My wife and I were previously in debt and struggling. We were living paycheck to paycheck and we have done everything dumb you could think of in the past to try and pay off debt. None of those other methods ever worked, even including borrow money at lower interest to invest it at higher interest as some have suggested.

First and foremost, you need to understand that your debt load is simply the symptom of a much larger problem and that is your behavior towards money and finances.

You cannot borrow your way out of debt, you cannot spend more than you make, etc.

First, grab a pair of scissors and then cut up all of your credit cards. Yes, I’m serious, perform plastic surgery on your cards, do it right now. I’ll wait…

OK, are you done cutting up your cards? If not go back and reread the last sentence until you have cut up your cards.

Look at all of your income sources then subtract off the four walls of your home in this order: food (no restaurants), utilities, transportation, rent/mortgage.

If you have no money left over then you have an income problem and you need to follow the sage advice of: “The only good place to go when you are broke is to work!”

To increase your income and get as much cash as you can, basically, go out there and work 80 hours a week, sell everything you possibly can because you probably have too much junk in the first place.

The money left over after paying for the four walls is the money you can use to pay off your debt. List all of your debts (except your mortgage) from smallest balance to largest balance. Pay off the smallest debts first. This is called the debt snowball and while it is not the mathematically smartest way to do it, it is the best psychologically. If you were doing math you would NEVER have been in this mess in the first place, so let’s fix the real problem.

Some will tell you to have 3–6 months of savings before you pay off your debts, I would advise you to have much much less than this. You should have no more than $1k-$3k saved up for emergencies until you are completely done paying off all of your debts (sans your mortgage). This takes most people 1–3 years to accomplish. I cannot state the relief you will have after getting this step done.

After you are done paying off all of your debts except for your mortgage it is now time to build up your emergency fund to 3–6 months of expenses. You should still be working 80 hours a week and you should have literally no life, continue this until you have saved 3–6 months of expenses.

At this point you will have no consumer debt and you will have an emergency fund, you will have cut up your credit cards and closed those accounts. You will now be able to start on baby step #4 of Dave Ramsey’s Baby Steps and I would advise you to listen to his radio show everyday for motivation to help you get this far.

Eventually you can join us and millions of others that are completely and 100% debt free, house and everything! I wish you luck on your journey and you can do it. It took us just under 3 years to go from paycheck to paycheck to being 100% debt-free. You can do this, just follow the plan and do not listen to broke people. Listen to those that have taken this path to eliminating all of their debt.