In need of a get-out-of-debt plan? Whether you are tackling credit card debt leftover from the holidays or something more long-term, debt can feel like a heavy burden. Fortunately, with some financial planning and self-discipline, you can turn the situation around.

You can use these budget tips to get out of debt to start working toward financial freedom today!

1. Calculate Your Monthly Budget

Tools like budgeting apps for military families or the classic Excel document will help you create a system that works for you. Whatever budgeting instrument you choose, it’s a good idea to use the 50/30/20 rule as the framework for your get-out-of-debt plan.

How to Budget Money Using 50/30/20 Rule

First, determine your total monthly income. The 50/30/20 rule is how you’ll divide that into a simple budget:

• 50% goes to needs.
• 30% goes to wants.
• 20% goes to savings and debt repayment.

That’s right — contrary to popular belief, you can still enjoy life and buy things you want while on a budget!

2. Pay Off High-Interest Debt First

Always make the minimum payments on all your loans, but prioritize putting extra money toward the one with the highest interest first. Use the “debt avalanche” method: First, list your debts in descending order with the highest interest rate at the top. Then, pay the minimum for each one, except for the one with the highest interest. Put more money toward the highest-interest-rate debt as quickly as possible. Once that debt is paid off, move onto the debt with the next highest interest rate until all debts are paid off.

3. Track Your Cash Flow

Everyone spends money differently. If you want to pay off what you owe, it’s essential to know where your money is going each month. It can help you find areas of improvement for reducing your debt and staying within a budget.

Tracking your spending will reveal areas where you can cut back to put more money toward debt reduction each month. Even small changes, such as making coffee at home instead of buying it every day at a coffee shop, can add up quickly to extra cash that you can use toward paying off debt.

4. Increase Your Income

This may be the most obvious tip to get out of debt, but finding a way to increase your income can be a big help. Things like starting a side hustle, working overtime, or downsizing into a smaller home that costs less are common examples of this.

However, more money doesn’t always equate to less debt: The key is to commit the same percentage or more, not the same dollar amount, to repaying debt. It can be difficult to not get carried away when you see a higher dollar amount in your bank account. You’ll still need to practice self-discipline to ensure your increased income makes a bigger dent in your debt than you were making before.

5. Create Your Own Get-Out-of-Debt Plan

Never underestimate the power and importance of a financial plan. Your get-out-of–debt plan should be tailored to your family’s unique situation and needs. Include the order in which you’ll pay off each debt, the amount of money you’ll put toward each one each month, and when you hope to have it paid off. This way, you can feel more confident moving forward.