How to Get Out Of Debt (Even On a Lower Income)

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How do I get out of debt? This is a question many people have. The reason plans fail is due to a failure to plan.

Learn How to Get Out of Debt - Even on a Lower Income. Even if you do not make a lot of money, you can still dig out from under your debt.


Most of us have probably read or heard  those all inspiring stories about families who were on a single income and still somehow managed to get out of debt in a matter of months!  You are probably nodding your head with me and thinking that as much as you’d love to do it, you don’t see how that is attainable.

My husband and I were living on one income when we decided it was time to get out of debt.  It took us about 2 1/2 yrs, but we ended up paying off $37,000 in debt during that time.  There are countless other stories of our readers who have paid off similar amounts in even less time.

I am here to tell you that you CAN (and should) get out of debt – no matter how little money you may make!!

How is this even possible?

I am going to share the steps anyone can follow to learn how to actually get out of debt – no matter your income level.  If you struggle to make ends meet, you already know how to make the most of a dollar and I’ll give you additional tips so that you can actually pay down that debt.

I have asked this on Facebook all of the time and some of the comments include:

“There is no way I can do this. Not with my medical bills.”

“Sure, that only works or some people – not me.”

Many of you may be I thinking similar things and I completely understand that way of thinking. I was there myself and know that it seems like an unattainable goal.  That is why you are reading this right now – to find out how to make this dream a reality.

Debt is NOT a Good Thing.
If you are in debt, it could be because of a your own decisions or even those you can’t control (such as health, job loss etc).  No matter how you got into debt, you need to get rid of it.

The reason you need to eliminate your debt is that it truly is holding you back. How can you move forward financially with debt in your way?  If you found that you needed to buy a new car, you would find a way, correct?  For most, that would probably mean an additional monthly payment – but you would do it because you needed to.  You need to look at debt the same way:

“Getting out of debt is not a desire – it is a need.”

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If you are struggling  with paying off your debt, these folks may be able to help:  Call 866-948-5666.


My Own Personal Story

I remember in 2009, when my husband and I thought the same thing.  At that time, I was not working at that time and so we had one income and two young children to feed.  I initially thought that there was no way at all that we could do this.  It was just not possible.

We started by looking at our finances (oh – they were awful).  Our goal was to live a great life.  We could have kept on and kept just getting by, but that was not how we wanted to live or lives.

Knowing our kids would be watching us, we wanted to teach them out to life a great life too – without debt.  They now see this in our spending and know that we do not use a credit card.  We pay for it all with cash (a lesson which will serve them well during their lives).

In that moment it was when realized that not having debt was pivotal in having a positive financial future.  This was true not only for my husband and I, but also our children.  It was also an important piece in our marriage.  We needed to remove anything that could potentially cause stress – money and finances being a big one.  Our marriage was good, but we knew we could even make it better.

To begin our journey, we read Dave Ramsey’s Total Money Makeover. We’ve been debt free since 2012 and it feels so amazing!  Our own journey took us a bit more than 2 years – but we did it!!!

Yes, I know, that is the simple part.  Deciding to make a change is definitely needed, but the bigger issue is how in the world can we do this when our income is stretched as thinly as it is.

You might be saying that you can’t do that though.  I’m here to say that you can – when you really, truly want to make it happen.


Like I said above, knowing that you want make the changes and actually pay off your debt is only one small part.  The bigger issue is how in the world you actually can do this.  I’ve got the tips you need to know in order to get started.


1 – Face Your Own Reality

According to CNN Money, the average American family made $53,657 in 2015.  While that is the average, it is also true that many Americans make much less than this.  With a lower income it is even more important that you have no debt at all.  I mean, you are already stretching every dollar to cover your bills, you definitely do not need to include additional payments to hit your budget.

Unless you win the lottery, a rich relative leaves you a small fortune or you find a better job, you know your income won’t change.  That is the truth. You can’t change that.

However, what you can and must do is take the steps you can to work yourself out from under the mountain of debt you may be facing. We will teach you about how to create a budget, determine how much debt you actually have and then how you can actually pay it off – even if you do not make much money.


2 – Fully Commit

If you are not 100% ready to make changes, then you are destined for failure.  I hate to sound so blunt, but it is true.  If you can’t “go all in” and fully commit to making whatever difficult changes necessary (trust me, they will be very difficult), then you need to just stop reading right now.

If you are ready to make this lifestyle change, then read on. You’ve already made huge strides to making changes in your life.


3 – Create (and use) a Budget and Debt Snowball Form

This is paramount to getting out of debt.  Without your budget, you can’t even consider getting out of debt.   It is the very first thing you need to do.  We’ve actually created an entire post to help you learn about budgeting – even if you have never used one before.   It is not difficult, but it can  (and will) be very eye opening. You will also need to create a debt snowball – so you can actually see your debts and learn HOW you will tackle them.

I always say to look at paying off debt like a football team.  Each part of your finances is involved in the game:

Home Team – This is you and your family
Visiting Team – These are your debts and expenses
Your End Zone – This is where you will be debt free
Play Book – Budget and debt snowball forms
Football – Your money
Refs and Penalties – Unexpected instances which set you back in reaching your goals

You would never expect a team to run onto the field and play the game without having plays in mind.  If everyone of the members of your family has a different idea as to how to get your money down the field to pay off your debts, you will never make it there.

Instead, you design smart plays and work together to get there.  You work to get your money past all of the expenses you need to dodge.  There may be setbacks and you may have to move back before you can get forward.  However, with hard work, you will get there.  You will get onto the scoreboard – and end up claiming victory!

Without a financial plan you can’t go forward.  We’ve created forms you can use (free of charge) to help you tackle each financial issues.  We’ve even included additional details to help you complete each form:

How to Create a Budget (Even If You’ve Never Had One Before)
How to Use the Debt Payoff (aka Snowball) Form to Get out of Debt

How to Create and Use a Cash Budget (Never Use Credit Card)

I always recommend you keep your debt pay down form printed and hung where you can see it.  It will be a constant reminder of your goals and what you are working towards achieving!  Best of all, when you pay off a debt, you get to cross it off of your list!!  There is nothing like seeing progress in front of your eyes!!


4 – Find extra money

Before you jump in to try to pay off debts, you really need to have savings.  The reason is that if an emergency comes up, you need to pay for it – in cash.  You do not want to run to your credit card to cover the expense.  It is really best to have at least $1,000 in the bank before you get started.

So, before you jump in to pay off those debts you listed above, make sure you’ve got money in the bank to cover your unforeseen expenses but Creating an Emergency Fund.

Once you have that done, then you are going to have to find a way to squeeze everything you can out of every cent.  For some it may mean no longer dining out.  For others it could be shutting off cable.  Where there is a will, there will always be a way to make this happen.  You just have to do what you can!

I share this true story in our budget post, but I’m putting it here again for you!  My husband and I gave up dining out. No joke. We ate dinner out very infrequently.  While I look back and think it might have been once every couple of weeks, I asked my husband recently and he said that we were lucky to eat out once a month! It was so difficult, but now that we’ve cut down out all of our debts, we have income freed up so we can have dinner out more frequently (if we so desire).

For even more inspiration and ideas, you may have to find some radical ways you can get cash to help you get out of debt.  Do whatever it takes (legally and within reason, of course), to help you get out of debt.


5 – What if I’ve Saved All I Can – But that Still Doesn’t Help?

To be totally honest, if you are struggling to make ends meet on a low income you won’t be able to just cut enough out of your budget to pay off your debt.  Like my mom use to say – “You can’t get blood out of a turnip” – which basically means if it isn’t there – there is nothing you can do about it.

That is the truth and I’m not trying to lie to you. I am realistic and know that if you are making barely enough to cover your expenses, you won’t have any extra money for your debt.  I get that.

You can’t save enough money on your budget to totally eliminate your debt.  Well, I guess you could, but that is going to take a very, very, VERY long time.  So, what do you do when you’ve saved all you can and still can’t pay off your debts?  Well, you just have to get creative.

For some this may mean finding items that are no longer needed which you can sell to raise money.  When we did this step, we had the same issue.  We could not really cut anything more from our budget.  For us, this meant selling items we no longer needed. We did a huge clean out and got rid of furniture and other things we were keeping “just in case.”  By doing this, we were able to come up with several thousand dollars — 100% of which went immediately towards our debt.

If that isn’t an option, you might want to consider getting a second job or side business to bring in income to truly help you get out of debt.  We also did this. I started my website.  Now, let me be Frank in saying that this is not a great way to make money.  Most blogs make little to nothing in the first couple of years.  I was lucky and we did pretty well and I was able to bring a bit more each year – all of which helped us to pay off our debts.

It may not be a blog, but perhaps babysitting, or cleaning houses, raking leaves, shoveling snow — there are all sorts of ways that you can make money.


Now is YOUR Time to Start!

My hope is that you have read through this entire post and realize that you really can do this.  You know that it is truly possible to get rid of debts – you just have to make a change.

It is not the income that is really holding most people back, it is the understanding and knowing even where to start.  You might have to scale back on various spending aspects of your life, but when you get to scream from the rooftops — WE’RE DEBT FREE!!!! — it will be worth it all.  I promise you!!!

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  1. Beth says

    Good advice. I got myself out of 34k in credit card debt and paid off my car in a little over 2 years, living alone, one income with a huge mortgage to pay on my house. My credit rating stayed very good as I was never even late on any payments. I analyzed my spending first and found that the majority of my credit card debts were from those “unplanned but sure to happen” emergencies (tires, hot water heater, etc) and my emotions that told me that I worked hard, so I could buy this or that. The debt had built over years and had become a noose around my neck and shackles on my body. Recognizing my tendencies, the FIRST priority was, as you say, building up the emergency fund. How wonderful it feels to have an “unplanned but sure to happen” expense come up and pay for it with cash AND not have it affect your monthly budget. I did the snowball plan and plotted my total debt on a graph each month. What a thrill to see that graph line drop (not so much at the beginning, but then it drops significantly each month). This was about 15 years ago and to this day, I do not have debt-except a small mortgage payment. The money management I learned by coming out of what seemed hopeless debt are hardwired in me. It truly seemed at the time that I couldn’t do it, but if I can, others can!! Make that commitment and DO it! Give yourself your life back!!

    • Tracie says

      Congrats to you for your hard work! And yes – living a life without debt is such a great feeling!!

  2. says

    When you are neck-deep in debt, you may feel that getting out of it would be next thing to impossible! But when you have the will to level up and pay your debts, you would always find a way.