3 Ways to Slay Your Debt Once and For All

I was so freaked out that I would be broke forever when I was 20 years old making 20k/year and in almost as much credit card debt. But, I got through it and so can you. And, I’ll tell you: if I can do it, being first-generation American and having zero knowledge of finance at the time, then anyone can do it!

The truth is, in order to build a strong financial foundation for your life, you have to tackle your debt. I know, it’s not fun–but you’re only hurting yourself (and future you) if you don’t. Ignoring it will get you nowhere. Regardless of how well you budget or save, if you have debt hanging over your head, you’ll have a hard time getting ahead with your money.

Chances are that you’re going to have more than one type of debt load to carry. The four major kinds of debt are credit cards, car loans, student loans, and mortgages. Get this into your head now: debt needs to be prioritized by rate. If all the rates feel jumbled, go back and check what the current rates are or the range for “revolving” debt (the kind for which payments vary from month to month) and put them in a list from highest to lowest to prioritize your plan of attack.

Here’s how to start slaying your debt, once and for all:

Prioritize:

Pay down the debt with the highest interest rate first, which is usually your credit card. This is because the interest will pile up most quickly on this kind of debt, and leave you paying more in the long run. Typically debt ranks in this order:

1. Credit cards: because they have the highest interest rates, i.e., this form of debt will add up the fastest.
2. Car loans: because a car is already a depreciating asset; no sense paying more interest on it as it decreases in value.
3. Mortgage: because your home is only a solid asset if you actually own it.
4. Student loans: because they are long-term debt and thus will eat into your retirement savings.

Remember, creditors can take away your car, your house, your stuff but they can’t take away your brain.

Set a schedule:

Make a timetable to pay off your debt and don’t drag it out! Schedule your debt payments to automatically come out of your paycheck each month so you don’t even have a chance to spend that money on something else. It doesn’t hurt as much if you never see that money in the first place. Give yourself a realistic timetable to pay it off, but don’t set comfy deadlines. Paying debt off isn’t a comfy thing. Don’t forget: the longer you drag it out, the more money you’ll be shelling out for interest. And again, just like a regular diet, you’re cheating yourself if you slack.

Get your rates down:

Call your credit card company and ask for a lower APR. Negotiate everything: medical bills, cable bills, and of course your credit card rate! Don’t accept the sticker price on anything. Creditors have an incentive for you to pay the debt back even at a lower rate, especially if it is “unsecured debt,” like credit card debt, since they don’t have any collateral to take if you don’t pay them back (unlike with “secured debt,” such as a mortgage, which is backed by something the lender can take away if you don’t pay them back (á la a house in the case of a mortgage). So try and try again. You might also qualify for a hardship plan, which could lower your rates or payments or both.

Paying off debt is the worst. I know, I did it, and trust me, I hated it. Putting aside a couple hundred bucks every month isn’t easy, especially when it feels like you’ve got nothing to show for it. But carrying debt will mess up your situation a lot longer, and that will be more painful than sucking it up and taking care of it now. Remind yourself of the debt-free life that you’re working toward–it’s more than worth it.

A version of this article was originally published on WomansDay