6 Signs You Need a New Debt Payoff Plan

1. You have no current plan

If you’re making payments willy-nilly, your payments may not make much of a dent in your overall debt amount. When you have no plan, you’re just paying and hoping that one day the debt will finally disappear.

Create a strategy that shows exactly how much debt you have, which debts you’ll benefit from paying off first and a timeline for paying off each debt. Need help coming up with a debt management plan? Meet with a counselor at a nonprofit credit counseling agency in your area for suggestions and advice.

2. You don’t have a budget

To pay off debt faster, you need to know how much income you have, where it’s going and how to channel your money where it can have the most impact.

With no budget, you’re just guessing, and that’s no way to pay off debt. Meet with a financial counselor at a free nonprofit credit counseling agency for help creating a monthly budget.

Find out: How to Create a Budget

3. Your debt barely budges

When you make payments for years on a debt that barely shrinks, something in your strategy needs to change. Maybe your debt albatross is a student loan with payments that go mainly toward interest and barely touch the principal or you’re chained to a high-interest retail or other credit card.

Whatever the debt, contact the creditor or lender and ask how you can pay it off faster. Can you get a lower interest rate? How much do you need to pay each month to knock down the amount more quickly? Find out and revamp your payment plan.

Find out: How to Pay Off Credit Card Debt Faster

4. You’re paying unnecessary expenses

Pounding away at debt goes faster when you have more money to throw at the balance. Want to speed up paying off debt? Then cut those unnecessary expenses gobbling up your paycheck by redefining what “necessary” means to you.

For instance, you “need” to pay monthly rent or a mortgage payment. But you don’t “need” cable TV when you can pay that $100 saved each month toward a credit card to pay it off sooner. Take your lunch to work for a while and you can make even bigger payments. The sacrifices you make now will lead to more freedom later, once creditors are off your back.

5. You can afford only minimum payments

When you maxed out a few credit cards, you probably weren’t thinking about how much all those monthly payments would total each month. Now that you’re getting billing statements, however, you can barely make minimum payments. Yet making minimum payments each month can keep you in debt for years.

If you’re wondering how much interest you’ll pay and how long it will take to pay off a debt making only the minimum payment, read the “minimum payment warning” on your credit card statement for the bad news. Then pay more than the minimum to pay the debt faster.

6. You’re broke every month

Even though you want to pay off debt quickly, you still need money to live on once you make all those monthly payments. It does no good to be overly ambitious with larger payments toward debt if you must resort to charging more on a credit card midway through the month.

Try a plan that focuses heavily on one debt at a time while making smaller payments to other creditors. For example, you could try the “snowball method,” in which you focus on the smallest debt first while making small payments on other debts. When the smallest debt is paid off, move on to the next highest debt, adding the amount you were paying on the paid debt to the next debt’s monthly payment amount.

This article by Deb Hipp was originally published on Debt.com.