9 easy steps to the Darko debt payoff schedule


Have you ever felt the need to cut back on the amount of debt you have? Have you ever felt annoyed when debt collectors call you? Have you ever felt guilty about not opening your mail because you hate seeing how much you owe? Have ever used one credit card to pay off another credit card debt? Some of you might recognize this as the CAGE questionnaire used for alcoholism screening. Why use this questionnaire to describe problems with debt?

Well, as a society, we feel that we cannot live without debt. Debt impacts our lives, relationships, and emotions. But debt it is also about controlling behaviors. By no means are we goody- two-shoes experts on debt. We are in the middle of paying off a large amount of our own debt and would like to share with you the steps that we are currently taking to achieve debt freedom.

  1. Open the mail

    an inbox full of mail envelopes, clipping path included

    • Definitely been guilty of this! If you avoid opening the mail because you don’t want to see how much you owe, you will always be in debt and will feel even greater impacts of not paying your debts.
    • Get over that hump and open all the mail over the last month. It won’t hurt. We promise!
  2. Separate your monthly expenses from your debt

    • First, we differentiate monthly expenses from debt. Monthly expenses are those that you will always have to pay on a monthly basis. Rent, groceries, electricity, gas, heat, phone, water, internet, insurance, etc…  List all monthly expenses and add up the amount you pay each month. You might have to look at your bank statements for this step.
    • Debt is anything that has a set amount, but that you are paying for over time. Car, student loan, mortgage, credit card, store credit, etc… List all monthly debt payments. We know! It’s a lot, but stay calm and keep reading.
    • By the way, this is your first step in creating a budget. Congrats!
  3. Compare your take home income to your monthly expenses and debt paymentsdebt couple

    • Write down your monthly TAKE HOME income, the amount after taxes. If you get two pay stubs a month, then add up the amounts.
    • Calculate “take home” minus “monthly expenses”. Whatever number you have remaining is what you have to pay your debt.
    • If that “remaining number” is smaller than your “monthly debt payments”, then you probably have a spending problem. The good thing is that spending is a behavior that you can control. More about that below.
    • If the “remaining number” is larger than your “monthly debt payments”, then you have enough to pay down your debt faster!
  4. Admit that debt interferes with important things in your life

    • Say these words out loud.  “If I (we) didn’t have debt, I (we) could save for college, retirement, a house, and build wealth!”  Maybe you and your spouse will stop fighting over money.
    • They say that admitting you have a problem is the first step. That might be true for most things. For debt, sometimes seeing the numbers first helps bring the problem to light.
  5. Envision your life with and without debt (A must-do!)parents-fund-photo

    • With debt, you’re frustrated and anxious. You don’t pick up the phone or open the mail. You argue with your spouse. You worry that you can’t help your kids’ with college tuition, you can’t help your aging parents, you will be paying for that vacation for the next five years, and you will have to work well over age 65 because you have no retirement savings.  Average social security monthly payment is $1294. If you can’t live on what you make now, just wait until you hit 65!
    • Without debt, you’re comfortable knowing you owe no one. You answer your phone and open your mail without a care. You and your spouse plan instead of fight.  You can save for your kids’ college or help pay their loans if they already have them. You can help your aging parents. You can take another vacation. You can retire at age 65 or even earlier because you have way more than $1294/month to live on. Retire with dignity!
  6. Prioritize TOTAL debts from smallest to largest

    • List the total amounts owed on all of your debts from smallest to largest. Don’t include your mortgage/real estate in this list unless it’s your only debt. We agree with Dave Ramsey’s principle of paying off other debt first, then tackling a mortgage after you have enough saved. Use Dave’s awesome debt snowball tool to help you.
      • credit card A – $2000
      • credit card B – $3500
      • Car note – $11,500
      • Student loans – $30,000
  7. Make a budgetmoney-budget-960x500

    • In step 2 and 3, you began the steps in creating a budget. We recently started using the EveryDollar system. Check out our step by step video review!
    • Get serious about sticking to your budget. Figure out how you can cut your monthly expenses, even if just temporarily to pay off debt faster. For example, we cut cable and switched to less expensive phone and internet plans. We limited our grocery shopping to a set amount and we rarely eat in restaurants anymore.
  8. Commit to paying off debt fast

    • You have the evidence you need that debt is negatively impacting your life. Now get motivated to keeping your money in your possession! Change your behaviors around money. Cut up your credit cards and stop accruing more debt. Stop eating in restaurants. Wear that dress a second time; nobody on Facebook cares! Tell your friends you can’t go out every Friday night. Pick up some extra work for more income. Ask for a raise. Try to make more money.
    • Go back to your list in step 6. Pay minimum payments to the larger amounts and put that extra income towards the smallest debt. BOOM… $2000 gone! Then take the extra money and put towards the next highest debt. BOOM… $3500 gone! You see where this is going! We paid off our lower student loans first.
    • Setting a deadline might also help motivate you. Maybe it will take you 1 year, 3 years, or 7 years. Look at your numbers and set a deadline to be debt free! Our deadline is 3.5 years and we are definitely seeing progress! Again, Dave’s debt snowball tool can help you organize and set a deadline.
  9. Stick to the plan… TOGETHER!????????????????????

    • So important! If you are a couple, you have to do this together. As we get closer to our goals, our relationship becomes closer and stronger. We see a better life in our future! Support each other in sticking to the plan. Some couples go through Financial Peace University, which has gotten great reviews.
    • Remember that this is about your behavior! If you are naturally a spender, it’s not a character flaw. Let your spouse help you with spending habits. Don’t get discouraged or distracted. You have a goal for yourself, your family, your life. Decipher your wants from your needs. You need food, but you you want it from the gourmet restaurant. You need clothes, but you want a new dress when you have five perfectly fine dresses already.
    • The things you want in your younger years might take from you the things you will need in your older years. As Dave Ramsey says, “Don’t work hard all of your life just to be broke when you’re old.”

We hope these steps help you start your own debt payoff. Please feel free to leave us any comments or other helpful tips on paying down debt. Thanks for keeping up!


About Nii and Renee

A newly married couple in pursuit of financial peace, marital bliss, and career freedom!

Posted on May 24, 2015, in debt, marriage, money and tagged , , , . Bookmark the permalink. 1 Comment.

  1. Howto$tuffYourPig

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