How to Avoid These 5 Common Setbacks and Kill Your Debt for Good

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It's common to face setbacks while paying off debt. Here are 5 common setbacks and how you can avoid them to become debt free for good.

Sometimes I wonder, what would happen if everyone paid off their debt. Would the economy get better or worse? Would we stay out of debt? Would I be out of a job (who knows 🙂 )?

Unfortunately, recent reports indicate that 18 percent of adults expect to be in debt until they die and many others don’t expect to reach debt freedom until their 50s or 60s.

It seems to me that some of those people have lost the motivation to pay off their debt after encountering common setbacks that can deter anyone’s progress over time.

If you’re on a debt repayment journey, I have no doubt that you’ve faced some obstacles that threatened your ability to continue. Here are some of the most common setbacks people deal with (some mental and some physical) and how to overcome them.

Lack of Patience


One of the worst things about paying off debt is that it takes time to start seeing results. Not having any patience during your debt repayment journey can easily set you back and cause you to lose your motivation and give up quickly.

Sometimes, it can seem so easy to overspend, take out loans and get into debt, but it’s a challenge to pay it all off. If you didn’t accumulate your debt overnight, then you probably understand it’s going to take a lot of effort, motivation and possibly more time to get your head above water.

If you’re upset that you’re not seeing positive results fast enough, make sure you’re using the snowball method of debt repayment. With this method, you focus on paying off your smallest balance first, then you roll that payment into your next smallest balance and work your way up from there.

You can also create visuals to track your debt payoff. Some people make paper chains and hang them up in their house, then cut a chain off every time some debt is paid off. You can even remove a paper chain each time you pay off $100 in debt.

Believing Debt Isn’t a Problem


If you believe debt isn’t the problem and it’s normal because everyone has it, you probably won’t be interested in paying off your debt anytime soon. If you believe myths like everyone will qualify for student loan forgiveness or that all your debt will disappear when you die, you may not view your debt as a pressing issue.

On the contrary, consumer and student loan debt is a problem that should be taken seriously because it grows over time and can eventually take over your life.

If you ignore your balances, you could go into default and ruin your credit. Getting calls from creditors each day is frustrating and can make you feel like you have nowhere to hide. Plus, dedicating a portion of your income toward debt payments year after year will hold you back financially.

To overcome this mental obstacle, you must view debt as the enemy and imagine what your life will be like without it. Then, find people either in person or online who are debt free and check out their stories to connect your vision with reality.

If there are tons of people out there enjoying a debt free life, then why can’t you do the same? After you shift your mindset, create a plan of action to pay off your debt and use the tools and resources that are available to you online and in your community.

Having a Limited Income


Feeling like you don’t have enough money to pay off your debt is a major obstacle many people face. I once faced it and felt very discouraged because I knew I had to do something about my debt but didn’t have the means to actually do it.

To overcome this setback, I focused on spending less and earning more. The concept is really simple, but it takes a lot of effort on your end.

First, you have to make a budget and cut some of your expenses. Then, you can see if there are any debt relief solutions available to you like student loan deferment or forbearance, refinancing or consolidation.

Consolidating your loans can cut your interest rate by at least a half – allowing your payments to attack the debt and not just go towards interest. Payoff and LendingClub are great places to look for debt consolidation and SoFi can be a lifesaver for getting out of student loan debt faster.

Aside from all that, you may need to hustle and find ways to earn more. This could be asking your current employer for a raise, leveraging your bonus, finding a new job, picking up a side hustle, starting a side business, etc.

Back when I worked in an office, I actually didn’t earn much but I lowered my expenses so much that my basic income could cover them. I received a monthly performance-based bonus that I put toward my debt, I hustled on the side and each year when I got a raise, I avoided lifestyle inflation and put the extra money toward debt. If you’re having trouble thinking of ways to start killing your debt for good, our list of 25 ways to pay down debt, even with little income, offers some great ideas.

Little by little, my debt started to decrease and I saw a noticeable impact.

Having an Overwhelming Amount of Debt


If you’re feeling like you have too much debt and you don’t even know where to start, the worst thing you can do is turn away and ignore your situation. It’s common to feel ashamed and embarrassed at times, but you can’t let those feeling overwhelm you or deter you from making progress.

When you have a lot of debt, you want to make sure your interest rate is as low as possible because it could make a huge different on the timeline of your debt payoff. You should definitely look into refinancing.

If you’re okay with making minimum payments for the time being so you can work on other goals like investing or saving, there’s no harm in that. If you want to pay off your debt at a faster rate, you’ll need to exhaust your options when it comes to earning more and minimizing expenses. If you could earn even $100 a week doing something on the side, that could add up to $400 per month that you could add to your debt repayment.

Feeling the Constant Urge to Spend


One of the biggest obstacles people face during their debt repayment journey is the temptation to overspend. You may reduce your total debt balance one month and feel so good about it that you reward yourself with a night out on the town. The only problem is when you find out you can’t really afford the outing and need to use your credit card to cover your purchases.

This cycle is all too common and leads you into a never-ending debt spiral. Plus, it’s a waste of your time and effort since any progress you make gets canceled out.

To overcome this obstacle, you need to consider sticking to an all cash budget and putting all your credit cards away. You can also go on a spending freeze or avoid common triggers like your favorite stores, sales emails, etc.

Last year, my husband and I hid the credit cards we didn’t want to use from each other so they are out of sight, out of mind and it’s easier to avoid debt this way. Try delaying your gratification when you know it’s something you don’t really need at the time and probably won’t add any value to your life either.

That said, there’s nothing wrong with treating yourself as long as it fits within your budget and doesn’t deter your debt payoff.

It's common to face setbacks while paying off debt. Here are 5 common setbacks and how you can avoid them to become debt free for good.

Final Word


Paying off debt comes with quite a few obstacles but that shouldn’t discourage you from desiring to become debt free one day. Focus on changing your mindset first then let your actions follow.

If you start to believe you’ll never get ahead then you will destroy any opportunity for you to succeed. It’s that simple.

However, the road ahead will not be easy, which is why you should keep these tips in mind when you encounter any of these common obstacles.


What obstacles have stood in your way when you wanted to pay off your debt? How did you overcome them? What tricks have you found to help you pay off debt quicker?

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Choncé is a freelance writer who’s obsessed with frugality and passionate about helping others increase their savings rate, eliminate debt, and work toward financial stability. She chronicles her journey with balancing motherhood, work, and finances on her blog, MyDebt


  • Syed says:

    Just like starting a business or any other venture that will be worth it in the end, debt payoff requires a lot of upfront work. Those first few payments don’t seem like they’re doing much, but they are setting the stage for a fast principal reduction down the line. I personally prefer paying off the highest interest balance first, but if you’re getting discouraged definitely go for the lowest balance.

    • Chonce says:

      I like the avalanche method of debt repayment best too because I personally want to save as much money in interest as possible. However, I understand completely why some people choose to go with the snowball method. There’s no right or wrong way to pay off debt as long as your balances are decreasing and you feel good about it.

  • MillennialPersonalFinance says:

    I used the Avalanche method for some time and grew impatient – I switched things up and it made a world’s difference! Thanks for the insight!

  • Jayson @ Monster Piggy Bank says:

    When I was paying my debt, I knew then that it would take time. I am thankful I started being patient. Now, I still have debt, but less debt, and apply some strategies such as snowball method and consolidate. What makes me a bit different from others is that I ask questions or some advice from financial advisors to help me become debt free and handle my money well.

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