More For Your Money - University of Illinois Extension

Strategies to Control Debt

What can you do to control your debt?  Look at your different debts.  Which debt will you pay first?  Do you need to make changes to manage your debt well? Consider the following strategies.

Stop Spending and Borrowing Money

  • Cut back on spending.
  • Stop borrowing money.  If you have credit cards, cancel them.  Instead of using credit, either pay for things with cash or don’t buy them. 
  • Go on spending and credit diets.  Cut all of your living expenses to a minimum, and don’t buy what you don’t need.  Stop credit purchases until debts are under control.  Set a goal to maintain your spending diet for a month or whatever time period is appropriate for you.

Set-Up a Plan

Man and woman going over documents at a table.
  • Plan how you will pay off your debts.  Do you have bills that must be paid soon? Will something happen if you don’t pay?  Set up your plan to deal with these bills first.

  • Pay off loans or credit cards with high interest rates.  At higher interest rates, more of your monthly payment goes toward finance charges.  Quickly paying off loan balances with high rates can free up cash to pay other bills.  Or, perhaps you’d rather pay off loans that have small balances.  This will give you extra money to pay on the bigger balances.