What’s the best way to pay off debt fast? Well, just ask the 8,000 people who joined our Debt Bootcamp recently. Together, this group paid off 1.5 million dollars of debt in just two months.
This bootcamp was a new format we offered and it was full of fantastic discussions from the community, live video instruction, fresh perspectives from the YNAB team, and plenty of written resources. There’s something about wrapping all these styles of learning into a tight-knit, energetic community that really supercharged everyone’s debt payoff.
And, by the way, we’re definitely doing this again. We’re going to start two new bootcamps soon: paying off debt and getting started with YNAB. Sign up for our newsletter to get updates on joining the next round of bootcamps!
Sure, we’ve been teaching this stuff for years, but this group taught us so much about what actually resonates when you’re all-in on debt payoff! Here’s how to pay off debt fast (and stay out of debt for good):
1. Breaking the Cycle of Debt is Your First Priority
Think you should throw everything you’ve got at paying down that credit card? Hold that thought: this might blow your mind.
When we teach people how to make a debt paydown plan, we always say to take care of Immediate Obligations (like rent, mortgage, utilities) first before putting any extra on their debt. Most everyone sees the logic in prioritizing Immediate Obligations. Obviously, you’ve got to pay the rent, keep the lights on, and buy groceries.
Then, we teach to prioritize your True Expenses next—before aggressive debt paydown (these are non-monthly expenses like car insurance, taxes, car registration). Did you catch that? Before aggressive debt pay down, save some money for a car repair even though your car isn’t broken yet.
We sometimes get pushback on this prioritization of True Expenses. Some ask us, “Why should I save for a car maintenance bill that may not be coming for six months when I’ve got all this credit card debt facing me right now? Shouldn’t I throw everything I possibly can at the debt?”
That’s a valid question, because that’s what most of the experts and bloggers will tell you to do. But here’s why it’s so important to prioritize those non-monthly expenses: to move forward, you’ve got to stop going backward. You’ve got to put a line in the sand and say “No more debt!” Then, you’ve got to take the steps to make that happen. If you don’t break your reliance on debt first, the intense sprint to pay off debt won’t matter. Picture how discouraging it would be to pay off all your credit cards only to have your car break down the next week and you’re back in the hole. That would be so incredibly discouraging.
To move forward, you’ve got to stop going backward.
You see, the problem is below the surface: if you don’t pull a weed up by the roots, it will grow back stronger than ever. In the same way, if you only pay off the debt you have without addressing the underlying debt cycle that caused that debt in the first place, debt will creep back into your life slowly at first and then all at once. That’s why embracing your true expenses (and prioritizing them in your debt payoff) is the ultimate debt prevention tool. It breaks the cycle of debt so you can do more than just pay off your debt. You can become truly debt free—forever.
Before this bootcamp, we didn’t fully appreciate how important this message was. This reprioritization set people free! Very quickly, a huge part of the conversation in the community shifted from just paying off debt to preventing future debt as well.
2. Free Yourself From Shame
The first week of the bootcamp, we spent a lot of time getting to know each other. My heart broke over and over again as I read post after post from beautiful people struggling with shame, fear, and paralysis because of their debt. This bootcamp revealed how much emotional distress debt causes. Debt is more than a financial burden—it was an emotional and mental burden too. Many spoke of feelings of inadequacy, failure, and isolation that went along with these debt loads.
The good news is that talking to others about your debt and realizing you’re not alone is a healing balm. Just having a place to talk about it made a huge difference for so many. There is a stigma about debt in our culture that silences us and makes it very difficult to find healing.
And here’s something else we learned from hearing everyone’s stories: shame is not all bad. If negative feelings like that can spur us to action, it can blossom into a positive thing. But once we make a plan and take action to change our lives, it’s time to put the shame away. It’s not going to help us anymore. Make a plan, stay the course, get some trusted friends around you, and say goodbye to that shame.
3. Food Costs — OMG!
When people are looking to cut back on expenses so they can put more money on debt, food cost is almost always at the very top of the list. So many new YNABers are shocked to find out how much they’re actually spending on food, especially eating out. So the community shared a ton of ideas on how to save money on groceries, meal plan, and how to eat well on a smaller budget.
If this sounds like you, check out our workshop on how to save money on groceries. We’ll talk about meal planning and all sorts of other tips to cut down your food costs.
4. Sometimes You Need More Income
In addition to cutting spending, sometimes you’ve got to find ways to earn some extra money. There are often opportunities to increase your income over the long term, but sometimes a short-term boost might be just what you need. Members of the debt bootcamp loved to talk about selling stuff—big and small, working overtime, starting new businesses, and taking on flexible but impactful side hustles.
Interestingly there were others who realized they had stretched themselves too thin and needed to work less, not more. There may be short stretches when you work like crazy to really get a boost on your debt paydown journey, but that may not always be healthy over the long haul. It was very refreshing to see the community encourage some who needed to take a step back and take more time for themselves and their family. Paying off debt is usually a marathon, not a sprint, so you need to set a sustainable pace.
5. Stop Trying to Do This Alone
I love watching gymnasts in the olympics. Seeing a fellow human being do something I could never in a million years is mesmerizing. But you know what I love even more than gymnasts’ death-defying flippy jumps? It’s what’s in the background. You’ll almost always see a group of other gymnasts or a coach absolutely freaking out at an amazing routine. You’ll also see them wrap their arms around their friend when things don’t go so well. Gymnastics is not technically a team sport, but when I see all the people who worked so hard to help a gymnast excel, it’s plain to me that it actually is.
Paying off debt is just like that. Sure, it’s your own flippy routine to pay off debt, but you’re not going to excel without a support system around you to coach, encourage, and challenge. Get some trusted friends and family members around you—or join a group of strangers online (like in our Debt Bootcamp!) who will root you on. There was some real magic in the group of YNABers who celebrated with each other, gave each other advice, and picked each other up when they were down.
Throughout the bootcamp there was a unifying thread of hope. People showed up wanting make a change, working toward it and lifting up others around them in the process.
Get the support and encouragement you need to pay off your own debt. Jump into our next Debt Bootcamp starting this spring (subscribe to our newsletter to be notified when signups open).
Want to learn more about gaining total control over your money in the meantime? We offer learning in every shape and size here at You Need a Budget (or YNAB for short). Whether you prefer reading, watching, or free live instruction, we’ve got it all!