How to Pay Off Debt When You’re Already Living Paycheck to Paycheck

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Debt sucks. It is a creeping oppression if you're currently living paycheck to paycheck.

It tends to sneak up on us gradually, and the negative impact on your life can mean worrying about getting the bills paid and not being able to afford basic necessities like healthy food or a gym membership.

It is stressful knowing that you can stretch your paycheck only so far and have a debt payments due at the end of the month.

We never really get used to our debt and it is a constant burden of stress. Like the household chores we never get around to completing, debt sits around, accumulating as the interest compounds.

When you're in this situation you can forget that debt has a way of destroying credit, which in turn makes it harder to find ways to get out of debt.

While finding ways to pay off your debt sounds like a dream — it's still possible to get rid of your debt even if you're living paycheck to paycheck.

What Does “Paycheck To Paycheck” Really Mean?

When someone claims they live “paycheck to paycheck,” it implies that they may not be able to meet their obligations until the following pay period.

They won't be able to pay all of their bills or feed their family if they don't get that next paycheck. They very well may not have any money in the bank.

You aren't alone if you currently live from paycheck to paycheck.

In fact, 78% of US Workers currently live paycheck to paycheck.

The good news is that you don't have to stay like this for the rest of your life.

Looking for ways to get out of debt now?

Here are a few ways to get out of debt that actually work.

How to Pay Off Debt When You Are Broke

Want to learn how to manage debt effectively and start saving money? Let's get started:

1. Believe That Your Situation Can Change

This may be tough to hear if you are living paycheck to paycheck but your life is determined by the things you do on a daily basis.

Including today, after reading all of these steps below how many actions will you really take to get out of debt?

Most successful people in life aren't lazy, they work hard for what they have and you need to as well.

Never settle, and continue to live below your means and learn how to grow and better your situation for you and your family. You don’t need to close your credit accounts, but cutting or hiding your card will help you avoid the temptation of overspending.

2. Pay Off Debt Using the Snowball Method

There is an old method of debt slaughtering that still works really well today. Organize your debts by size, starting with the smallest balance.

Continue paying the minimum payments for each account. For the next month, focus all of your energies on removing this debt from your collection.

Put every extra dollar you can spare into this strategy. Once that debt is removed, move on to the next highest one, adding the extra money you were using to the minimum payment you’re making on the first one.

As you go, you’ll be able to add all the minimum payments from the balances you clear. This adds funds to your payoff strategy, which can then go on to pay off the more expensive debts more quickly.

3. Get a Part-Time Job

If you find your budget depleting quickly and your debt out-of-control, you should consider getting a part-time job.

You can find legit part-time weekend jobs that will provide you with additional cash that can be applied to any debt balances you owe on loans, credit card debts and mortgages.

As mentioned earlier, instead of paying the minimum payment, you should consider paying a little extra, even if it is only $10.

This will help pay off your debt quicker and save you a little money on interest.

3. Earn More Money

The great news is that you don’t have to go out and find yourself a second job to try and make extra money with lucrative side hustles popping up.

In fact, this is something you can do in your spare time and from the comfort of your own home thanks to the availability of high-speed internet.

You can set up a home office with ease from which you can do your work in peace or you can even work from your couch.

With ways to make money online — it's possible and here is a list of ways to make some extra money starting today. There’s something on the list for everyone, so find something you enjoy and start earning some extra cash.

4. Figure Out How Much Debt You're In

To better get rid of your debt it's important to get an overall picture of your financial health.

This really means figuring out how much debt you have from all your different debt accounts. If you do not have a starting point, how can you get out of debt in the long term?

Most people use free money management and budgeting tools like Mint or Empower (full review). If this is something you are not already utilizing that should be your next step.


Take control of your finances with Empower's free personal finance tools. Get access to wealth management services and free financial management tools.

Open Account Empower Review

Mint is a free online money management and budgeting tool that tracks all of your bank and credit card accounts so you know exactly where you stand. When using budgeting tools like this, you can add a monthly budget to cover your interest payments so you know how much money is really going towards paying down your debt.

To pay off all your debts quickly, you need to know what you owe and get a credit report card. By checking your credit score and working to fix any discrepancies or building it higher you can pay less in interest, which will help you pay off debt faster.

If you don’t know your credit score, you can use free services like Credit Sesame (full review here) which gives you your score for free. You can find out your score in under a minute!

6. Look at Your Monthly Payments for Adjustments

Just because a cable company or cell phone provider quotes you a price doesn’t mean it’s the best one they can offer you.


You can find ways to pay less on your bills by contacting your service providers which you have a regular monthly bill for, for example:

  • Phone (Home, Cell Phone)
  • Insurance
  • Cable
  • Internet
  • Credit Cards

If you contact them and speak to the retention department explain that you have been offered a better deal elsewhere, they may be able to negotiate a better price for you, especially if you are a long-term, loyal customer.

If they can’t offer you a better deal, it may be worth switching providers. For example, a lot of millennials are overpaying for monthly internet service but don't opt to switch to a more affordable plan that cost less than $50/month. This a very creative way to combat debt by giving you more money in your pocket each month that'll help you stop living paycheck to paycheck.

7. Find Out Where You're Wasting Money

I've got good news for you. If you want to utilize lowering your monthly payments on bills but don't have the time to do it (or are just lazy) — you can automate it with Trim.

Hear me out — Trim users saved over $1,000,000 in the last month. Instead of having to call each company you have a bill with, Trim will do it for you… automatically.

I decided to try it out this year and linked my financial accounts and it really went to work and I saved $200.39 in 4 days. Yep, that's $200 that can go towards getting rid of my debt. Trim found ways to lower my cable bill and cell phone bill and canceled useless subscriptions I was paying for. I wrote about the process in a review of the free service, but overall here are the steps:

  1. Sign up for Trim here
  2. Provide your account details
  3. Let Trim save you money (remember, it’s 100% free)

Trim works with Comcast, Time Warner, Charter, and any other provider.

Bottom line: It was able to save me some money and hand-down is one of the more creative ways you can pay off debt. If you are at all interested in saving money, you should be using Trim.


Use Trim's AI to identify and manage your recurring subscriptions, find savings with your daily expenses and even renegotiate your bills to save you money with month.

Read Review

8. Ignore Online Scams

There is nothing more embarrassing than falling for the online scams that claim you can earn thousands of dollars a month by clicking a link and investing a couple of hundred dollars.

Similar to fad diet pills and daily fantasy sports, very few ever make a cent, let alone a living!

What a joke! Don't fall for this.

Becoming debt-free takes time, patience, and discipline, so instead of investing your hard-earned cash into what adverts call “online deals”, use the extra checks to pay off debt fast.

Every dollar you can manage to save is a dollar you can use to pay off debt. Use those dollars to your advantage.

9. Saving Money While You're Paying Off Debt

Should you save money while paying off debt? The short answer is—it depends. But, if you don’t have money set aside for emergencies and irregular expenses, you need to focus first on saving.

But how can you focus on saving money while also prioritizing getting out of living paycheck to paycheck?

One thing most people use is money-saving apps in order to help with saving money each month.

For example, building your savings is simple with Digit (full review). This innovative app saves your money without you having to lift a finger. Simply link it to your checking account, and its algorithms will determine small (and safe!) amounts of money to withdraw into a separate, FDIC-insured savings account.

Digit customers have saved over a billion dollars. If you are at all interested in saving money while paying off debt, you should be using the free Digit app.

Offer: 30-day free trial (cancel anytime)
  • Digit is an app that helps you put money in a savings, investment, and/or retirement account.
  • Digit looks at your linked bank account balance to determine how much you can save each day.
  • The app chooses your investments based on how much risk you want to take.
Open Account Digit Review

10. Consolidate Your Debt

There are a bunch of companies out there that specialize in issuing loans for the immediate payment of all debts a consumer has. Of course, this creates a new debt, but that’s okay because the interest paid on that new debt will be far lower than the interest paid on the debts paid off. Credit card debt is the worst, often exceeding 25% in annual interest and fees.

The loans issued by consolidation companies are always at much lower interest rates, meaning that debt can be paid off faster, and with less debt accumulating in the meantime.

Paying off the debt once the new loan has replaced your old debts is up to you. The best debt consolidation company right now is Upgrade.

Upgrade offers some of the lowest interest rates on the market and flexible repayment terms, but the advantages associated with Upgrade go beyond the numbers. You can learn more about them here.


Upgrade offers personal loans for various purposes, including refinancing credit cards, debt consolidation, home improvement and large purchases. Loans range from $1,000 to $50,000 and are funded as soon as the next business day.


11. Educate Yourself

The less you know about your debt, the less likely you are to repay it. You’ve got to start to realize that debt impacts your ability to create a better life for yourself.

For one, it likely destroys your credit history/score. This history is how lenders determine if you are eligible for loans, and how much those loans should cost you.

If you want to get a mortgage but you have a bad credit score, a bank might charge you 10% more each year for the privilege of borrowing their money. That could sap tens of thousands of dollars from your bank account each month, enough to buy a car or send a kid to college or pay the downpayment on another house!

You’ve got to get that score up and that debt down, if you want to increase your wealth and lifestyle.

12. Steady Thoughts Win the Race for Paying Off Debt Fast

While debt can be a result of circumstances beyond your control, it’s important that you use this time to reflect on your own habits and behaviors.

If you’re responsible for the mess you are in, a bit of introspection will work wonders for your future finances. Where did you go wrong? How can you do better next time? Audit yourself and own up to your problems, as responsibility can mean that half of the battle is won already.

Don’t waste time pointing fingers and get to work. After all, any kind of debt can cause psychological issues just as much as financial ones, and you’re only going to make things worse if you’re not thinking about the right things.

Remove all thoughts of blame, self-doubt and even guilt from your mind, and use hope and determination as your fuels to get you through. Your thoughts and feelings count for a lot in a situation like this!

The Bottom Line

Did you learn how to pay off debt while living paycheck to paycheck? The aim to minimize individual debt burdens is something Americans are focusing on. At times, unfortunately, we simply exchange one liability for a different one, the Federal Reserve shows cutting credit card debt while adding to student debt.

At the same time, we are seeing an overall decline in debt burdens. According to the Federal Reserve Bank of New York, in less than one year, consumers have decreased debt by $100 billion.

For the financial situation of millions of households, this is without a doubt a positive factor. However, often when a family cuts debt they feel like their job is done. Managing the remaining debt is just as important.

This would include the obvious areas of continuing to make timely payments on loans, focusing on the highest rates first and not building up credit spending again.

What are some ways you learned how to pay off debt living paycheck to paycheck? Leave a comment below!

About the author

Brian Meiggs
Hi, I'm Brian Meiggs! A personal finance expert, entrepreneur, and the founder of My Millennial Guide. My drive is to help others unlock the wealth of freedom and pave the path to financial success. With my bachelor's degree in finance, I help millennials follow the smart money in order to increase their earning potential and start building wealth for the future. I write regularly about side hustles, investing, and general personal finance topics aimed to help anyone earn more, pay off debt, and reach financial freedom. I have been quoted in major publications including Business Insider, Yahoo Finance, NASDAQ, Discover, GoDaddy, BiggerPockets, Fox News,, Quick Sprout, Money Geek, MSN Money and many more!