If you’re looking for strategies to pay off debt, you’re not alone. The average US household debt is a staggering $155,000.

I talk a lot about mindset in the process of creating Indestructible Wealth, and when it comes to strategies to pay off debt, the right mindset is huge. Paying off debt for unnecessary purchases is something we’ve probably all had to go through, and it’s a learning experience that really everyone should have. It can actually teach you a lot about yourself and instill discipline into your future financial life if you approach it the right way.

We’re going to discuss some alternative strategies to pay off debt below. I’m not the only one to ever have made these suggestions; my particular special sauce is to teach you how to think about getting out of debt so that when you make a plan, you will actually stick to it. And at the end of it, you will come out better, more mature, and more ready to begin creating the multiple streams of income that will lead you to Indestructible Wealth.

My strategies to pay off debt are outlined below, and a more detailed explanation and discussion can be found on episode #5 of my podcast.

Understanding Your Debt

Before we look at strategies to pay off debt, let’s make sure that you understand the type or types of debt you have. Some types of debt can actually work in your favor, such as the money you borrow to invest in real estate, which allows you to build wealth over the long term with very little risk and very little investment of your own capital. Unsecured debt, such as credit card debt, however, is death. Let’s look at the difference.

Secured debt: Let’s say that I owe $35,000 on a car that is worth $40,000. I have no problem with that debt, unless of course I had poor credit when I took out the loan and have a very high interest rate. But if I have a reasonable interest rate on my car loan, I will know that I can get a much higher return on the money I could use to pay off that loan. So I put that money towards smart investments and simply make my monthly car payment. I leave that type of debt alone.

With secured debt, I know that if my circumstances change (I can’t afford to pay for that item anymore or simply don’t want it), I can liquidate the asset quickly because the debt is collateralized.

Unsecured debt: Unsecured debt is a different story. Let’s say you made an impulse purchase or a luxury purchase on your credit card. Now you are paying 12 or 17 percent on that purchase for a year or two or five. That vacation or new entertainment system was expensive, and it keeps getting more and more expensive as each month goes by—and as its value decreases at an extremely high rate (or in the case of the vacation, there is no resale value at all).

How Much Debt Do You Actually Have?

If you’re truly ready to execute on your debt payoff strategy, you can’t avoid figuring out YOUR NUMBER any longer. So grab your credit card statement, your loan statements, and your bank statement (and maybe a beer or a glass of wine), and lay it all out for yourself. Include everything. Your car payment, student loans, credit cards, personal loans, and medical debt. Even that $400 you had to borrow from your parents six months ago. Lay it out in all its gory detail.

Create a Budget

The next step in your debt payoff strategy is to create a budget. And the most important thing in creating a budget is to find a method that you will stick to. If tracking every dollar you spend is empowering for you, there are apps like Mint that will help you to do so. If too much micromanagement makes you feel trapped, then just set aside a fixed amount for financial obligations and savings and spend the extra on what you want, realizing that once it’s gone, it’s gone.

To stick to your budget, try using the envelope method. Let’s say you have $1500 per month left over after making your monthly debt payments and your mortgage or rent payment. With this money, you need to buy groceries, gas, and discretionaries. I recommend taking that $1500 out of the bank every month and dividing it into multiples envelopes: one for weekly groceries, one for weekly spending money, and so on. There’s something about holding the cash in your hands that helps you to understand the limited amount of money that you have. When you spend it, it’s gone. That fact becomes quite clear when you use cash, making you question whether you truly need that item you’re about to buy.

Debt Payoff Strategies

The next step is to decide on a strategy to pay off your debt. In a year or two, you may decide that you want to change the strategy you’re using. That’s fine. But for now, we’re going to stick to one of these methods for at least the next six months.

The Snowball Method

For the Snowball debt payoff strategy, list all of your debts from smallest to largest (exclude your mortgage from this). Then, you’ll make the minimum payment on all but the smallest debt, which you will pay off as rapidly as possible. Let’s say you have 3 credit cards with debts of $500, $1,000, and $1,500 respectively. You also borrowed $3,000 to buy a computer and are making separate loan payments on that. Plus you have a car loan with $20,000 left on it. Make all the minimum payments on each outstanding debt except for the $500 credit card. If you can get together $200 per month towards paying off that bill, it will be completely paid off in three months, and then you can move toward the next credit card, adding the $200 per month to the minimum payment on that card. This approach leaves you with a sense of accomplishment and motivates you to keep going.

The Avalanche Method:

For the Avalanche debt payoff strategy, you make minimum payments on all debts except for the one with the highest interest rate. For that debt, you will apply any and all money you can find in your budget towards paying it off. So in the above example, if your $1,500 credit card has the highest interest rate among all 5 debts at 18 percent, you would pay that debt off first to save as much as possible in interest fees, and then move on to the next highest.

Which debt payoff strategy you choose depends on a number of factors, including how much money you have per month to pay off debt.

Finding the Cash to Pay Off Debt

Whichever debt payoff strategy you choose, finding the money to pay off the debt is usually the part that people dread. I’m here to tell you that cutting expenses—trimming the fat that you don’t need—is empowering and liberating. If you turn it into a game, it can also be fun.

Recurring monthly expenses can be a total money pit. Before you’ve even spent a dime at the beginning of the month, you probably owe an ungodly amount to your cable company, monthly subscriptions on any number of apps, a gym membership, your monthly phone bill, and the list goes on.

How many of these expenses are really necessary? How many of them do you scarcely use over the course of the month?

So one way to find money is to cut out some, even most, of these recurring fees. You need your phone, so let’s not touch that one. (But do you need the latest iPhone whenever a new one comes out? Please, please say no.) Cable is one of the easiest things to cut out of your life. Most TV is garbage anyway, right? And if you’re paying for HBO, Netflix, Hulu, and any other entertainment apps, kick them to the curb as well. You have better things to do than binge watch shows anyway.

Or maybe you have a high-priced gym membership. A state-of-the-art gym may be convenient, and it can even be a status symbol of sorts. But you can get in shape outside or in your own living room, where you can choose from untold thousands (maybe even millions) of YouTube workout videos for free.

Learning the art of positive self talk is going to be the key to winning this battle. Alternative strategies to pay off debt really begin in your mind, so that’s what we’re going to address.

When you give up cable and entertainment apps, you may have bought yourself multiple hours in the day. You haven’t lost anything; in fact, you’ve gained something that money can’t buy, and that’s time. What are you going to do with that time? Start a side hustle? Volunteer in your community? Learn about crypto investment strategies? Make time for the workouts you “never have time for”? Any of these are quite literally money in the bank for you. Even if you don’t have the money to invest in crypto now, once your debt is paid off, you will. And by then, you’ll have the skills to do it. The point is, turn cutting expenses into wins, and you will find that you’ve created so much more than the trivial things you’ve lost.

More Debt Payoff Strategy Tips

Make it visual: When you pay off a debt, give yourself a visual way to cross it off your list. Put all your debt obligations on a cork board and remove them once the debt is paid off. If you need 18 months to pay off your credit card in $110 increments, cross off each payment the way some people cross off days on the calendar. There are debt repayment apps that give you the same visual representation and satisfaction every month. This visual reminder will motivate you to keep going.

Stop waiting: Now that you’re saving time by giving up binge watching or driving to the gym, what are you going to do with that time? How about creating additional income from a side business so that you can pay off your debt faster than you thought possible? Don’t make any excuses here. You can always find work on Fiverr or Upwork, delivering pizzas, cleaning houses, teaching a sport or musical instrument…whatever you need to do, do it. And keep in mind that this side hustle could well become an income stream in the future. Think of your debt payoff strategies as opportunities rather than as something you dread, and you will already be setting the stage to create more success, more money, and to pay your debt off that much quicker.

Never use a credit card again: You heard me. Never. Ever. How can you expect to get out of debt if you keep getting into debt?

Negotiate with your creditors: It never hurts to ask, right? As you pay down your debt, you may qualify for lower interest rates on your car, for example, as your credit score improves. Don’t underestimate the impact that saving $20 or $50 or $100 dollars a month in interest payments can have. Keep on top of all your loans and request lower interest rates periodically. Also keep an eye out for credit card offers that allow you to transfer balances at a lower interest rate. Successful debt payoff strategies rely on incremental gains, and small savings really add up.

Follow Me for Alternative Strategies to Pay Off Debt

Every week on my podcast, we talk about all the different ways to build Indestructible Wealth, including investment opportunities, creating multiple streams of income, and alternative strategies to pay off debt. The way I see it, if you’re not listening to me, you’re leaving money on the table. Don’t make that mistake. Listen to my podcast here or check me out on platforms like Spotify and Apple podcasts. You’ll learn about debt risk management and strategies to pay off your debt fast so you can get started on building real wealth for now and for your future.