Paying Off Small Debt

If you have debt and are not already on a serious plan to pay it off, get started by paying a small debt first.

Debt can be crippling, if it overwhelms you and eats up your income with payments owed and high interest. It can be limiting, stopping you from doing what you want to do. It can be hugely stressful.

One of the best changes you can make is learning to spend less than you earn, which seems like such a basic concept except, so few people actually do it. Paying off debt (something that can take up too many years) and staying debt-free can make you so much freer, so much less worried about finances.

However, it can be overwhelming to tackle a large amount of debt — some people personally avoid it because of this feeling of dread. So, let’s tackle the debt in baby steps.

How to pay off small debt?

On Day 1, simply start a list of all your debts. Do not worry about the amounts — just things you owe money on. Do not worry about getting the list complete — just start. You might list your credit cards, auto loan(s), student loan(s), mortgage, medical debts, friends and family you owe, etc.

On Day 2, if you have not yet finished, finish the list. Start to look up the amounts and add them to the list.

On Day 3, finish looking up and writing down the amounts of the debt. If you cannot find an amount, make a guess. Now put the list in order, from smallest to largest.