Breathe. It may seem like you’re slowly drowning beneath the weight of your debt, but believe it or not, it’s possible to resurface to financial freedom. Debt management is not easy and will require perseverance, but if you follow these steps diligently, you can find yourself out of the red faster than you thought possible.

Assess the Damage

Step one is the hardest of them all, but it’s time to rip the band-aid off and confront the damage. This means compiling any and all outstanding debts and getting a clear picture of how much you owe and to whom. Gather any unpaid medical bills, student loans, unfiled taxes, overdue car payments, outstanding credit card balances, and so on. A pro tip is to compile these into an Excel sheet with columns including:

  • Name of creditor
  • Amount owed
  • The date payment is due
  • The interest accrued on outstanding balances

Having your debts neatly organized will help you stay on track; make a check mark when you submit a payment to each bill and update its balance. Soon enough you’ll be able to cross a line through each one after they’re paid off.

Living in debt is never a fun feeling. These tips will get you well on your way to living a more peaceful debt free lifestyle. What would you add?

Target Each Debt

Having your bills laid out will help you with what’s called “debt targeting” or prioritizing which balance pay off first. Your target debt should be whichever has the highest balance and highest interest rate; taking this one off your plate will minimize the amount you incur each month as you work towards getting back in the black. Create a payment plan by calculating the following:

  • Monthly income after taxes
  • Minimum debt payments
  • Monthly expenses (rent, utilities, etc.)
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Any remaining balance should be applied to your target debt. Consider putting on “auto pay” for the minimum balance due for all other bills.

Create a Budget

The single most important thing about creating a budget is to stick to it. This is where discipline comes in; if cutting back on spending seems too challenging, consider cutting up those credit cards altogether in order to resist temptation. Your budget should be lean, with little to no frivolous spending allowed on going out to dinner or to the movies; find cost-effective ways to eat and have fun instead. If you need help figuring out your numbers, use free services such as You Need a Budget before hiring a financial advisor.

Living in debt is never a fun feeling. These tips will get you well on your way to living a more peaceful debt free lifestyle. What would you add?

Get Resourceful

Did you know that in some cases—if your credit isn’t too damaged—you can lower your interest rate simply by calling and negotiating? If that’s not an option, it is possible to lower your interest rate through loan consolidation and balance transfers. There are resources available to help you get out of debt, but it’s up to you to take advantage of them. Whether you need to stop IRS garnishment or put an end to the creditors calling and hassling you at work, do some research on savvy ways to cut down your debt, in addition to creative methods for saving money, such as:

  • Cutting your cable and gym membership
  • Stop investing in your 401(k)
  • Planning your grocery trips (and cutting those coupons)

Note: Now might be a good time to check your credit score using free sites such as Credit Karma. Don’t be discouraged if it’s low; use this number as a motivator and watch it rise as you pay off your debts.

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Monitor and Adjust

Now that you have a plan in place, don’t get too comfortable. You’ll need to regularly track your behavior, read your bank statements, and monitor your progress. As your credit score improves, reconsider consolidating your balances or negotiating your interest rates. Stick to your plan, live and breathe by your budget, and soon enough your debt will be paid off.

Before you get started, remind yourself that there’s no quick-fix for getting out of debt. Stay away from get-rich-quick schemes and don’t try to beat the system. Just like losing weight, sloughing off your debt will require patience, diligence, and time. It’s not easy, but if you stick with it, you can stop drowning in debt and relieve yourself of constant dread.