The Debt Payoff Playbook

Find out how to pay off your debt fast!

Paying off debt and building a future you can live off of is the primary focus of this blog. We are not talking about merely surviving in our golden years, but actually thriving! Unfortunately, the world is not geared towards helping you thrive in retirement.

Corporations employ marketing strategies and spend billions of dollars trying to figure out how to make you part with your money and buy their products. It is the survival of the fittest – and the more clever one ends up with the money. As Thomas Tusser once said, “A fool and his money are soon parted.” My friends, it’s time to stop being the fool and to start taking control of our future. If you’re reading this, that day is today! Welcome to your new life!

The Debt Payoff Playbook is a layout of a few easy steps to make sense of the mess you are in. The general idea is to get rid of your debt and start building your wealth. Easier said than done right? As we start this journey, realize there will be ups and downs – but I am confident you will come out successful if you keep moving forward! If you need a little more motivation, please refer to my related article, Your reason for living…

The Debt Payoff Playbook is laid out in 8 simple phases – because complexity only causes confusion. Follow these steps in order and you will soon find yourself in the place you deserve to be, debt free and building wealth!

Without further ado, let’s get your life back on track!

Phase 1 – Build A Budget

I’m willing to bet you don’t have a budget if you are in this mess – and if you do, you certainly are not following it. The word “budget” was previously a curse word in my family, but over time we have come to embrace it. It turns out, you can still live on a budget! For a more detailed explanation on how to build a budget, please refer to my related article: Budget Isn’t A Bad Word.

Phase 2 – Save $1,500 – $2,000 For Emergencies

Let’s face it, life has a mean way of kicking us when we are down. By setting up a budget and setting up your emergency savings, you can kick life back when it tries to bully you. This emergency saving will protect you from many of life’s unforeseen financial struggles. Medical bills tend to be high on the list of debt – and with the average cost of an emergency room visit being $1,233.00¹, this emergency savings may be just what you need to keep you from putting more debt on your credit cards. In order to speed up the emergency savings process, make minimum payments on everything until you get this funded.

Phase 3 – Attack Your Debt!

action activity adult attack
Photo by Pixabay on Pexels.com

It’s time to stop fooling around. These credit cards, student loans, medical bills, car payments **insert other debts here** have been around for far to long. They are controlling your life and it is not fun anymore. This is where you bear down and take your life back – by destroying one debt at a time. There are different theories for which debt you should tackle first and for more on this visit my related article: Simple Steps To Start Your Debt Free Life!

Phase 4 – Cash Reserves For 6 Months

You’re debt free!!! Finally!! Now what will you do if you lose your job tomorrow? Will you be thrown right back into drowning debt like you were before? Let’s set ourselves up for success rather than failure. By quickly saving up 6 months of living expenses – just the bare minimums needed to live each month – we can account for some of life’s worst case financial scenarios.

Phase 5 – 18% Of Your Income Into Retirement

Experts have differing opinions on this “magical number”. Some say 15% while others say 20%. 18% has worked well for me and will set me up very nicely in retirement – I recommend you do the same. If you can afford more, then put away as much as you can while still enjoying life in the process. Future articles will discuss where to invest, but a great starting point is an employer sponsored 401k or 457b.

Phase 6 – Save/Invest For Future Specific Plans

mountains nature arrow guide
Photo by Jens Johnsson on Pexels.com

Do you have children who would like to go to college someday? Do you have elderly parents who may not be able to survive off social security alone? Planning to adopt a child? This phase is for identifying future financial needs that need to be planned for ahead of time. Get the kids college fund started or start saving for those other big ticket items now so you don’t regret it in the future.

Phase 7 – Get Rid Of That Mortgage

How would it feel to have no house payment? This is the time to annihilate that mortgage! Use the same motivation you had when paying off your debt to rid yourself of that pesky monthly mortgage payment. If you’re wondering if you need a mortgage for a tax write off, please refer to my related article: The Home Mortgage Loan Lie.

Phase 8 – Invest For Success

You have no debt, no mortgage, you’re saving up for future expenses and have plenty of money left over. What do you do now? Other than celebrate and enjoy it, let’s move that extra money into additional investment vehicles such as a Roth IRA. This is where you move ahead of the curve and set yourself up financially to leave a substantial inheritance to your heirs or be a huge financial blessing to those charities you believe in.

man with fireworks
Photo by Rakicevic Nenad on Pexels.com

When you complete these phases – (Trust me, it’s possible!), I would love to come celebrate with you! A small fraction of people live this way – financially responsible – and I know you are tired of living like everyone else. You work too hard to be this broke my friends, it’s time to destroy the status quo and change your future!


What step are you currently on? Let me know, I would love to encourage you!! Comment below, I am curious to see where you all are starting your journeys. Also, please share this post across social media if you found it beneficial and sign up for email updates in the box below. Thank you for reading and please reach out if you have any questions!

-Ryan

¹https://www.debt.org/medical/emergency-room-urgent-care-costs/

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Author: Ryan

Hi!  My name is Ryan and I have a passion for personal finance and education.  I am married and have three children, a girl and two boys all under the age of ten.  My wife stays home with the kids so it can be challenging to live off one income.  Much of what I write is based off my personal experiences and what I have learned in the course of my life. My financial journey began when my wife and I saved up a sum of money and I didn't know who I could trust to invest it.  After several interviews with financial advisers, I still didn't feel like I could trust anyone.  That began my journey to educate myself by reading every finance book I could get my hand on and by attending financial seminars.  After getting a good handle on debt, finance, and investments, I decided to start this blog as a resource for others who find it difficult to trust people with their money. I recently started writing this blog about how to get out of debt and start investing to create the future you deserve. I have been in law enforcement for 14 years and I have seen the devastation left behind by people who mismanage their finances.  I started this blog because I want to help as many people I can by educating them on common sense money management. As far as my formal education, I obtained a Bachelor of Science in Education and a Master of Administration Degree from Northern Arizona University.  I am an adjunct professor at a local community college and I have been a student of finance for many years. This blog is dedicated to those looking to eliminate their debt and to mold a new way of thinking, living, and spending. Education, focused on financial stability and wealth, is the main purpose of this blog. This website is a new journey for me and I know there are areas that I could improve.  Please feel free to reach out to me with any critiques - I would love the feedback so I can be as effective as I possibly can and provide the most relevant information.  I look forward to writing for you and learning with you! If you have any questions or comments, I would love to hear from you! -Ryan

10 thoughts on “The Debt Payoff Playbook”

  1. Ryan, what is the time frame for completion of these phases? I understand it would vary based on every individuals situation but from your perspective should these phases be completed in about a years time frame? 5 years? Building the emergency fund while making minimum payments to other debts could take a few months in and of itself. Does that seem right to you?

    Liked by 1 person

    1. Great question Taylor! I can not put time frames on any of these because as you said, they can all be different depending on your situation. The emergency savings is intended to keep you from adding further debt. If you continue to make small payments to your savings while trying to pay debt off at the same time, you’re going no where fast. It’s all about using a laser focus on what goal you are working on and getting it done.
      If it’s taking too long to get the emergency savings in place, you may need to sell some stuff, cut things out of your budget, get a side hustle, or a combination of all 3. Some people may take a month to get to a new phase, others may take years depending on what phase they are on.

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  2. I have phases 1-6 covered. I need to double check 5 to see if it needs to be adjusted. I am getting a new house in December so I will be at the start of having a mortgage. Is it possible to have al lthe other bases covered with a mortgage and still build wealth?

    Liked by 1 person

    1. Absolutely! I’m building wealth right now while I am paying off my mortgage. I max out my 457 each year and all the extra money from side hustles and checks goes towards the house.

      Like

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