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Living a debt free life is very much possible – 10 Steps to follow

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A debt free lifestyle requires less effort than what you actually think. All you need to do is select the right way to pay back your creditors. Once you start living a life without an escalating credit card balance or frequent calls from collection agencies, you can get back the peace of mind.

Check out the 10 simple steps which you must follow to lead a stress-free life.

Step 1:

Accept the fact that you're in debt because of your own fault

You can just forget about living debt free unless you accept your fault. You're in debt problems because of the following reasons:


  • You've borrowed recklessly
  • You've missed out your payments
  • You didn't save money
  • You've ignored your creditors
  • You didn't have any control over your expenditures

Accept your mistakes and start rectifying them. This is the first step you need to take for living a debt free life.

Step 2:

Promise yourself that you'll be living a debt free life

It's difficult to live debt free without any strong resolution. Promise yourself that you'll be living debt free after a specific period of time. Once you've set up a goal, start taking steps to achieve it.

Step 3:

Make a correct list of your debts

It's high time you know how much you owe to your creditors. Go through the unopened and opened bills. Make a list of your debts - from big to small. Calculate your total debt amount. Don't forget to note down your net monthly income. This will help you understand where you stand financially.

Step 4:

Decide how you want to attack your debts

You've to pay back your creditors. You know how much to pay your creditors. Now, you have to decide about the payment strategy. Ask yourself if you can negotiate with your creditors and pay them back on your own. You can check out the DIY section for any assistance. However, if you're not confident about handling your creditors, then it's better to seek professional help.

Step 5:

Seek assistance from a professional to live debt free

A professional can tell you how to live a debt free life. He/she has the knowledge and the expertise to help you get out of debt. Discuss your financial situation with the professional. Don't hide any fact or else the professional won't be able to guide you properly.


A professional can help you choose the right debt relief option. If your desire is to lower the interest rate on your credit cards, then enroll into a debt consolidation program to pay back your creditors through affordable monthly payments. However, if you wish to bring down the outstanding balance, then go for the debt settlement program.

Step 6:

Attend the counseling session and follow a budget

Attend the free counseling session offered by the debt relief company. This is the time when the professional will ask various types of questions to you. Answer each question correctly. Mention the name of your creditors and the amount you owe to them. Make sure you inform the professional about your interest rate and minimum monthly payment amount so that he/she can make the best decision.

In case of a debt consolidation program, the professional will help you plan a budget. You'll have to adjust your lifestyle to fit into that budget. The professional would like to know the amount you can save through budgeting.

Step 7:

Follow-up with the negotiation process properly

In a consolidation program, the professional will explain your creditors why you can't pay the high interest rates any more. The professional would request creditors to allow you pay back your dues through affordable monthly installments.


If you opt for debt settlement, then the professional will request your creditors to cut down your total debt amount. He/she will request creditors to settle debt through a lump sum payment.

Step 8:

Pay back your creditors for living a debt free life

Start making payments on the basis of the debt relief option you've chosen. If you're working with a consolidation company, then send single monthly payments to pay back your creditors within a period of 2-4 years. On the other hand, if you decide to pay off your debts through a settlement company, then start saving money in a trust account. Once you have saved a lump sum amount, the professional will contact your creditors and hand it over to them.

Step 9:

Adopt a frugal lifestyle and get extra work

You can't afford to lead a luxurious life when creditors are knocking at your door for payments. You have to get accustomed to a modest life. Buy cheaper brand of items in order to save money. Resist your temptation of dining at expensive restaurants. Rent DVDs to watch your favorite movies. The idea is to save as much as you can.


Get extra work to earn more dollars. You can work for some extra hours at your office to make money. Otherwise, you can also do side jobs in your free time. You can work from your home to make some serious money and get debt free.

Step 10:

Stay away from new loans to stop accruing debts

Keep your credit cards at a safe place. Use cash to make your purchases instead of whipping your cards. Reject the new credit card offers, no matter how much tempting they're. Avoid borrowing from the payday loan lenders. If you're a student, then apply for scholarships so as to minimize the chances of taking out an educational loan.


It is not easy to live a comfortable life when you're in debt. However, don't get too much stressed for several people are trying to get back on the right financial path. Relax and entertain yourself by reading a good book or watching a TV show. Your mind will work fast when you are properly rested. You'll be able to manage debt in better way.

Last updated on July 26, 2013"


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