Skip to main content

How to Live Debt-Free

Credit cards, car payments, and student loans hang over the heads of many Americans. You can be free of debt and still live comfortably. Follow some simple steps and stop writing IOUs.


  • Step 1: Find ways to make more money so that you can live the way you want to live. No matter how many possessions you have, you'll never be able to fully enjoy them with debt hanging over your head. Enjoy your life debt-free!
  • FACT: In 2010, the average American had about $4,500 in credit card debt.
  • Step 2: Pay what you can every month to all your creditors. You'll save yourself money later in interest charges by paying off a debt sooner.
  • Step 3: Reserve plastic for emergencies only. Using a credit card for everyday expenses, or to pay your bills, can get you in big trouble. Stick to cash. Never carry a balance on a credit unless you have no other choice, and focus on paying it down as soon as possible.
  • Step 4: Draw up a budget and stick to it. Spending more than you make is how you get into debt, period. To avoid this pitfall, you need a plan about how you're going to spend what you make.
  • Step 5: Save, save, save. You never know when a huge financial burden will present itself, such as major car repairs. Save a stash for such rainy days by automatically deducting a small, preset amount from your paycheck each week and depositing it into a savings account.

Popular Categories