François Bégin

By François Bégin

November 3, 2016


5 Tips for Getting Out of Debt Once and For All

Article revised on 3 May 2018

It’s not always bad to have debts. Some debts, such as mortgage loans, can prove to be useful. The problem with other types of debts, such as loans for purchasing furniture or household appliances, is that they are “easy-come” but not so “easy-go” due to high interest rates.

Luckily, there is a way to get out of debt, but I wouldn’t call it a miracle solution. Instead, I’d call it a recipe for eliminating your debts one by one, for good.

My 5 tips for getting out of debt

1. Take some time to do a balance sheet of your current financial situation

If you don’t know where to start, take a look at my article: “Personal finances: Where to start?“!

2. Try out a budget

If you are among the 53% of the population that does not have a budget, you should read my article “Can making a budget be fun?“. Beware, you might actually enjoy making it!

My advice
If you want to leave the past behind, make sure your budget is balanced and that you follow it as much as possible.

3. Invest in your debts

Yes, you read that correctly! Imagine for a moment that paying back your debts is an investment. This is a concept that made a big difference in my life. I stopped becoming discouraged when I thought about my debts. The basic idea is that the quicker I finished “investing” in my debts, the quicker I could invest the money elsewhere.

4. Pay back debts that have the highest interest rates first

Always reimburse your debts, such as credit cards, lines of credit and personal loans, in order of the highest interest rate to the lowest. If you are very indebted, don’t pay off your mortgage quickly; focus on your consumer debts, and pay them off as quickly as possible.

5. Use systematic savings products

Even if you are in the process of paying back your debts, I advise you to continue saving money (between 5% to 10% of your net income) to deal with unforeseen events and any expenditures that are not part of your budget. This way, you become your own creditor, and you’ll no longer need loans to handle unexpected needs or to make your dreams come true.

Bonus tip (and probably the most important):

Above all, don’t take on more debt! Stop and think about what you already have in life. Before spending more money that could put you further in debt, ask yourself if you really need it. I’m betting the answer is “no.”


Don’t miss my next article “The Big Credit Card Trap“. You’ll save a ton of money!

Start saving now!

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