Four Ways To Get Out of Debt in 2024 and Stay There

If you have a lot of high-interest debt, such as credit card debt, it can sap energy from your financial life. First, it takes a certain amount of your cash flow every month to pay the bill. If you didn’t have the debt, you could use that money for the achievement of other goals: saving and investing, retirement, vacations – you name it.

Second, though, the fact of debt itself can impede your long-range goal planning. Your goals can come to narrowly focus on getting out of debt, especially if you have a lot of it. All your other financial goals can come to seem much more distant. Once you clear debt from your decks, you can see medium-range and long-term goals more clearly, and begin to actively plan for them.

There are financial advisors in San Antonio, TX that can help make a plan to help you get out of debt such as the professionals at PAX Financial Group. Here are four of the best ways to get out of debt in the coming year.

1. Make a firm commitment to eliminate or pay down debt

One of the wearisome things about credit card and other high-interest debt is that it tends to just become part of our daily financial landscape if you don’t focus on it. So month after month, year after year, part of your income goes toward it, often without paying it off.

So the first step to take is to make eliminating or reducing your debt a financial goal for 2024. Plan actively that your debt will either be gone or amount to much less in 2025 and beyond.

2. Create a budget 

A budget is a necessary tool for financial planning. A budget is simply a record of your expenses and income every month, broken into categories. A budget is highly useful for many reasons, but one of the main ones is that it allows you to see where your money goes every month. 

Simply put, most people are in debt because they spend more than they make every month! That’s true of every income bracket. A budget allows you to examine your categories and see where you can cut down on spending.

If a review of your budget shows that you can’t reduce spending much, it indicates a need to put your energies toward bringing in more income. In any event, once you either reduce spending or make more income, allocate as much as you can toward debt reduction every month.

3. Choose the best debt reduction method for your situation

There are two basic ways to reduce your debt more quickly and strategically than simply paying the minimum due each month: paying off the highest-interest debt first or paying off the lowest amounts first.

Highest interest rate first: the debt avalanche

Paying off the highest-interest debt first is known colloquially as the “debt avalanche” method. Review all your sources of debt to see the various annual percentage rate (APR) each is charging. Credit card interest is often very high, and the higher the interest the more you pay for debt service every month. 

With a debt avalanche method in place, you put all available cash toward paying off the highest-interest creditor, to cut down on the interest you pay quicker. Once it is paid off, you put the money you were paying toward the next highest-rate creditor.

The smallest amount of debt first: debt snowball

Paying off the smallest amount of debt first is known colloquially as the “debt snowball” method. Review all your debt to ascertain the amounts you owe. A debt snowball can be helpful if you have some cards with smaller amounts on them. It can also give you a boost psychologically because debt snowballs on small amounts can show fairly quick results and eliminate the number of credit cards you have.

You choose the smallest amount of debt and devote as much money as you can per month to paying it. Once it is paid off, you take the money you were paying and put it toward the next lowest amount.

4. Consider consolidating your debt

Finally, consider consolidating your debt. Consolidating debt works in several different ways. First, it can help manage your debt payments more effectively. This can be especially helpful if you have many different creditors.

Second, you can consolidate your debt with a lower interest rate than you currently pay. The lower your interest rate on the debt, the less you will pay. The less you pay, the easier it will be to reduce your debt.

There are two major debt consolidation methods: transferring your balances to a low or no-interest-rate card and obtaining a personal loan.

Transferring your balances to a credit card

Many companies that offer credit cards offer an introductory period of low or 0 percent interest. You should shop around for an introductory period of at least 12 to 18 months if you want to transfer your balance in this way. 

This method works best if the amount of debt you are transferring can be completely paid off in the introductory period. But it can also work if the eventual interest rate in place after the introductory period is lower than what you currently pay. Be aware, of course, that if you don’t pay off the balance in the introductory period, you will be charged interest and monthly bills will begin after it’s over.

Obtaining a personal loan

Personal loans from a financial institution (bank, credit union, or loan company) generally have interest rates much lower than credit cards. Shop around at several different financial institutions to make sure you are getting the best terms possible. Terms include both interest rates and the length of the loan.

Working with a Faith-Based Financial Advisor in San Antonio, TX

At PAX Financial Group, we do faith-based financial planning based on the belief that our spiritual values should align with our financial plans. We are CERTIFIED FINANCIAL PLANNER™ Professionals who work with you to achieve your financial goals.

We can help you create and monitor budgets, reduce or eliminate debt, invest in a wide variety of assets, and plan for retirement in San Antonio. We also help clients with business issues, charitable giving, tax plannin, and estate planning. We are always happy to discuss your financial goals. Let’s talk.


This material is provided by PAX Financial Group, LLC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The information herein has been derived from sources believed to be accurate. Please note: Biblically Responsible Investing (“BRI”) involves, among other things, screening for companies that fit within the goal of investing in companies aligned with biblical values. Such screens may serve to reduce the pool of high performing companies considered for investment. Investing involves risk. BRI investing does not guarantee a favorable investment outcome. PAX Financial Group has conducted due diligence for their Biblically Responsible Investing (BRI) process and proudly serves as each client’s advocate using fully vetted third-party specialists for the administration of BRI methodology. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax, or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product and should not be relied upon as such.

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