debt ratio.
  • Permanently change the behaviors that got you into debt.
  • You must make enough money to repay the debt.

Throughout all the years I carried this debt around with me, I never wanted to be in debt. But it wasn’t until I met the three criteria above that I was able to do something about it. First, I had to stop living in denial, telling myself my debt “wasn’t that bad.” I needed a reality check and to stare down exactly how much debt I had and what it would take to get out.

Second, I needed to figure out why I was in debt and stop doing those things. I had to tone down my lifestyle. By a lot.

Finally, I had to find a way to earn enough to repay the debt. Some would suggest to take up a second job, even though the idea is tempting, I decided to start a part time business which contributed greatly to me paying off over $50,000 in debt (inclusive of that $15,000 in credit card debt)

Now, let’s break this down and see how you can apply these three requirements to your debt.

  1. Confront it: How much debt do you have?

I know you might be afraid of how much debt you have, but ignoring the problem will never make it go away.

There was a time in my early 20s, when my debts were steadily mounting, that I knew I was in trouble, but I was too scared to actually tally up how much debt I was in.

I paid minimum payments and forgot about them until the following month. If this is you, or if you simply need a refresher as to your current (negative) net worth, let’s go take a look. Tally up all your debts.

Credit cards. Student loans. Auto loans. And anything else. For now, we’ll leave your mortgage out of it.

That’s your number.

Although your absolute total debt is important, it’s not as important as how that debt compares to your annual income. It’s time to calculate…

  • Your debt to income ratio

This is a commonly used figure that puts your debt into perspective relative to how much money you earn.

A debt-to-income ratio (DTI) is often calculated different ways. For example, when you apply for a mortgage, the banks calculate your DTI as the percentage of monthly debt payments of your monthly income.

A few years ago, I read the book Your Money Ratios by CBS MoneyWatch columnist Charles Farrell. I liked Farrell’s idea of simplifying financial planning by applying ratios to personal finance (something that financial professionals do all the time, anyway).

Although not one of Farrell’s ratios, I like to calculate a debt ratio as the amount of total debt (excluding mortgages) as a percentage of gross annual income.

Example 1: You earn $50,000 a year and have $25,000 in debt. Your Debt Ratio = 0.5.

Example 2: You earn $100,000 and have $250,000 in debt. Your Debt Ratio = 2.5.

This gives you a benchmark for how indebted you are (and what it will take to escape).

In case you’re wondering, my debt was way above 2.0 for a while.

So whatever your debt ratio, don’t despair. If yours is way up there, it just means you have some work to do.

  1. Change the behaviors that got you into debt

The first step of any injury treatment is to stop the bleeding.

Getting out of debt begins by eliminating the reasons you went into debt in the first place. Even winning the lottery won’t solve your problem if you never learn how to spend less than you have.

People get into debt for different reasons. School, job loss, medical bills, or, if you’re like me, stupidity. But why you got into debt doesn’t really matter. What matters is that you don’t let it happen again! Here’s what not to do.

If you took out $50k in student loans for a bachelor’s degree, don’t take out $100k more for a PhD.

Did you fall into a pile of debt after losing your job? Resolve (once you get out of debt), to work on an emergency fund so this will never happen again.

If you, like me, spent years living a life you couldn’t afford, then figure out what the life you can afford looks like, and get there.

This last step is easier said than done. In fact, that goal alone is responsible for about a third of every personal finance article every written. “Live within your means,” “Spend less than you earn,” etc., etc. Why has so much written about such a simple concept?

Because once we get accustomed to living a certain way, it’s incredibly difficult to change. You know, how do you start living on ramen after years of eating out in fancy restaurants?

Well, we need to grow up ! why? Because we really need to behave like adults, ADULTS DEVISE A PLAN AND DO IT, WHILE KIDS DO WHATEVER THE WANTED TO DO !

That’s where this comes in: 

  1. Earn enough to get out of debt

If you want to get out of debt by yourself, you need to earn enough money to survive AND enough money to pay down your debts.

Put another way: You need to go from a situation in which you’re spending more than you earn into one where you’re earning more than you spend. And the faster you want to become debt-free, the more you have to earn above and beyond what you spend.

Why earning more works

Personally, I knew I was never going to get out of debt just by cutting spending—unless, perhaps, I lived with my parents until 35. (No offense, Mom and Dad, but no thanks.) I simply didn’t earn enough money. I had to earn more.

If you put your mind to it, you can get out of debt, you can increase your income, and you can get a better job. If you put your mind to it, you can start a part-time business.

Not everybody has to earn more money to get out of debt, but it makes it a lot easier.

There are literally endless ways to earn extra money, but all could fall into these three categories.

  1. Sell stuff

If you have stuff, then you can make money. Find stuff you don’t use anymore and hit up eBay or Craigslist or a yard sale or in any other online marketplaces such as Shopee, Lazada, 11st etc.

The good thing about selling stuff is you can get cash fast. The bad news is, it’s not sustainable; sooner or later, you’re going to run out of crap to sell.

  1. Work harder

Get a second job or work overtime, if available. I’ll be blunt, second jobs are no fun, but they sure do help pay the bills. Think of how tired/stressed/soulless you feel after your 9-5 already; now imagine getting in your car, battling rush hour traffic, and putting in another four hours from 6 to 10. Then you get home around 11 and pass out.

Putting in extra hours earns extra dollars, but it can suck the life out of you. If this is the route you want to go, however, there are options: food service, babysitting, mall stores, delivery routes, security guarding, tutoring, teaching prep classes, bartending, cab driving, etc.

  1. Work smarter

This is my personal favorite way to increase your income, and you’ll see why. Working smarter is about getting promoted at work. Or, if your job won’t promote you, finding a higher-paying job. Or, if you can’t find a higher-paying job, working for yourself. If you make the decision to earn more money by working smarter, you just have to do.

Tools to help you get out of debt

Motivation is half the battle, but if there are tools available to help you get out of debt yourself, why not take them?

Someone looking to get out of debt in 2017 has it way easier than debt fighters of just a few years ago. The credit crunch is long gone. Unless you totally scorched your credit score, you should be able to use the credit system to climb your way out of the hole.

  • Balance transfers

In some cases, a 0 percent balance transfer credit card can provide immediate relief from high APR credit card debt. But balance transfers are not, by any means, a cure-all.

Here’s how balance transfers work: As a way of attracting new customers, credit card companies will let you transfer a balance—in other words, a debt—from one credit card to a new credit card at 0 percent interest for a certain number of months. For example, if you were to transfer a $2,000 balance from one card (15 percent APR) to a new card (0 percent APR for 12 months), you could save up to $300 in interest.

But there are plenty of pitfalls to this approach.

There is often a fee to transfer a balance, which can eat into your savings.

Transferring a balance doesn’t solve your debt problem if you can’t make big enough payments—it simply buys you some time.

You need very good credit to get approved for new credit card, and if the balances on your current credit cards are too high, you might be denied anyway.

More credit means more temptation to spend.

  • Debt consolidation loans

It’s becoming much easier to find unsecured personal loans that you can use to consolidate multiple debts into one affordable monthly payment.

You’ll still need good credit to get a personal loan, but you may be able to get a loan when you wouldn’t be approved for a credit card. And if you’ve got excellent credit, you might even get a lower interest rate with a personal loan. Either way, the thing I love about personal loans is that you get a fixed term, usually three or five years, and monthly payment—you can’t be tempted to make minimum payments and you know your debt will be paid off at the end of the term.

If you think consolidation loan could help, learn more about when a personal loan makes sense for debt consolidation or compare some of the best personal loan options. However, I would take this step with a bit more cautious, because debt is still debt, don’t get into a situation whereby you get yourself out of one hole to land into a much bigger hole!


  • Credit counseling and debt management

Although you can save money by getting out of debt on your own, sometimes it just doesn’t work. That’s where credit counseling and/or debt management may help.

But proceed carefully. Although the government has cracked down a bit in recent years, there are a lot of companies out there that advertise these kinds of services that will only make matters worse. Avoid debt settlement scams or any service that promises to reduce the total amount you owe. Avoid any service that charges big upfront fees.

You may also want to research (either through your counselor or on your own) entering a debt management plan. Under such a plan, a third-party company negotiates interest rates, payment amounts, and fees with your creditors. You make one monthly payment to the third-party company and they pay all your creditors.

Now, take action!

Are you still reading this? Amazing. Thank you! The bottom line is, none of all that I’ve just written is worth anything unless you take action. Getting out of debt is a long process, you CAN start today. And that’s what I ask you to do:

Within 24 hours I want you to do something—anything—towards getting out of debt.

Here are just a few ideas of things you could do, but I urge you to get creative!

  • Cut up a credit card – or I would call it plastic surgery!
  • Post something you own for sale
  • Write down a goal to earn more money
  • Submit an application to a new (higher paying or additional) job
  • Transfer a high-interest rate balance
  • Confront your debt (write down your total debt and debt ratio)
  • Reexamine your budget
  • Make an extra debt payment
  • Look into credit counseling

Well, that’s all for now, best of luck for your debt free journey as I continue mine !


Categories: Personal Development, Personal Finance

1 reply


  1. My notes on The Richest Man in Babylon Part 4 : The Clay Tablets from Babylon – Personal Growth Blog

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