If there is anything I’ve learned about debt is the fact that debt isn’t just numbers on a screen.

If you are in debt, and I mean a lot of it, you know it manifests itself in stress, sleepless nights, feeling stuck, and in the most severe cases, fear of falling behind and feeling like you’ll never be able to get out of it.

Debt feels like you are chained to a big rock while trying to climb out of a hole.

(BTW, the picture below is the massive debt we had. This is a spreadsheet after we had already started paying off our debt).

You know how I know?

Because I’ve been there.

In 2018, my wife and I faced the harsh reality of $215,000 in debt, despite decent incomes as a nurse and engineer.

It was our first year of marriage, in our late 20s, and we’d started talking about the next phase in our lives.

We wanted to start having kids, move to a quieter place in the suburbs, and buy a bigger and safer car for our family,

But there was a MASSIVE problem.

We were in a ton of debt.

I am getting an anxiety attack just thinking about this.

Now at this point in our journey, we were on different pages.

She handled her finances, I handled mine.

But as we saw the challenge ahead of us, we had to make a decision; do we continue to live separate financial lives or do we come together to tackle this massive challenge, as a married couple should?

Well, we sat down, we merged our finances, and decided to get on a plan together.

We worked night and day tirelessly, even through the pandemic.

We decreased our expenses (but not too much because we didn’t want to go back to living like college students), and we focused more on increasing our income instead.

With working over time, doing side hustles, and selling things online, we were relentless.

Nothing mattered more than paying off debt.

But it was not all sunshine and rainbows.

During this process, we had to deal not just with the financial challenges, but also the mental and emotional ones.

Comparison, fear of missing out, shiny object syndrome.

It wasn’t easy to stay focused, especially as our friends traveled the world and moved on with their lives.

But we stayed the course.

Remembering the reason we started, we kept going and it wasn’t until 2022 when we finally made our last student loan payment.

We sat in our living room, and together we had our debt-free scream a la Dave Ramsey style!

We learned so much during our debt-free journey, and as you’re starting this journey, I want to share the 10 steps that worked for us, so you can do the same.

Step 1: Stop the bleed.

The very first step in getting out of debt is understanding and addressing the reason you’re in debt to begin with.

Debt is a side effect of something bigger going on and as psychologist Nathaniel Branden once said

“You can’t fix a problem you haven’t acknowledged.”

So spend 15 minutes reflecting or journaling about your spending habits as you commute to work and identify one behavior you can change today.

Ask yourself:

  • Are you overspending? Why? To impress others? Why
  • Are you tracking your money at all? Where is it going?
  • Lack of knowledge, carelessness
  • Or maybe you’re just not earning enough. In that case, it’s an income problem.
  • Are you filling emotional voids by spending money? Do you have any self esteem challenges?

I talked to a lady one time and she said she got into debt because she wanted to buy expensive stuff to look good and seek others’ approval.

In our case, we had expensive degrees in nursing and engineering, we had a wedding to pay off, a car loan, and yes also credit cards that funded years of crazy festivals, parties, and nights out.

So we identified our problem, and how to address it.

Now, whatever the reason you identify, the good news is your future is in your control, and as long as you change your behavior, things will change.

Now that you’ve identified the root cause, let’s talk about what will keep you going, which brings us to the next step:

Step 2: Find Your Why

My wife and I wanted to get out of debt because we wanted to grow our family. We were approaching our 30s, and the female biological clock was putting a pressure on us to get started ASAP.

We absolutely did not want to grow our family having money challenges.

That was our Why.

For you, ask yourself:

  • Why do I want to be debt-free?
  • Is it for my family? To travel? To start a business?
  • What will life look like without debt? What can you do with all of that extra money?

Write it down on a little post-it and keep it attached to your laptop.

Your “why” will pull you through when motivation ends.

If you DON’T have a strong why, you’ll most likely go back to where you started.

You know what I’m talking about!

Step 3: Build a $1,200 “Just in Case” Fund

Many people may not like this, but I don’t care. It’s what worked for us.

My wife and I set aside a $1,200 “just in case” fund, which we used to deal with unexpected expenses that could threaten our progress.

This is simple and straightforward; a short-term emergency fund.

Nowadays, I would keep this in a high yield savings account, so it can be easily accessible, and grow with little to no risk in an FDIC-insured bank.

Actionable Tip:

But please, remember, this fund isn’t for vacations or compulsive Amazon purchases; it’s your financial shock absorber!

Step 4: Audit Your Money and Create a Budget

If you’ve never tracked your spending, this step will be eye-opening.

One of the biggest misconceptions I used to have was that budgeting was about being cheap and restrictive, but I could not be more wrong.

Budgeting is about control.

Think of budgeting as doing an audit of your money. If you don’t do an audit, you won’t know how much you have, where it’s going, and more importantly, you won’t know where to put it.

Now here’s the thing, you don’t have to be that restrictive, or look at it every single day.

You could, but I know this leads to stress, so what we did was we covered all of our obligations such as our living expenses and debt payments, and anything beyond that, we would use for dinners out without going too crazy.

Again, this is what worked for us.

Action Steps:

  1. List all income and expenses.
  2. Categorize spending: fixed expenses (rent, utilities) and debt payments.
  3. You can use a budgeting app like Quicken or you can simply use a spreadsheet.

I made a free spreadsheet you can use if you’d like. Check it out here https://www.alexisidro.com/SimpleBudget

Make a copy of it, so you can use it.

It’s simple and it gets the job done.

The bottom line here is to create a realistic budget that prioritizes debt repayment without making you feel deprived.

Step 5: Use the Debt Snowball Method

This is by far the best debt repayment strategy I know, and we learned this from Dave Ramsey.

The debt snowball method helps you gain emotional momentum by paying off little debts first (regardless of interest), and then moving on to higher and higher amounts.

So here’s how you can implement it:

  1. List your debts from smallest to largest (ignore interest rates for now).
  2. Pay minimums on all debts except the smallest.
  3. Throw every extra dollar at the smallest debt until it’s gone.
  4. Repeat the same process with the next debt.

The reason this works is small wins create momentum, you feel more confident, more motivated as debts start getting crossed out of your debt spreadsheet.

Check out https://www.alexisidro.com/DebtSnowball to access a free spreadsheet I made that can help you with this.

Step 6: Consolidate Your Debts!

Hey listen, as someone who had dozens of accounts including credit cards, student loans, car loans, personal loans, etc.

I know juggling multiple debts is overwhelming, and you may even miss a payment if you are not careful.

So we consolidated many debts into one to get fewer payments and lower interests by using a balance transfer credit card, with 0% interest.

Now, I know this step can be a bit complex for some people, and getting a credit card may not be feasible, so if this were the case, I would also look into Debt Consolidation organizations and/or negotiating interest rates with creditors.

This can help you decrease the number of payments you’ll make, and in some cases, even reduce the interest rate you have.

And remember that consolidation isn’t a cure-all; it requires discipline to avoid accumulating new debt.

If you consolidate, but don’t address the problem (see step 1), you may end up with even more debt, so use this tool strategically.

Step 7: Increase Your Income

Have you ever heard Dave Ramsey say “rice and beans?”

He makes me laugh when he says this because I get what he’s saying, but honestly, for us, this did not work.

We understood we could only cut our expenses so much before we went back to living like college students, so we decided to focus on increasing our income instead.

Now, I won’t go into too much into the details of each of the strategies we followed, because well, that would be a whole other subject, but I just want to give you here a few highly profitable strategies and ideas we used, and which I would use nowadays to get out of debt faster.

I know cutting back on expenses helps, but earning more is better.

When you increase your income, this is a skill that you will learn for life beyond your debt, so definitely something I recommend.

Stoic philosopher Marcus Aurelius once said

“What stands in the way becomes the way.”

Use debt as a motivator to hustle harder. Every extra dollar goes straight to debt.

Step 8: Track and Celebrate Progress

Now, for full transparency here, along the journey to pay off debt, it will be difficult, and trust me, I know how isolating it can be.

We dealt with times when we did not know if we could keep doing it, and we lost motivation, especially when you have a lot of debt.

But if there is one thing that helped us overcome these slumps and get motivated again was tracking and celebrating the progress we made.

So here’s what I suggest you to do:

  • Create a debt tracker and cross off each debt as you pay it. This will be life-changing; to see each debt being paid off as you progress.
  • Celebrate milestones with small rewards (e.g., a nice dinner or a day trip). If you paid off a big loan, or a big credit card, give yourself a little reward you pay for cash. This helped my wife and I stay positive.

The way I see it, it’s like when you are dieting to lose weight. You can eat chicken with rice and broccoli only for so long until you decide to go for that burger.

But if you approach a more balanced path, then you will be able to keep going for longer.

Keep that fire going by joining communities of like-minded people on Facebook, Reddit, or you can start your own through Skool.

Finding your support system is crucial.

The Bottom Line

Financial security and freedom require trade-offs. You might skip vacations, downgrade your car, or say no to nights out—but these sacrifices are temporary.

As long as you keep going, are adaptable, persistent, and find support if you need to, I have no doubt you will make this happen.

Every dollar you don’t spend today brings you closer to a debt-free tomorrow.

If this post is helpful to you, please let me know! Feel free to share your struggles, successes, and progress as you go through this journey. I’d love to be part of it and help you whenever I can.