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9 steps to get out of debt, Ashley-style

The short


  1. Remove high-interest rates from debt

  2. $1k Emergency Fund

  3. Snowball method

  4. Reduce expenses

  5. Budget by paycheck

  6. Automate payments

  7. Bi-weekly budget audit

  8. Adjust budget

  9. Place Medical Bills on Payment Plan


The long


Remove high-interest rates from debt

High credit score means low-interest rate offers

There are things you can do to increase your credit score without paying off your debt


$1k Emergency Fund

Save $1k - pay minimums on debt until you have $1k saved

Save these funds in a savings/checking account that is separate from your day-to-day spending account.


Snowball method

Make minimum payments on all debts EXCEPT for the smallest balance debt.

Pay any extra $ toward smallest debt

Once that is paid off, put all the extra $ toward the NEXT smallest debt


Reduce expenses

Lower bills where you can

Like a certain provider's towers? You can almost always get a cheaper plan with a different provider who uses the same towers

Increasing insurance deductibles lowers insurance premium)


Budget by paycheck

Map out a future plan for your money, but base it on pay dates vs bill due dates


Automate payments

My fav is to setup online bill pay through my bank

Makes it easier to make payments from one screen/app

I generally prefer to decline auto-pay

I generally set most/all bills to pay on payday via online bill pay through my bank's site/app

I automate these payments as I update my budget


Bi-weekly budget audit

I double check to make sure payments posted

On my budget spreadsheet, I'll more bills as orange if they're pending/payment is setup. Yellow highlighted items are bills that have posted and the amount has been deducted from my bank account


Adjust budget

If a bill is starting to increase, increase future planned $ for that item Recently, we increased our monthly grocery/miscellaneous expenses from $1200/mo to $1400/mo We increase our electric bill budget in the summer and decrease it in the winter

Place Medical Bills on Payment Plan

Call and ask to setup a payment plan to pay the least amount per month that the provider will accept payments - I usually start by saying I can pay $25 and see what they say.

Do not pay extra $ toward medical bills until all other debt is paid off

Medical bills are interest-free

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