How to Pay Off Unsecured Credit Debt

Developing a plan can help you pay down unsecured debt faster.

Developing a plan can help you pay down unsecured debt faster.

Being in debt can be a real downer, especially when it prevents you from reaching your financial goals. For married couples, debt can be a huge roadblock if you're trying to save for a home, start a family or plan for retirement. If you're carrying around a significant amount of unsecured credit debt, developing a debt repayment strategy can help you and your spouse get on the fast track to financial freedom.

Add up all of your unsecured debts. This might include credit cards, personal loans and medical bills. Write down the total balance for each debt, along with the interest rate and the amount of the monthly payment.

Go over your budget to see how much money you have each month to put toward debt repayment. Make a list of all your fixed expenses, including your mortgage and utilities, as well as your variable expenses, which might include things like groceries or dining out. Compare the total amount you're spending each month to your total monthly income. Ideally, you should have more coming in than going out.

Arrange your debts in the order in which you want to pay them off. You can either list them by the interest rate from highest to lowest or the balance from smallest to largest. Mathematically, paying down the debt with the highest interest rate will save you the most money, but paying down smaller balances first can be more motivating.

Make the minimum required payments for all of your unsecured debts except the one that's at the top of your list. For that debt, you'll want to pay as much above the minimum as you can each month until it's paid off. Once the first debt is knocked out, you can roll your payment over to the next debt. As you continue paying off your debts, keep rolling the newly available money over until it's all going to the last debt on the list.

Items you will need

  • Recent credit card statements
  • List of monthly expenses
  • Recent pay stubs


  • Look around for balance transfer offers if you're paying a high interest rate on one of your debts or more. Transferring a balance to a card with a lower rate could save you hundreds of dollars in interest and speed up your debt repayment.
  • Track your spending each month to help keep your budget in line. You may not realize how much money your daily coffee habit is costing you until you see it on paper.


  • Don't automatically close your credit card accounts after you pay off the balance. Doing so could cause your credit score to drop if you're still carrying a lot of debt on your other cards.
  • Think carefully about taking out a consolidation loan to pay off your debts. If, for example, you borrow against your home to pay off credit cards and are unable to make the payment, you could lose your home.

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About the Author

Rebecca Lake is a freelance writer and virtual assistant living in the southeast. She has been writing professionally since 2009 for various websites. Lake received her master's degree in criminal justice from Charleston Southern University.

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