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If you are grappling with debt, you are not alone. The average American, for instance, is currently carrying $7,321 in credit card debt as of 2025. But that doesn’t mean you have to live saddled with owing money and being charged high interest rates.
There are ways to make debt payoff happen faster. Read on for three strategies that can help you repay what you owe ASAP.
Key Points
• To manage debt, establish a budget to track income and expenses, aiming for a 50/30/20 allocation.
• To pay off debt, use the snowball method to eliminate the smallest debts first for quick wins.
• Apply the avalanche method to target high-interest debts first.
• Put extra cash, like bonuses and refunds, toward debt repayment.
• Consider debt consolidation through a balance transfer card or personal loan.
1. Figuring Out Your Budget
The first step to solving any debt problem is to establish a budget. A budget is essentially a summary that compares and tracks your income and expenses for a period of time, typically one month. A budget also allows you to plan how much you will spend and save each month.
You’ll want to first gather all of your bank and credit card statements for the last three or more months. You can then use them to figure out your monthly income (after taxes) and also list all of your monthly expenses. (You can do this using pen and paper, a spreadsheet or a budgeting app.)
You may want to group expenses into categories (such as insurance, groceries, eating out, insurance), and also divide them into essential vs. nonessential spending. From here, you can total your average monthly income and average monthly spending, see how they line up, and then consider making some shifts in your spending.
You might consider the 50/30/20 budget as a simple way to reorganize your finances. This budget allocates 50% of your income for essentials, like rent and bills, 30% toward nonessentials or wants, and 20% for savings and debt repayment.
If you need to free up more money to put towards debt repayment, you may want to look at your nonessential spending to find ways to cut back, such as ditching your cable bill, cooking more and getting take-out less often, and canceling your gym membership and working out at home.
Decreasing discretionary spending tends to be the easiest way to generate a monthly surplus. That surplus can then be used to pay off your debt faster.
If you find that you’ve been spending more than you earn by using credit cards, you may also want to make a plan to stop using those cards while you go after lowering your outstanding debt.
2. Choosing the Right Repayment Plan
Once your budget is set up, a great next step is to list all of your debt (with amounts owed) and in order of interest rate, and then come up with a manageable plan to pay them off.
Some options that can help you pay off debt faster include:
The Snowball Method
The snowball method is where you focus on paying off your debts in order from smallest balance owed to largest.
You can do this by paying the minimum on all your debt and:
• Then allocate any extra money you have to the debt with the smallest balance.
• Once the smallest debt is paid off, you can take the money you were putting toward that debt and funnel it toward your next smallest debt instead.
• You then continue the process until all your debts are paid.
The key benefit of this method is that it allows you to experience a series of small successes at the beginning. This can give you more motivation to pay off the rest of your debt.
The Avalanche Method
Another effective debt elimination strategy is the avalanche method (also known as debt stacking). With this approach, you would pay off your accounts in order from the highest interest rate to the lowest.
• You would make the minimum payment on all of your accounts, then put as much extra money as possible toward the account with the highest interest rate.
• Once the debt with the highest interest is paid off, you can start paying as much as you can on the account with the next high interest rate.
• You would continue the process until all your debts are paid.
Putting Extra Cash Toward Debt-Reduction
Once you have an emergency fund (that can cover three to six months’ worth of living expenses) in place, you may want to funnel any extra income you receive right into your repayment plan in order to pay off debts faster.
That extra might be a bonus you receive at work, a tax refund, any side hustle income, or cash earned from selling items you don’t need — all of this money could go directly toward your debt payoff.
Putting this money toward your debt, instead of saving it for a new car or spending it on a vacation, can help you pay off your debt quicker so you can eventually shift your financial focus to more fun goals.
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3. Looking Into Debt Consolidation
Another option you may want to consider is rolling multiple debts into one payment (ideally with a lower interest rate) through debt consolidation.
This can make your debt easier to manage (because you’ll only have one monthly bill) and less expensive overall. The less you have to pay in interest, the more money you can put towards reducing the underlying debt.
• One way to consolidate debt is to get a 0% interest balance transfer credit card and then transfer all your debts onto this card. Typically, you will have six to 24 months of no interest during which time you can pay down your debt. Just read the fine print to be clear on what interest rate you may pay on new purchases and when the interest-free period ends.
• Another option is to get an unsecured personal loan. In this case, you would use the money from the loan to pay off your debt, then pay back the loan in installments over a set term. Typically, these loans can offer a significantly lower interest rate than what credit cards charge, but shop around and carefully review your options before signing up.
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The Takeaway
If you’re looking to pay off your debt faster, it’s a good idea to review and reduce your spending and then funnel any money you free up towards your debt repayment plan. The snowball or avalanche methods can help with this. Other options to pay off debt faster include investigating debt consolidation options, such as a balance transfer card or personal loan.
Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.
FAQ
What are the best ways to get out of debt?
Getting out of debt can involve smart budgeting and using techniques like the snowball or avalanche method to pay off the amount you owe. You might also consider a balance transfer credit card or a personal loan to help with getting out of debt.
What is the 15/3 payment rule?
The 15/3 payment rule is a credit card technique that involves making two payments every month: a larger one about 15 days before the statement closing date and a smaller one about three days before the due date. This method can help reduce your credit utilization ratio by lowering the credit card balance reported to credit bureaus.
What is a trick people use to pay off debt?
A trick people use to pay off debt is the avalanche and the snowball technique. With the avalanche method, you pay the minimum amount on all debts and funnel any excess funds toward debt with the highest interest rate to have the most impact. With the snowball method, you put the excess toward the smallest balance to show success as quickly as possible.
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