How to Get Out of Debt: Strategies That Work
Getting out of debt is less about finding one clever trick and more about picking a method you'll actually stick with, then applying it consistently.
Snowball vs. Avalanche
The debt snowball pays off your smallest balance first, regardless of interest rate, building momentum through quick wins. The debt avalanche pays off your highest-interest debt first, which saves the most money mathematically. Snowball tends to work better for people who need visible progress to stay motivated; avalanche is the cheaper method if you can stick with it despite slower early progress. Use the Debt Payoff Calculator on this site to compare both for your own balances.
Free Financial Counselling
If your debt feels unmanageable, free, confidential financial counselling is available through the National Debt Helpline (1800 007 007), which can also connect you with a free financial counsellor near you. Many banks also have dedicated financial hardship teams that can pause or restructure repayments temporarily if you're struggling — contact them directly and early, since options narrow the longer a debt goes unpaid.
Stop Adding to the Problem While You Pay It Down
Paying off debt while continuing to add new balances to a credit card undoes the progress. Where possible, pause new borrowing on the debt you're targeting, and build a small buffer (even $500) alongside repayment so a minor emergency doesn't send you straight back to the card.
Frequently Asked Questions
- What's the difference between debt snowball and debt avalanche?
- Snowball pays off your smallest balance first for quick motivational wins; avalanche pays off your highest-interest debt first to minimise total interest paid. Avalanche is cheaper mathematically, but snowball can be easier to stick with.
- Where can I get free debt help in Australia?
- The National Debt Helpline (1800 007 007) offers free, confidential financial counselling and can connect you with a financial counsellor near you.
- What is financial hardship assistance?
- Most banks and lenders have a hardship team that can temporarily pause or restructure your repayments if you're struggling — contact them directly and as early as possible, since options narrow the longer a debt goes unpaid.
- Should I keep saving while paying off debt?
- A small buffer (even a few hundred dollars) is usually worth keeping so a minor emergency doesn't force you back onto a credit card, but most of your spare money should go toward the debt itself, especially high-interest balances.
Informational content, not financial, tax, or legal advice. Verify amounts, limits, and current conditions directly with official sources (ATO, ASIC, APRA) before making a decision.
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