Managing Debt

Actionable phases to move from crisis to freedom: triage, stabilize, rebuild, and strengthen.

PHASE 1: Triage

  • Inventory debts: list balances, rates, minimums, and due dates.
  • Protect essentials: prioritize housing, utilities, food, and medical costs.
  • Immediate relief: contact creditors to request hardship plans or temporary forbearance.
Reduce urgent pressure so you can plan.

PHASE 2: Stabilize & Negotiate

  • Create a budget: map income to essential costs and see what's available for debt repayment.
  • Negotiate: ask for lower rates, settlement offers, or payment plans in writing.
  • Choose a strategy: avalanche (high-rate first) or snowball (small wins first) depending on motivation.
Small, steady payments rebuild control.

PHASE 3: Rebuild

  • Automate payments: avoid missed payments that add fees and damage credit.
  • Save a buffer: build a small emergency fund to prevent future reliance on credit.
  • Track progress: celebrate milestones and adjust plans as income or expenses change.
Replace reactive debt management with predictable habits.

PHASE 4: Strengthen & Protect

  • Improve credit health: check reports, fix errors, and gradually rebuild credit mix.
  • Plan for shocks: maintain a 3–6 month emergency fund and insurance where appropriate.
  • Financial habits: revisit budget quarterly and keep priorities aligned to goals.
Focus on resilience, not just repayment.