Brutally Honest Guide to Pay Off Debt in 6 Months

[00:00] Let me say something that might sound

[00:01] shocking. If you're in debt right now,

[00:04] it's possible you'll be in debt for the

[00:07] rest of your life. Not because you have

[00:09] to be, not because you even want to be,

[00:11] but because you don't know how to escape

[00:13] the cycle. Right now, about 64 million

[00:17] Americans have debt in collections. That

[00:20] means non-stop calls from debt

[00:21] collectors, late fees stacking up, and

[00:24] the constant stress of knowing you're

[00:26] behind. But it doesn't have to be that

[00:28] way for you. That's why you're here. In

[00:30] this video, I'm walking you through the

[00:32] eightstep debt payoff system that

[00:34] actually works so you can get out of

[00:36] debt fast and stay out of it for the

[00:39] rest of your life. This is the system

[00:41] that will change everything. Let's get

[00:43] into it. Step one, face the brutal truth

[00:47] about your debt. A lot of people go,

[00:48] "Yeah, I have some debt, but it's fine.

[00:50] I'm handling it. I'm making payments."

[00:52] If you were handling it, you probably

[00:55] wouldn't be watching this video. Pull up

[00:57] every single debt you have. Credit

[00:59] cards, student loans, medical bills,

[01:01] everything. I don't even care if it's a

[01:02] random $200 bill you owe your friend

[01:04] from three years ago. Write it down.

[01:07] Here's what you need. Total debt amount,

[01:10] interest rates, this is the silent

[01:12] killer, and minimum payments. For

[01:14] example, James gathers everything we

[01:17] just covered. Here's what that would

[01:18] look like for him. Notice he's got his

[01:21] credit card, which has a really high

[01:23] interest rate. another credit card which

[01:25] has an even higher interest rate and a

[01:27] car loan at 9%. And notice those minimum

[01:30] payments. They're quite revealing. Now,

[01:32] most people truly avoid this step

[01:34] because it's painful. Who wants to go

[01:36] digging around for how much we owe? But

[01:38] ignoring your debt does not make it go

[01:40] away. It's like ignoring a gas leak in

[01:42] your house and going, "Well, I don't

[01:43] smell it all the time." All right. Well,

[01:45] it doesn't mean it's not going to blow

[01:46] up. And here's one more thing. Add your

[01:49] credit report to the mix. It's a very

[01:51] high chance you may have forgotten about

[01:53] one piece of debt. Go to

[01:56] annualcreditreport.com and pull your

[01:58] full report. You might find an old debt

[02:00] that you don't even remember or a

[02:01] mistake. Now, if you've ever looked at

[02:03] your credit card statement and thought,

[02:05] "How the hell did this get so high?"

[02:07] You're in the right place. I'm not here

[02:09] to shame you. I'm here to help you pay

[02:11] it off faster, smarter, and without

[02:13] restricting everything you love. So, hit

[02:16] subscribe, turn on notifications, and

[02:18] let's make sure the only thing you are

[02:20] moving forward with is confidence, not

[02:23] debt. All right, you have your full list

[02:25] of debts and interest rates and minimum

[02:26] balances. Let's move on to the next

[02:28] step. Step two, choose your attack plan.

[02:31] Snowball versus avalanche. Now that we

[02:33] know how much debt we're dealing with,

[02:35] it's time to attack it to go on offense.

[02:38] There are two proven ways to do this.

[02:40] First, the debt snowball method. This is

[02:43] where you pay off the smallest balances

[02:45] first. You get some quick wins. You feel

[02:47] good about yourself. It gives you the

[02:49] motivation to keep going. The second

[02:51] approach is the debt avalanche method.

[02:53] This is where you focus on paying off

[02:55] the debt with the highest interest rate

[02:57] first. This approach saves you the most

[03:00] money in the long run. Let me be real

[03:02] with you. If you're more

[03:03] numbersoriented, the avalanche method is

[03:05] mathematically the best choice. You'll

[03:07] pay less interest overall and that's a

[03:09] win. But if you need small wins to keep

[03:11] yourself motivated, go with the snowball

[03:14] method. I really don't care which one

[03:15] you choose. The most important thing is

[03:17] you pick one and you commit. For

[03:20] example, James chooses the snowball

[03:22] method to keep himself motivated and he

[03:24] attacks his smallest debt, which is his

[03:27] Chase credit card first. Bonus strategy,

[03:30] the five-minute call that can save you

[03:31] thousands. This is a strategy most

[03:33] people don't even realize they can use.

[03:35] Call up your credit card company and ask

[03:37] them to lower your APR. Here are the

[03:40] exact words to use. Hi, I'm going to be

[03:43] paying off my credit card debt more

[03:44] aggressively beginning next week, and

[03:46] I'd like for you to lower my interest

[03:48] rate. Uh, why? I've decided to be more

[03:51] aggressive about paying off my debt.

[03:53] Other cards are offering me rates at

[03:55] half of what you're offering. Can you

[03:57] lower my rate by 50% or only 40%. I've

[04:00] been a customer for 8 years and I would

[04:02] prefer not to switch my balance over to

[04:04] a lowinterest card. Can you match the

[04:07] other card rates or can you go lower?

[04:08] Now listen, it doesn't work every time,

[04:10] but when it does, you can often save

[04:13] thousands of dollars in interest alone.

[04:15] So, make the call. That leaves more

[04:17] money to go towards your actual debt so

[04:20] you can pay it off even faster. Step

[04:22] three, the lazy genius way to pay off

[04:25] debt. The biggest mistake people make

[04:27] when trying to pay off their debt is

[04:28] relying on willpower. Guys, willpower is

[04:31] garbage. It's like depending on

[04:33] motivation to go to the gym. That lasts

[04:36] about 3 days and then you're right back

[04:38] sitting on your couch watching Netflix

[04:40] for 4 hours, salt and vinegar chip

[04:42] crumbs all over you. Instead of relying

[04:45] on willpower, automate your debt

[04:47] payments so you don't even have to think

[04:49] about them. Here's how. First, set up

[04:51] minimum payments on all your debts so

[04:54] you won't get hit with any late fees.

[04:57] Next, automatically send any extra cash

[05:00] to your highest priority debt using the

[05:03] avalanche or snowball method, your

[05:06] choice. And most importantly, make sure

[05:08] to time your automatic payments right

[05:10] after payday, so you never even see that

[05:13] money sitting in your account, which

[05:15] tempts you to spend it. Now, once this

[05:17] is set up, your debt shrinks every

[05:19] single month without you stressing out

[05:21] over it or creating any work for you.

[05:24] Quick little bonus, you can use our new

[05:27] debt payoff calculator to see the exact

[05:31] time when you will be debtree. Take a

[05:34] look. Step four, free up cash without

[05:38] living like a hermit. You guys, paying

[05:39] off your debt doesn't mean you have to

[05:41] give up everything you love. People

[05:43] think it means no dinners out, no

[05:44] vacation. Well, okay. You probably

[05:46] shouldn't be taking $5,000 vacations if

[05:47] you have 20k of credit card debt. Let's

[05:49] be honest. But you don't have to sit at

[05:52] home with the lights off eating reheated

[05:54] ramen noodles just to pay off your debt.

[05:57] That's not how we do things here, okay?

[05:58] I believe in living a rich life today

[06:00] and a rich life tomorrow, even if you

[06:02] have debt. So, let's find some extra

[06:04] cash you won't even miss. Start with

[06:07] these quick wins. Unused subscriptions.

[06:10] If you're still paying for subscriptions

[06:13] but not actually using those services or

[06:15] they're just outdated, cancel them.

[06:18] Overpriced insurance, call your

[06:20] providers and say, "Hey, I'm shopping

[06:21] around for better rates. What can you do

[06:22] for me?" And finally, impulse spending.

[06:25] Take an honest look at your spending,

[06:27] especially on eating out and delivery.

[06:29] Figure out what you need to do to

[06:31] pre-plan. That can often save you

[06:33] hundreds of dollars per month. In my

[06:35] experience talking to tons of people, I

[06:37] found that most people can free up at

[06:39] least $500 a month by methodically going

[06:43] through those steps. And when you free

[06:46] that money up, whether it's 100, 500,

[06:48] a,000, you can take that money and

[06:50] redirect it to getting debtree even

[06:53] faster. Next, I want to show you how you

[06:55] can pay off debt even faster. And if I

[06:57] were you, that's exactly what I would

[06:59] want to do. Because your debt doesn't

[07:01] only impact you, it impacts your family.

[07:04] It impacts your kids. What kind of role

[07:07] model are you setting for your kids if

[07:10] you yourself are in debt? Part of what I

[07:13] want you to do is to have a healthy

[07:15] relationship with money. Because as a

[07:17] parent, you want to do everything you

[07:18] can to protect your kids. Yes, that

[07:20] means getting out of debt. It also means

[07:22] making sure you have term life insurance

[07:24] so they are taken care of financially if

[07:27] you were to get hit by a bus tomorrow.

[07:29] This video's sponsor, Fabric by Gerber

[07:32] Life, can help with that. Fabric by

[07:34] Gerber Life is term life insurance you

[07:36] can get done right from your couch, all

[07:39] online and on your schedule. You could

[07:41] be covered in under 10 minutes with no

[07:44] health exam required. If you've got

[07:46] kids, and especially if you're young and

[07:48] healthy, it's a great idea to lock in

[07:50] rates now. Even if you have life

[07:52] insurance through your employer, that

[07:54] may not offer enough protection for your

[07:55] family, and it may not follow you if you

[07:58] leave your job. Now, there's no risk.

[08:00] There's a 30-day money back guarantee,

[08:02] and you can cancel at any time. They

[08:04] have over 1,900 five-star reviews on

[08:06] Trustpilot with a rating of excellent.

[08:09] Join the thousands of parents who trust

[08:10] Fabric to protect their family. Apply

[08:12] today in just minutes at

[08:17] meetfabric.com/raitsi or click the link

[08:18] in the description below. Again,

[08:23] meetfabric.com/raitsi. Now, let's move

[08:25] on to step five. Unlock the cheat code

[08:28] to pay off debt faster. Okay, now you're

[08:31] paying off debt methodically. But if you

[08:33] want to speed things up even faster,

[08:34] don't only focus on cutting back. Find

[08:37] creative ways to earn more. Even an

[08:40] extra $200, $500, $1,000 a month can

[08:44] make a huge difference. That can often

[08:46] cut off years of debt payments. Here's

[08:49] how to bring in extra cash. Freelancing.

[08:52] Take the expertise you already have and

[08:54] sell it. For example, writing, graphic

[08:57] design, tutoring, project management.

[08:59] There's so many ways you can start to

[09:00] earn more. Side gigs, ride share

[09:02] driving, food delivery, pet sitting.

[09:04] These are just three of a million ideas.

[09:07] Sell things you don't use. Sometimes

[09:09] people show me videos of their closet

[09:10] and I'm like, "What the?" Taking the

[09:13] things in your closet, the things in

[09:15] your storage. In fact, if you have

[09:17] storage right there, that's a great way

[09:20] to get rid of it and cut a monthly fee.

[09:22] Turn hobbies into cash. Cooking,

[09:24] photography, even fitness coaching can

[09:26] become viable income streams. Check out

[09:28] my Earn1K program in the description

[09:30] below to see how I can help you start to

[09:32] earn more money and ask for a raise. If

[09:35] you've been delivering real value at

[09:37] work, learn the skills to negotiate your

[09:39] salary. When you increase your income,

[09:42] stay laser focused on paying off your

[09:44] debt. So, take that extra cash and take

[09:46] at least the majority of it and put it

[09:48] towards paying that debt off even

[09:50] faster. That is the best way to get debt

[09:52] free and to live an even richer life

[09:54] tomorrow. Step six, turn your debt

[09:56] payoff into a game. Debt payoff is

[09:58] boring if you don't track your wins.

[10:00] Now, I don't mind boring. I like eating

[10:02] the same meal pretty much every day. I

[10:04] like seeing my investments grow slowly

[10:07] over time. But I've learned a lot of

[10:09] people hate boring. They want to gify

[10:13] everything. They want everything to have

[10:15] flashing lights. Sometimes they

[10:17] hand me their phone to take photos. I

[10:18] go, "What? You have this many

[10:20] notifications. What's wrong with you?

[10:22] Whatever. It's your life, not mine. But

[10:24] for those of you who are allergic to

[10:25] boring, I get it. If something is

[10:27] boring, you might quit. The secret is

[10:29] making your progress visible and

[10:32] exciting. A weekly check-in, not just

[10:35] monthly, keeps you engaged and helps you

[10:37] catch unnecessary expenses before they

[10:40] drain your spending. Now, for example,

[10:42] these little recurring small charges can

[10:45] often add up over time when you are

[10:47] making an aggressive debt payoff plan.

[10:50] Subscriptions, convenience fees, impulse

[10:53] purchases can sneak in. For example, you

[10:55] might be paying for three different

[10:57] streaming services, but only really

[10:59] watching one. A gym membership you

[11:01] actually haven't used in 2 and 1/2

[11:02] months, or random service fees that you

[11:06] didn't even authorize. Now, if you're

[11:08] only checking your statements once a

[11:09] month during your aggressive debt payoff

[11:11] plan, it's going to be hard to connect

[11:13] those fees with what's going on with

[11:15] your debt, those fees have already been

[11:17] levied. But if you do a quick 5-minute

[11:19] review every week during this aggressive

[11:21] sprint, you can stop those money leaks.

[11:24] Here's your weekly routine. You open up

[11:26] your debt tracking spreadsheet, or you

[11:28] can use wab, credit karma, or another

[11:30] tracker. You look at how much your debt

[11:31] has dropped. Even if it's small, give

[11:33] yourself a big pat on the back. That's

[11:34] progress. Three, you hunt down sneaky

[11:36] charges. Find those little expenses that

[11:38] add up and cut them. And then four, make

[11:41] this a game that you celebrate. Each

[11:44] week at the end of the week, take a look

[11:46] and really realize how far you've come.

[11:48] That is impressive. Tracking your

[11:50] progress weekly is not just about

[11:52] accountability. It's also about

[11:54] momentum. And momentum is what separates

[11:56] the people who actually get out of debt

[11:59] from those who learn to live with it

[12:01] forever. So set a reminder in your phone

[12:03] every Sunday. 5 minutes, no excuses.

[12:06] Step seven, avoid debt traps that keep

[12:09] you stuck. You're making progress.

[12:10] You're paying off debt. You're feeling

[12:11] better, but then boom, you're right back

[12:14] where you started. Why? Because a lot of

[12:16] people fall into the same traps over and

[12:19] over. And you know what I'm talking

[12:20] about if you've ever said something

[12:21] like, "It feels like I take one step

[12:23] forward and two steps back." Well, let's

[12:25] make sure you don't. Here's what will

[12:28] keep you in debt forever and how to

[12:30] avoid it. looking for quick fixes like

[12:33] balance transfers. These sound tempting.

[12:35] Low APRs, a temporary break from

[12:38] interest, and a way to escape

[12:39] highinterest debt. Here's the reality.

[12:42] These credit card companies are way

[12:43] smarter than you or I am. They lure you

[12:46] in with 0% APR for 12 months. But the

[12:49] moment you miss a payment or don't pay

[12:51] off the balance in full, boom, you're

[12:54] hit with a retroactive interest rate

[12:56] that might be even worse than what you

[12:58] started with. Now you're stuck in the

[13:00] same cycle just with a different

[13:01] company. Balance transfers, in my

[13:04] opinion, can work, but they are often a

[13:06] gimmick. Keeping the same old spending

[13:09] habits. Paying off debt is not just

[13:11] about throwing money at your balance.

[13:13] It's actually about changing your

[13:15] relationship with money. So, here's the

[13:17] brutal truth. If you're trying to pay

[13:18] off debt, but you're still swiping your

[13:20] credit card for impulse buys, you're

[13:23] self-sabotaging. And a lot of the ways

[13:25] people tell themselves this is they go,

[13:27] "Well, it's already so big, it's not

[13:28] going to make that much of a difference

[13:29] anyway." Imagine you're trying to run a

[13:31] marathon while eating a triple

[13:33] cheeseburger between each mile. Not only

[13:36] are you slowing yourself down, you're

[13:38] actively making things worse. In other

[13:40] words, you can't dig yourself out of a

[13:42] hole while you're making it deeper. So,

[13:45] if you are serious about paying off

[13:46] credit cards, put those credit cards

[13:48] away and get aggressive with your debt

[13:51] payoff. falling for debt consolidation

[13:53] scams. Yes, there are real debt relief

[13:56] options out there and there are a lot of

[13:58] scams that will screw you over even

[14:00] more. A lot of these debt relief

[14:02] companies promise to simplify your

[14:03] payments or settle your debt for pennies

[14:06] on the dollar. Some of them just charge

[14:08] you hidden fees and drag out your

[14:09] payments longer. And some of them do

[14:12] what you yourself could do, put you on a

[14:14] spending plan, have you call up the

[14:16] companies and negotiate with them. You

[14:18] could do all of this yourself. Really, a

[14:20] lot of people are simply looking to

[14:22] delegate the problem to someone else.

[14:24] But if you want to pay your debt off,

[14:26] you have to take responsibility

[14:28] yourself. Here are some red flags to

[14:30] watch out for. High upfront fees with

[14:33] these debt relief companies before they

[14:34] even help you. Guarantees that sound too

[14:36] good to be true. And advice to stop

[14:39] making payments on your current debt. A

[14:41] good guideline is if a company claims

[14:43] they can erase your debt overnight, run.

[14:46] You can work with a nonprofit credit

[14:48] counseling agency, not a for-profit debt

[14:51] relief company looking to squeeze you

[14:53] for more money. Paying only the

[14:55] minimums. Well, banks love it when you

[14:56] do this cuz it means they get to collect

[14:58] more interest from you over decades. Let

[15:00] me show you how they trick you. Let's

[15:02] say you have $5,000 in debt on a credit

[15:04] card with a 27% APR. If you only make

[15:07] the minimum payments, you could be

[15:08] paying that off for almost 25 years. And

[15:11] over time, you'd pay more than triple

[15:14] what you originally borrowed. Meanwhile,

[15:16] the bank is sending you these credit

[15:18] limit increases and special offers to

[15:20] keep you hooked. Oh, you get 32 points

[15:22] per month. You can redeem it for a

[15:23] Marriott stay uh 300 years from now.

[15:26] Don't fall for it. Pay more than the

[15:29] minimum every single month. And if you

[15:31] can't, then you need to take a hard look

[15:33] at your current spending. If you avoid

[15:35] these traps, you won't just get out of

[15:37] debt, you can stay out of it for good.

[15:39] Which brings me to step eight. Never go

[15:42] back. How to stay debt free for life.

[15:45] Okay, congratulations. You did it. You

[15:47] paid off your debt. You're ahead of most

[15:49] people. But now, let's look at the next

[15:51] challenge over the horizon. Getting out

[15:53] of debt is just the beginning. Staying

[15:55] out is the real win. A lot of people

[15:57] make that final payment, feel the

[15:58] relief, and then slide right back into

[16:00] old habits. Why? Because they didn't

[16:02] have the systems in place to stop that

[16:05] debt from creeping in. We don't want to

[16:07] be yo-yoing back and forth in and out of

[16:09] debt for our whole lives. That sucks.

[16:11] So, let's make sure that's not you. Here

[16:13] are three simple strategies to stay

[16:15] debtree for good. Number one, use the

[16:17] envelope system to control your

[16:19] spending. If credit cards were your

[16:20] weakness, try switching to cash for a

[16:22] little while. It's kind of like using

[16:23] bumper lanes when you start bowling.

[16:25] Just get the habits right and eventually

[16:27] you can take it away. The envelope

[16:29] system is a powerful set of training

[16:31] wheels to build some discipline. Here's

[16:33] how it works. You set spending limits by

[16:35] category, groceries, dining, etc. You

[16:38] put cash in labeled envelopes, and when

[16:40] it's gone, you're done spending. This

[16:42] forces you to live within your means. No

[16:44] surprises, no swipe and forget moments.

[16:47] Number two, use credit cards only if you

[16:50] pay in full every month. Credit cards

[16:52] aren't evil. I have no problem with

[16:54] credit cards, per se. I use multiple

[16:56] credit cards, but here's a rule. If you

[16:57] carry a balance, stop using them.

[17:00] Period. Red alert. That is an emergency.

[17:03] Do you know how many people I talk to on

[17:04] my podcast where they have thousands of

[17:07] dollars in credit card debt every single

[17:08] month? I go, "Why are you paying that?"

[17:09] And they go, "Well, what about the

[17:11] points?" What about the points worth

[17:14] less than one penny? Meanwhile, you're

[17:16] paying

[17:17] 27.99% interest. No. Who told you that?

[17:21] Americans hate to not optimize

[17:24] everything. Why don't you optimize your

[17:26] debt payoff instead of optimizing a stay

[17:28] at a twostar property 36 years from now?

[17:30] Number three, build an emergency fund so

[17:32] you don't rely on credit. You know, a

[17:34] lot of people fall back into debt

[17:35] because they're not prepared. Something

[17:36] happens that they didn't expect. A flat

[17:38] tire, a medical bill, broken AC. That

[17:41] should not derail your finances. Which

[17:43] is why I want you to start small by

[17:45] creating an emergency fund. Start with a

[17:48] $50 a month, $100 a month. Get that

[17:50] number to $1,000. Aim for 3 to 6 months

[17:54] of fixed costs and store that money in a

[17:58] separate high yield savings account. The

[18:01] easiest way to do this is to make it

[18:02] automatic. Set up an automatic transfer

[18:04] every payday. Even $25 a week adds up

[18:08] fast. Remember, we're not relying on

[18:10] willpower. We are using systems to

[18:13] protect you from slipping back into

[18:15] debt. Do this and you will never have to

[18:18] climb out of that hole again. Now you

[18:20] know how to pay off your debt in 6

[18:21] months. And what's the best way to stay

[18:23] out of debt? Make more money so that

[18:26] debt is not your primary problem. Go

[18:29] watch this video next on how to increase

[18:31] your income. Trust me, earning more is

[18:33] the kind of decision that will pay off

[18:35] huge for you.