Debt Stressing You Out? Here's Your 4-Point Payoff Plan

Shedding your debt may be easier than expected.

Some people wind up in debt because life doesn't go their way -- they lose their job the same month their car breaks down and they land in the ER with a costly bill. Other people wind up in debt because they go overboard on spending or are pressured to spend money they can't afford (think attending destination weddings).

No matter why you've landed in debt, that situation could end up being overwhelmingly stressful for you. And that's not healthy -- not from a financial standpoint or a mental one. 

If your debt is wreaking havoc on your well-being, it's time to tackle it before it causes you more harm. Here's how to do that in four steps.

Step 1: Put yourself on a budget

Having a clear sense of what your monthly bills look like should make it easier to cut back on spending and carve out more room for savings -- savings you'll use to chip away at the balances on your credit cards. Make a list of your various bills and figure out where there's room to trim the fat. That could mean canceling cable for a few months or skipping your weekly Friday night dinner at a restaurant with friends.

Keep in mind the budget changes you make don't have to be permanent. You only need to keep them in place until your debt is gone.

Step 2: Determine which debts are costing you the most

It's a good idea to pay down your debt in order of highest interest rate to lowest. If you owe money on several credit cards, order them by most to least expensive interest rate so you'll know which ones to tackle first.

Step 3: See if consolidation is an option

Consolidating your debt could make it less expensive to pay down. And also, it might be good for your outlook. 

Imagine you have four different credit card balances you're juggling. That can be a lot mentally. If you're able to consolidate those various balances into, say, a single personal loan, it might make that debt easier to handle. Plus, you might snag a lower interest rate on that personal loan than what your credit cards are charging you.

Another option is to look at doing a balance transfer. Often, you'll enjoy a 0% introductory rate if you go this route, which could make it easier to dig out of that hole.

Step 4: Take steps to boost your income

The more you're able to boost your income, the sooner you might get rid of your debt. If there are opportunities to pick up extra shifts at your main job, ask for them. And if that's not an option, look into getting a side hustle, whether it's doing telemarketing work from home or caring for people's pets on weekends to scrounge up cash.

A heavy debt load could really get you down. If that's the situation you've landed in, take these steps to bust out of it as soon as possible. Doing so could really work wonders for your outlook as well as your wallet.