It can be overwhelming if your debt is piling up. You may feel like no matter what you do, you can never get ahead of it. As inflation continues to rise, many people are going further into debt to pay for their essentials. According to a survey by, 1 in 4 Canadians confessed to taking on debt to pay for their higher cost of living in 2022. 

Even though it may feel like you are at a point of no return, there are always changes you can make to your daily behaviours. These changes can help you avoid digging yourself deeper into debt. Instead, flip the switch and start paying off your accumulated debt. Read the rest of this blog to find out how. 

1. Figure out how much you have and where it came from

One of the first things you should do to take control of your debt is to make a list of all your debts and see how much you owe on each. Then, add everything up to find out exactly how much total debt you have right now. Often, when people feel overwhelmed by their debt, they’ll look the other way and pretend it's not there. This puts them in a worse position. It could lead to missed payments, ending up in even more debt from arrears fees and interest. Further, they may continue the same behaviours that got them to this point. Instead, face your debt reality and start a plan to get it paid down.

It's also important to assess why you have debt in the first place. Look at your list of debts, and take note of what you believe caused each balance. For example, if you have a significant amount of credit card debt, it means that you are probably overspending and need a cash flow plan, or need to make adjustments to your current one. Or did you have one big emergency that’s responsible for the entire balance? Taking control of your debt means finding the root cause and changing your behaviour. It isn’t as simple as trying to make more money to pay it off. In fact, when you make more money, you tend to spend more, resulting in even more debt. Instead, take a look at how you got to this point, and then figure out the most practical way you can start heading in the right direction with a debt repayment plan.

2. Automate debt payments

A great way to start consistently making a dent in your debt is to automate your payments, where possible. For instance, if you have a line of credit or credit card, set up automatic payments from your committed account for the minimum payment, or more. If you have a regular income, like a biweekly paycheque from a job, you can time these automatic debt payments to occur the same day you get paid. This way, the money for debt will automatically be deducted from your bank account, and you will not have to worry about spending more than you have. By having automatic payments, you will ensure that you do not miss any payments, and you’ll start paying down your debt without much effort.

Learn more about committed and spendable accounts in our Financial Capability Series session: Spending and cash flow

3. Find a debt repayment method that works best for you

There are multiple methods you could use to repay debt; it all depends on what works best for you, both financially and psychologically. You could try the avalanche, snowball or snowflake debt repayment methods. 

With the avalanche method, you pay off the debt with the highest interest rate first, while making minimum payments on other debts. After your highest interest debt is paid off, you move on to the next highest interest debt.

For the snowball method, you start paying off your debt by beginning with the smallest debt balance, and then working up to larger debts, still maintaining the minimum payment for all debts. Since you are getting the smallest debt paid off faster, you’ll likely feel a sense of accomplishment after each one is paid off. This could keep you motivated to continue accomplishing more.

Lastly, there is the snowflake method, which is best used if you don’t have the money to pay more than your minimum payments on a regular basis. With this debt repayment method, you still pay the minimum on all your debt. Then, whenever you do have extra money leftover or if you received a sum of money from a bonus or gift, whether it's small or large, you put it towards debt. It may not seem like much difference at first if it's only tiny amounts, but it will add up over time.

4. Make it harder to overspend

One of the reasons people might have a lot of debt, specifically credit card debt, is because they had easy access to credit and ended up using it mindlessly. For example, most places where you purchase something online will ask to save your credit card information. Many people click yes for ease. Next time you go to that website and see something you like, it's really easy to click the buy button and put it on credit without considering whether you can actually afford it. You could remove your credit card information from the stores you usually shop at, as well as your internet browser if the information is saved there. Going forward, choose not to save your card information on a website. Then, when you’re about to buy something online, you'll be reminded to really think about if you can afford to purchase these items at the moment you have to re-enter your card information.

The same goes for shopping in stores. It’s easy to pull out your credit card and buy what you want. Most people with this behaviour think they'll buy it now and pay it off later. But this can become a habit, which means the amount that needs to be paid off later is much more than they can handle. Make it more difficult to mindlessly spend using credit. Don’t bring all your credit cards with you when you go shopping. If you use your debit card or cash, you'll become more aware of how much you’re spending. You’ll think twice about whether you can afford what you’re about to buy because you will not want to overdraft your account, or have a transaction declined.

You also have the option with most credit cards to lock your card. This will cause any transactions that are not pre-authorized to decline. Although it’s easy to unlock your card, having a reminder about whether you can afford to purchase something can help.

Though it may feel impossible to get out of debt sometimes, don't give up. Even if you're only able to make small efforts to pay it off at the moment, remember that it's all going to add up in the end. If you consistently make at least a small effort, you'll be in a much better position to improve your financial health eventually. Speaking with a financial professional, like a Certified Cash Flow Specialist, can help you get on the right track if you’re feeling overwhelmed. These experts can help you figure out how to pay off debt, save for retirement, and achieve other financial goals. Face your debt head-on and get more life out of your money by making meaningful behavioural financial changes.

Are there areas of your financial capability you’d like to improve? Check out our on-demand Financial Capability Series. Topics include: 

About CacheFlo

CacheFlo is a financial education company that builds eLearning and tools to help financial professionals and individuals make behaviour-based changes, which allow them to get more life from their money. We want to make it easier for people to predict the impact of their financial choices before they make them.

About the Certified Cash Flow Specialist (CCS) program

CCS professionals go through enhanced cash flow-based training to develop the skill set to deliver behaviour-based cash flow advice. They start the financial planning process with a cash flow plan to genuinely help their clients get more life from their money.

About the Financial Capability Program (FCP)

The FCP combines quick and practical lessons with tools, including Winton, which helps people make financial changes they can stick to. Users can apply what they've learned to their financial situation, thus bridging the knowing-doing gap. The goal of the FCP is to help people get more life from their money.