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The Best Methods for Getting Yourself out of Debt

Carolyn is a stay-at-home mom and knows the struggles of trying to make money while still being there for her children.


Debt can often feel like a ball and chain around your ankle, weighing you down both mentally and emotionally. It can make you feel like a failure, cause you to lose sleep at night, and can even destroy your credit record.

It doesn't matter if it's student loan debt, credit card debt, or money you owe to friends and family, it's all debt. As I have learned over the years, there are many different ways to get yourself out of debt. One of these strategies may work best for your situation.

No matter how badly you are drowning in debt, there is always a way out. Take a look at these methods for getting yourself out of debt and find the one that works best for you.

Methods for Getting out of Debt

In reality, just Google the word "debt" and you will come across pages upon pages of websites offering their advice on how to get rid of debt. Some of that advice will cost you, most of it is free. Can you say overwhelming? I know I found it daunting and confusing too. Where do I begin? Which advice is best?

I've taken the methods from some of the more popular experts on the subject of getting rid of debt to make it a little less confusing and because their advice is solid. They are:

  • Rich Dad/Automatic Millionaire Method
  • Gail Vaz-Oxlade Method
  • Mary Hunt Method
  • Dave Ramsey Method
  • Suze Orman Method

The differences between each of these methods is rather minuscule. What makes each method for getting out of debt different is where they put the most emphasis in their plans and, if you are reading their books, the way they explain things. It's all about what you feel comfortable with and what works best for you.

What These Methods Have in Common

As I mentioned earlier, most methods for getting yourself out of debt have much of the same advice with some slight variation. The advice that most experts have in common are as follows and should be considered necessary:

  1. Stop spending or stop digging yourself further into debt.
  2. Put as much distance between you and your credit cards as possible. Cut them up, put them in the back of your freezer, basically pretend you don't have them anymore and stop using them. This also means stop accepting or applying for new credit cards!
  3. Renegotiate the interest rates on your existing credit cards to get a lower interest rate.
  4. Consolidate your credit card debt if you have more than one credit card that you are carrying a balance on.
  5. Establish an emergency fund of cash. The amount varies here but most experts suggest a minimum of $1000. It must not be tied up in any investments that will not allow you to access your money in 24 hours.
  6. Make it a priority to get yourself out of debt.

The Rich Dad/Automatic Millionaire Method

The reason I lumped these two together is not so much because their methods are the same but because their focus is the same. Pay yourself first, even if you are in debt.

I found the Rich Dad method interesting because it seemed to fly in the face of what most of the other "experts" out there were telling me with regards to getting myself out of debt. Despite drowning in debt, Robert Kiyosaki, in many of his books, strongly advocates to always pay yourself first, put your money into assets, and then pay your bills/debts with what is leftover. Of course, when he and his wife Kim did this, they were essentially each working two jobs or working as much as they could to be able to afford to pay themselves first and still be able to pay their bills.

While the Rich Dad method seems to fly in the face of reality, he does have a valid point with regard to paying yourself first no matter what, and that is, if you always put all of your money towards paying your bills/debts, you lose valuable months, even years that could help you start building your nest egg. You may also never get around to putting money aside into assets.

The Automatic Millionaire method is very similar. David Bach puts emphasis on paying yourself first as well (based on your gross monthly salary) with more emphasis on making these payments to yourself automatic, of course. The Automatic Millionaire method differs from other methods with regard to creating a budget. Many experts advocate budgeting your expenses. His method works well for those of us who despise budgets (as I do).

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After paying yourself first (based on your gross income) and taking half of that money to put towards debt repayment, you basically have the rest of your income to live on for the month. The challenge to not overspend that money and force yourself to use credit to get by because you fell short.

Where he differs from Rich Dad is his method involves taking that money that you would pay yourself first with (whichever percent of your income you are able to afford, 5%, 10%, etc.,) and splitting that in half. Save half of that money and use the other half to pay down your debts.

The Automatic Millionaire method also includes something called DOLP, which stands for Dead On Last Payment. This method is recommended for people who are unable to consolidate their debt due to bad credit or other issues. The idea behind DOLP is to get rid of your credit card debt once and for all.

DOLP works as follows (taken from The Automatic Millionaire by David Bach, 2003 pages 180-183):

  • Make a list of the current outstanding balances on each of your credit card accounts.
  • Divide each balance by the minimum payment that particular card company wants. The result you get is that account's DOLP number. For example, if you have a Visa balance of $500 and the minimum payment is $50, by dividing the total debt ($500) by the minimum payment ($50) gives you a DOLP number of 10.
  • Once you've figured out the DOLP number for each account, rank them in reverse order, putting the account with the lowest DOLP number first, the one with the second lowest number second, and so on.
  • Take half of the money you would pay yourself first with and apply it to the card with the lowest DOLP number. For the other cards, you make only the minimum payment.
  • Make it automatic.

Sample DOLP Chart

Account Outstanding BalanceMonthly Min. PaymentDOLP #DOLP Ranking











Sears Card 






The Gail Vaz Oxlade Method

The best way to describe the Gail Vaz Oxlade method of getting out of debt is the all-or-nothing approach. Regardless of how much you owe, if you don't make plans to have your debt paid off in three years or less, then you're not serious enough about getting out of debt. Gail argues that if you take longer than three years to pay off your debts, you most likely will never get yourself out of debt. Almost the opposite to what Rich Dad argues, but focusing on rapid debt repayment instead of paying yourself first.

Gail also believes in putting money aside for emergencies, but unless you have the wiggle room with your money, to start putting money into investments (usually she advocates RRSP's) once your debits are paid off, use the money you would normally put towards debt repayment into RRSP's instead.

Her reasoning behind this method is very similar to what others argue and that is, there is no point in putting money into investments that give you a 5% return when you have credit cards with a 19% or higher interest rate.

Gail's method for getting out of debt includes a two-pronged approach. You can either cut your variable spending, increase the money you bring in or do both. The best approach is to do both, but sometimes circumstances do not allow for this.

She also pushes for creating a budget for your monthly expenses, tracking your spending by writing it down and learning to live off cash via the money jars. That's right, no debit cards! If you don't have the cash for it, then you won't be buying it. Some people enjoy this method of tracking expenses and learning to budget their money. But it's not for everyone.

She is a strong believer in debt consolidation. She firmly believes it is a way to save bags of money because your debts are pulled together into one debt with a lower interest rate. "Consolidation is important because people are often paying too much interest on their debt," Vaz-Oxlade says. "It's also important for people who don't know, or can't seem to manage to pay their bills on time", she adds, as stated on her website. By debt consolidation, she is not referring to debt-consolidation companies, but instead, speaking to a financial advisor and finding out your options such as a low-interest line of credit or loan.

Gail's Sample Budget Binder Page

 Food Weekly Budget: $100 

Start of the first week: 

















Personal Care




New Week



The Mary Hunt Method

Mary Hunt wrote a book called Debt-Proof Living in which she discusses how to live financially free. In this book she deals with debt repayment and becoming debt-free. She also has a website called Debt-Proof Living but unlike most of the other experts listed, you have to be a paid member to access any information on this website, not cool in my books, but that's how she's operating these days.

In Mary's method, she approaches debt from a Christian perspective and to truly overcome debt, she believes it necessary to change one's outlook on money and debt and bring it in line with a more Christian way of living one's life. This involves being good stewards of the money God allows us to have in our lives. Her book does not deal only with debt, but with many other issues that can get in the way of living a financially free, Christian lifestyle.

Mary Hunt's method of getting out of debt includes something called Rapid Debt Repayment, although that is only part of her method for becoming financially free. The rest of her method includes a somewhat complicated plan for setting up various bank accounts and investments for emergencies, investments and something she calls a "freedom" account. Basically it's just a fancy name for the snowball method of debt repayment but she makes it sound so much more complicated and therefore feels the need to charge you for a membership to her website just so you can access her Rapid Debt Repayment tools.

The four RDR rules are as follows (taken from Debt-Proof Living by Mary Hunt, 1999, pages 88-89):

  1. No more new debt.
  2. Pay the same amount every month disregarding the declining minimum amount due as stated on the monthly statement until that debt is paid.
  3. Line up your debts according to size, putting the one with the shortest pay-off time at the top and the one with the longest term at the bottom.
  4. As one debt is paid, take that payment and redirect it to the regular payment of the next debt in line.

While I will not go into any specific details about her Debt-Proof Living formula, seeing as you need to be a paid member to access any of this kind of information on her website and I do not wish to get into any trouble, I will just briefly mention what this method includes and you can decide for yourself if you wish to pay to find out more or buy her book.

The Mary Hunt Debt-Proof Living Formula:

  • Give away 10 percent- also called tithing. It is up to you where you wish to donate.
  • Save 10 percent- net income and work up her 4 levels of savings; Level 1- A Contingency fund for emergencies, Level 2- Building your Freedom account (to be done at the same time you are building your Contingency fund), Level 3- Turbocharge your Rapid Debt-Repayment Plan and when you are debt-free you get to move on to Savings Level 4- exploring your options with all your new money!
  • Live on the remaining 80 percent of your net income- requires reducing your living expenses (hence she is known as the Everyday Cheapskate).
The Snowball Method

The Snowball Method

The Dave Ramsey Method

The best way to describe Dave Ramsey is that is he is the Judge Judy of debt and finance from a Christian perspective. If what you're doing is stupid, he will pretty much tell you to your face, no holds barred. At the same time he is an advocate for teaching others how to be financially responsible among many other subjects. He offers a wealth of information via his radio program, website articles and online classes (not free). You can also learn from the many books he has written such as The Total Money Makeover which is highly recommended for anyone wanting to get out of debt.

One of the methods of getting out of debt that Dave Ramsey promotes is something called the "snowball" method.

The principle behind the snowball method of getting out of debt is to focus on one debt at a time and when that particular debt is paid off, move on to the next one until they are all paid off beginning with the smallest debt, paying no attention to the interest rates.

The Snowball Method:

  • Set up an emergency fund with $1000 to begin with.
  • List your debts beginning with the smallest balance first (ignore the interest rates unless you have 2 debts with the same balance, then pay off the one with the higher interest rate first).
  • Pay off the smallest debt first then take the money you put towards that debt and shift it over onto the next debt to be paid off until they are all paid off.

What Dave does not go into detail on his website with regard to the snowball method is how much of your income you should be putting towards paying off that first debt. I am not a paid member or have participated in any of his classes, so it's possible that this information is explained there.

The snowball method is very effective because it's easy to understand and follow by just focusing on one debt at a time. It is also very powerful psychologically because it feels really good when you pay off a debt and keeps you motivated to continue becoming debt-free.

Dave Ramsey is also a firm believer in paying off all your debt before investing your money.

The Snowball Method

Debt Balance Rank Monthly payment









As much as you can afford

The Suze Orman Method

SuzeOrman's method is very similar to the snowball method of paying off your debts but she emphasises paying off the first debt that has the highest interest rate, regardless of the balance.

She firmly believes in renegotiating for the best interest rates, even if it means switching credit cards every six months. She doesn't mention what this will do to a person's credit score by constantly switching credit cards, but it would seem lower interest rates are more important.

Part of her method involves fully understanding just exactly how credit cards work, the fees, the grace period, etc., ignorance is no excuse to her.

She also advocates honoring all debts equally, whether it is to Visa or your brother.

When it comes to debt consolidation Suze wants you to do whatever you can on your own and not deal with debt consolidation companies if at all possible. This includes calling the credit card companies and negotiating directly with them as well as with collection agencies because they both would rather have something instead of nothing and this will cost you significantly less than dealing with a debt consolidation company which often charges $700 or more upfront in fees.

Gail Vaz Oxlade has the opposite opinion and promotes debt consolidation as a means of saving bags of money.

Working towards becoming debt-free

Working towards becoming debt-free

The Bottom Line

In the end, it's all about finding a method that works best for you. Whether the focus is Christian living, or getting out of debt as quickly as possible for example, you need to find a method that works best for you. The advantage of following one of these methods for getting out of debt is that you don't feel that you are going at it alone. Many of these experts have people who can answer your questions or you can contact them via email, have a wide range of resources available (some free, some not), and a chance to connect with other people who are also struggling with debt.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2011 Carolyn Dahl

Tell Me What You Think!

Emmanuel Lempuris on April 28, 2020:

Hello Madam.

Thanks for taking your time to read my email. I really have a debt of ksh. 1,500,000/ it has become a burden in me, please help me to clear completely.Thanks in advance.

best regards,

Emmanuel Lempuris

BODYLEVIVE from Alabama, USA on April 23, 2020:

Hi there, you certainly got the right photo here. Great article, useful too. Thank you

Dominique Cantin-Meaney from Montreal, Canada on January 05, 2020:

I first heard of Gail when I was in university, when I saw her show 'Til Debt Do Us Part. I've enjoyed her shows since. I've always been a fan of hers.

Haley Kieser from Arizona on February 09, 2018:

The charts in your article are a great touch. Overall organization to the article is very well done. I recently have paid off $13,000 of student loans in 8 months. It takes more planning and determination than anything. You have to be able to say 'no' to some things. Also, a second form of income should always be present! We all don't need to be entrepreneurs, but we should all have some sort of side hustle.

Kenya Averette from Detroit, MI on November 14, 2017:

Great information. I will have to refer back to this article because it has so much information I need! Thank you!

Michelle Dee from Charlotte, NC on December 14, 2013:

Around the year 2000 I bought Mary Hunt's book and tried the rapid debt repayment and also set up a Freedom account. However as time went on I realized it was easier for me to keep everything in one account rather than setting up a second account. I took her advise and once the smaller balance was paid off I took that amount and applied it to the next balance and eventually all debts were paid. It really is true that you MUST stop using the credit card if you want to get out of debt.

I have been debt free for 8 years now, except for mortgage, and it's a great feeling. It allowed me to save an emergency fund and save for retirement. I only pay with cash now. It's amazing how much "stuff" I really don't need to buy. Great and thorough article, voted up and across.

FlourishAnyway from USA on September 18, 2013:

I like that you provided all of the advice together. While I am personally a big fan of both Suze Orman and Gail Vaz-Oxley, it is interesting to see how others' perspectives compare. Thanks for the information!

Carolyn Dahl (author) from Ottawa, Ontario on December 27, 2012:

Thank you for the feedback! I know personally how devastating debt can be on a persons life and sometimes different methods work better for different people. I for one am not much for the whole budget thing, but it may work for other people. Thanks for stopping by!

jdcedeno from Houston, TX on December 26, 2012:

Great hub. So nice to have all this information in one place. I'll definitely be referring back here as I try to decide what approach to take

Kas from Bartlett, Tennessee on December 26, 2012:

Very thoughtful Hub. I think there are definitely more people out there discovering how horrible the ball and chain of debt is. I've thankfully been out of debt for years. Don't want to go back. But I felt that crushing weight. Great hub, useful, and voting it up!

collegedad from The Upper Peninsula on December 26, 2012:

Wow! Well done! There is nothing worse than debt yet we are raising generations of debtors. Voted up!

Carolyn Dahl (author) from Ottawa, Ontario on November 13, 2012:

Thank you Denise! Much appreciated!

Denise Handlon from North Carolina on November 12, 2012:

Well, I think this is a wonderful hub and incorporates key points and your thoughts on the pros and cons of each. Financial stability is so important and so easy to lose, especially in this precarious economy of ours. Well done. Interesting, thorough, and very useful. Rated UP/U/I/A and sharing.

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