How To Stay Motivated To Pay Off Debt

In personal finance, one of the hard parts of getting out debt is staying motivated to pay a little bit at a time when the end goal is so far away. Putting together plans like setting up your budget or planning a debt snowball aren’t difficult, but they may take a long time, depending on your financial situation.

The hardest trick to pull off is to maintain a focused intensity on your debt payoff journey that keeps you energized through the long haul. If you’re struggling with high-interest debt, and you’re having a hard time figuring out how to stay motivated to pay off debt, this post is for you!

Question about motivation

Let me ask you a question. How many times have you thought about doing something that you knew was good for you, but you didn’t do it?  

Happens all the time, right?  That’s because you had no motivation to do it. You set up big goals for yourself with no plan on how to achieve them.

Example: Setting an Objective WITHOUT motivation

  • “I’m going pay off my student loans”
  • “I’m going to start exercising and dieting”
  • “I’m going to start saving money”

Almost anybody would look at that list and find something that they agree should be a priority for them. Still, most of us don’t do anything about it. Because there isn’t a “Why?” attached to the goal.

Example: Setting an Objective WITH Motivation

  • “I’m going to start exercising and dieting”  Why?  “So I  have more energy to play with my kids”
  • “I’m going to pay off my student loan”  Why?  “So my family doesn’t struggle financially”
  • “I’m going to start saving money”” Why? “So my wife and I can retire happily”

Though I didn’t change the objective at all, there is at least a reason attached to the goal. But motivation alone isn’t enough.

You need to establish a plan and create accountability for yourself. Let’s take a look at the importance of motivation.

  1. Identify your motivation
  2. Create a plan
  3. Establish accountability

The importance of motivation

​​​​The psychology behind what motivates folks and why it works is pretty well understood.  

Back in 1943, a professor from Brooklyn College, Abraham Maslow published a research article in the “Psychological Review” where he identified 5 types of human needs, which act as motivators.  

This is commonly referred to as “Maslow’s Hierarchy of Needs”

I’d highly encourage anyone interested in the topic of motivation to check it out, it’s a pretty quick read.

How To Stay Motivated To Pay Off Debt

The main point that Maslow was making is that humans are motivated by a sequential, hierarchy of needs beginning with the most basic things like food, safety, and shelter, too much more aspirational and internal ones.  

So the more foundational a need is, the higher a motivator it will be. So they key is to make your financial goal, like paying off credit card debt, foundational to your life’s purpose.

But it’s hard to stay motivated to anything. That’s why you also need to create a plan. Let’s talk about how to create a plan to pay off your high interest debt.

How to create a plan to pay off debt

There are two ways to create a plan to pay off debt. We’ll take a quick look at each of these debt repayment strategies.

Pay off high interest debt first.

This is also known as the debt avalanche method. You can pay off the highest interest rate debt, like credit cards, first. You make the minimum monthly payments to everything EXCEPT the highest interest rate debt.

That debt is the one where you make additional debt payments. When you pay off the loan with the highest rate, you move on to the next highest rate loan.

Since you’re no longer making payments on that first debt, you apply them to the next one. You’ll be moving from the highest interest rate debt towards debt with a lower interest rate. So over time, your debt payments will be paying down more principal and less interest.

On paper, this is the most efficient way to pay off outstanding debt, and should enable you to do so in less time than the other method. But motivation is a factor, where small victories come in.

Pay off smallest balances first.

This is also known as the debt snowball method. If you’ve watched the Dave Ramsey Show or read “The Total Money Makeover,” then you’ll know what this method entails.

The first step is to rank all your debt from smallest balances to largest balances. You’ll be making minimum payments on all everything EXCEPT the smallest balance.  

You’ll make your extra payments to the debt that’s attached to the lowest balance. Each time you pay off a debt, you move up to the next smallest debt. 

Keep doing this until all of your debts are paid off, except for good debts. This might include your mortgage or student loan debt that you reasonably expect to have forgiven under a public service loan forgiveness program. Generally speaking, these might be your biggest balances.

You might pay more in interest charges over time. However, you might be able to accomplish small wins that help you maintain motivation. And that can be a great way to keep going.

Along the way, it might help to incorporate some other tactics into your debt payment plan.

3 Tips to Help Making Debt Payments More Effective

In addition to adopting the right strategy and establishing a plan, you can probably achieve some quick wins. Here are a few tips you can use, regardless of what your plan looks like.

1. Take advantage of credit card balance transfers.

If you have a lot of credit card debt, you might be able to eliminate the interest charges by using a balance transfer credit card. Credit card companies offer these cards, with a 0% introductory rate, as a strategy to entice new customers to sign with them.

The companies bet that new customers will keep their credit card balances and eventually start accruing interest charges when the introductory rate expires. But your best strategy is to take advantage of this to achieve debt freedom.

2. Adopt a side hustle.

Yep, nothing new here. But instead of sitting around in your idle time, you can earn extra money.

It doesn’t have to be much money. Any amount of money that can pay down bad debt is an additional benefit and will help you. Here are some ways you can earn those extra dollars.

3. Put money towards an emergency fund.

What? This doesn’t sound like a good idea, right? Forcing yourself to put money away is the best thing you can do, for several reasons.

  • If there’s an unexpected expense, you don’t get completely wiped out.
  • You’ll be more likely to find expenses to cut out of your budget if you’re adding that money to your savings account.

Here’s the trick. Any money that you can cut out of your spending goes into a savings account that you don’t touch. It doesn’t have to be much money, but anything you can save goes to you, not the credit card company.

Psychologically, that’s important. You don’t stay motivated by seeing bad debt go down. You stay motivated as your personal accounts go up in value.

So you don’t just feel like you’re digging out of a hole. You are also taking that first step towards financial freedom.

Here are some tips for staying motivated.

Tips for staying motivated on your debt-free journey

So how do you make sure that it actually sticks with you?  Create accountability for yourself. 

This is sometimes easier said than done.But here are a few of the more popular tips for keeping your motivation.

1. Tell someone you care about.

There is power in telling your goals to people that you care about. It creates a forcing mechanism to stay focused since they will want to support and help you, and will ask you how it’s going.  

When we know someone else is paying attention, we have a tendency to actually follow through on what we say. It’s human nature to not want to let people down. 

2. Create a vision board.

Visuals, like whiteboards, can be very powerful. The idea here is to take a big piece of paper and either write, draw, or cut and paste images and words that inspire you towards your goals.  

This could be things like pictures of tropical vacation you would like to take, or photos of your family. You want to use visuals on the board that you can tap into for inspiration when you are feeling less motivated.

3. Create an accountability mechanism.

Write your goal on a whiteboard, and then create smaller daily/weekly tasks or routines that if done, will support the accomplishment of your goal.  

The power in this approach is that you are forced to look at your goal every day and make a conscious choice to do the smaller tasks needed to achieve it. The additional benefit of this approach is that it reinforces the positive habits you’ll need in the long run.

4. Celebrate the small goals.

Celebrate your wins whenever you get the chance. This doesn’t mean you go and buy a new car to celebrate paying off your student loans.  

Rewards yourself in small but meaningful ways, like taking your family out for dinner to recognize all the sacrifices they have made.


I hope this post gave you some food for thought on how to stay motivated to pay off debt. Here are a few key takeaways:

  1. Identify your motivation: Give power to your goals by figuring out the “Why” behind them
  2. Create accountability: Once you have established your goalcreate accountability to accomplish that goal by sharing with your friends and family, and creating daily or weekly tasks that reinforce it.
  3. Be patient: Patience is a virtue and a requirement on your journey to financial freedom. Debt freedom and financial security happens over a long period of time, and then suddenly.  Remember that when you are feeling down.  ​
  4. Celebrate your wins:  Make sure you take the opportunity to treat yourself to small rewards. If you pay off a big debt or reach the halfway point, take yourself out to lunch or dinner. It doesn’t have to be a big purchase, but just something to celebrate your hard work and what you have accomplished.

Once you have your goal and your “why”, create a plan. Then establish accountability to stick to that plan by sharing your goals with your friends and family

As you achieve success, celebrate it in ways that will help keep you motivated. Doing this will make keeping your focus on how to get out of debt is a lot easier!

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