The 6 Step Plan To Eliminate Debt

Credit cards, mortgages, medical bills, it all adds up and it's easy to fall into debt. Being in severe debt can feel overwhelming, and minimizing that debt takes time, planning, and dedication.

Once you commit to making fundamental changes to your lifestyle, you're one step closer to eliminating that debt.  Even better, managing debt get easier with time as you build new habits.  To start make a structured plan for yourself like the 6 step plan we have created below.


Follow These 6 Steps to Eliminate Debt

  1. Take into account ALL of your accounts
    Make a list of all your outstanding debts. Include the interst rate (APR) on each so you’ll be able to rank which ones are charging you the most to borrow.

  1. Check your credit report

You can request your full credit report for free once a year. is the official side for requesting your credit reports from the three major consumer credit bureaus: Experian, TransUnion and Equifax. It’s a good idea to check your report to make sure there aren’t any accounts you don’t recognize. This report will not give your credit score. If you want to check your credit score, check with your bank or credit card company to see if they can provide you with your score at no cost.

  1. Look for opportunities to consolidate

If you have multiple high-interest loans, can you consolidate them into one loan with a lower interst rate? Do you have access to a low-interst personal loan that you could take out to pay off high-interst credit card balances?

Note: Before consolidating or refinancing any student loans, you should carefully review your eligibility for federal loan forgiveness programs which may be impacted by loan consolidation or refinancing.

  1. Be honest about your spending

If your debt feels overwhelming, it’s worth taking an honest look at what you’re spending each month. What can you cut from this list? Are there subscriptions you can live without? The first step in reducing debt is limiting the additional debt you take on. Use our Estimated Budgeting Sheet (linked) to visualize your current monthly obligations.

  1. Determine how much you have to pay

Once you’ve consolidated and examined all debt, calculate how much you have to pay each month by noting the minimum payments and put the total into your Estimated Budgeting Sheet. If the amount is more than you can manage in your budget you may need to contact your lenders to see about arranging different terms.

  1. Budget extra to pay off debt if you can

Once you have the baseline of how much you have to pay each month in your budget, determine how much extra from your budget you can devote to debt reduction. If you can, target this money to the highest interest rate accounts.

Need help getting your plan together? Call to speak with our payment support team 804-918-9606.


Download the Estimated Budgeting Sheet HERE.


Mobility Trust does not provide tax or legal advice. This piece is being provided for educational purposes only and does not constitute a recommendation or advice. You should carefully consider your unique circumstances before making any decisions regarding your personal debt. 

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