12 Habits of People Who Get Out of Debt (and Stay That Way)

Being in debt can feel incredibly humiliating. There’s a sense of powerlessness and frustration for what you’ve gotten yourself into.

But I promise you, there is so much dignity in working towards a goal that will eventually get you out of debt. Also, you and your future are worth it. You don’t deserve to stay financially handicapped just because of some past mistakes.

And if you want to get rid of your debt and start living a financially free life, then here are some habits of people who have done it themsevles.

They went through the process and know what it takes, which means you can do the same and maybe even help others once you’re living a debt-free lifestyle.

1. They Practice Patience and Stay Future Focused

Becoming debt free requires dedication and diligence. You didn’t get yourself into this hole overnight, which means it will take time to climb out. And while making financial sacrifices now can feel a bit suffocating, it’s such a good time to grow in patience and future thinking.

So look at what saying no to yourself now will bring you in a few months down the road. You’ll be able to rest more easily at night, you’ll have more money for the things you actually want, and you won’t be stressing out over sudden emergencies.

2. Recording Expenses

Whether it’s a $1 pack of gum, your rent, or new car tires, all expenses should be tracked.

That way you can see exactly where your money is going each month, and make adjustments so you can pay off your debt more quickly. There should be no mystery around your finances; it should all be understood so can take control of your spending.

3. No New Debts

Cut up your credit cards and throw them away. This will help you to avoid the temptation of using it, and get you out of that endless cycle of paying off a bit and then going right back into more credit card debt.

And while you’re at it, build up an emergency fund so that if an emergency does pop up, you’re not going into debt once again.

4. Snowballing Debts

Many people who are debt-free use a method for getting out of debt. And a lot of them choose the snowball method.

Here’s how it works: look at each of your debts and put them in order of smallest to largest. Then throw as much money as you can at the smallest debt each month (while paying the minimum on the others) until it’s gone. Then take what you were paying on the smallest debt and throw it at the next debt. Repeat until all debts are gone.

This works because it builds up momentum (like a snowball) and energy for cutting costs and paying off your debts.

5. They Identify Their Triggers

Whether you love online shopping or reach for the credit card after a bad day, you need to identify when you’re most likely to spend. And by becoming mindful of this, you can take action and find ways to stay away from spending.

6. They Only Use Cash

An important part of being debt-free is spending only what you have, and people who get out of debt only use cash when shopping for groceries, clothing, and other items.

Why? Because cash is psychologically harder to part with, and it’s even harder to overspend when you’re limited to a certain amount of money for each spending category.

7. Cooking at Home

Yes it’s fun to eat out after a long day of work, or go out to breakfast with friends. But that money could actually help you pay off your debts a lot faster.

And people who want to be debt-free cook at home, bring their own lunches to work, and learn to say no when their friends invite them to brunch.

Of course, every now and then is fine, but every day really does add up to a lot of cash.

8. They Find Local Activities

Debt free people learn to take advantage of what’s in their community. And chances are, there are free (or nearly free) activities in your city too! You can check out Facebook groups or your city’s websites to find fun events or activities you can do with your friends and/or family.

9. They Practice Underconsumption

Underconsumption and de-influencing yourself is kind of crucial during this time of getting out of debt. You and I are surrounded by influencers who are sharing their lifestyles and what they’re spending money on. And it’s so easy to see those pretty crystal glasses or that cute dress and suddenly feel like you need to do a bit of online shopping.

So now is the time to clean up your feed and stay away from people who are selling you a lifestyle you can’t afford at the moment.

10. Goal Oriented

Creating and sticking to goals is one of the hardest parts of becoming debt-free. But people who are getting out of debt know that their goal is so much more important than that in the moment desire.

They know the freedom it brings.

So when you create your get-out-of-debt goal, visualize the life you’ll be living once it’s gone. What are you going to be able to do then that you can’t now? Also, you might want to create a vision board to help you get there faster!

11. They Make Thoughtful Purchases

When making a purchase, and especially a big one, debt-free people research before buying. It’s important to not just focus on the best price, but also the quality of a product. High-quality appliances, cars, or shoes means less repair payments and replacements down the road.

12. Extra Income

Whether it’s another part-time job or a side hustle, extra income can go towards paying off your debts.

And people who actually get out of debt don’t make excuses around this. They cut out the time they would have wasted on doomscrolling to make more cash on the side.

So look for a service you could sell online or in person, or a job that’s nearby that’ll help you make bigger payments every month.

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