How to Get Out of Debt with No Money

Trying to pay off debt when you're on a shoestring budget can feel like an impossible goal. Aside from the basics like rent, groceries and gas, there are always unexpected expenses (think medical bill or car repair cost) that threaten to set you further back. Adding debt on top of a paycheck-to-paycheck lifestyle, and it can all truly feel insurmountable leaving many to feel it's impossible to get out of debt with no money, and better to declare bankruptcy.

This is not the right answer and I'm going to show you why.

So how can you get out of debt with no money? Start by following the five tips below.

Review Where Your Money Really Goes

Finding extra cash to pay down debt begins with understanding where your money is actually going every month. It's not something you should try to estimate in your head.

Look back at your last three months of spending, and you may be surprised at what you find. Perhaps you spent $150 on clothes or close to $200 eating out at restaurants. It can be surprising to see how quickly little purchases add up.

Considering signing up to use a budgeting software such as Learnvest to help you understand your spending habits and create goals for the future.

After all, the first step to getting out of debt when you have no money is to make sure the money you do have is being spent wisely.

Get Out of Debt with No Money By Cutting Items from Your Budget   

While it's easy to complain about a tight budget, the truth is most of us have something we could cut. Start by canceling any services you don't need such as a music subscription service or online storage platform (think Dropbox).

Next review your fixed expenses. (Here's our tutorial on how to do this.) Contact multiple car insurance companies to see if you can lower your bill. Compare cell phone plans of different competitors to see if you can get a cheaper plan. Call your internet provider to see if they have any promotions that could save you money.

If you're able to reduce your monthly expenses even a little, make sure to use the extra money to pay off debt. Set up an automatic transfer to your credit card or loan account to avoid the temptation to spend extra cash. 

Consider a Side Gig

If you've reviewed your budget in depth and find you aren’t able to lower your monthly spending enough, consider increasing your income. They’re many different ways to earn extra money outside of your 9 to 5 job. (See our Pinterest board or Side Hustle category for more ideas on how to do this!)

You could babysit using a website like, become a tutor using, create your own blog or become a virtual assistant using a website such as

The possibilities are endless. Make sure to also check out our free email course on “4 Days to Side Hustle Success.” 

Create a Debt Repayment Plan

Once you’ve trimmed down your budget or found ways to earn some extra moolah, now you need a plan to pay off your debt once and for all. There are a few different ways to tackle your debt, (see our “6 Different Debt Solutions” post) but it’s important that you find a system that works for you and keeps you motivated. Our editor, Lauren Bowling, paid off $8,000 in 90 days by being aggressive and strategic!  

First, you’ll need to start by making a list of all your debts including credit cards and loans along with the current balance and interest rate for each account. Some financial experts recommend that you focus on paying off the debt with the highest interest rate first in order to save the most on interest in the long run. There are other experts who recommend paying off the account with the smallest balance first in order to stay motivated since you’ll feel that you are making progress.

Of course, you can also consider debt consolidation or working with a debt management company if your balances and interest rates are truly unmanageable.

Get a handle on your debt by using our free debt tracker. Click here to subscribe and grab the debt tracker and six other worksheets in our “Best Life Vault”!

Avoid Future Debt

Once you’ve got a handle on your current debt, you need to commit to not taking on new debt in order to break the cycle. This is definitely easier said than done. Consider removing your credit cards from your wallet so they aren’t accessible. Stop impulse purchases by making yourself wait 24 hours before buying something that is outside of your budget.

Also if you have no money in savings, any unexpected expense can send you scrambling for your credit card. Consider building a small cash cushion of $500 to $1,000 to cover emergencies. Any extra money (including a bonus, tax refund, or extra income from a side gig) can be split – half toward your debt and the other part toward building a cash cushion or emergency fund. 

Becoming debt free isn’t easy, and it’s even harder to stay that way. So while the question of how to get out of debt with no money may seem impossible, the truth is that with a little determination and creativity you can become debt free and a step closer to living your financial best life!


The age old question: I want to pay off debt, but I live paycheck to paycheck. Here's how to get out of debt with no money.

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  • Michael Welter
    May 7, 2017 at 7:36 am

    Paying off debt is challenging especially if you have a low income but with the right attitude and commitment, everyone can do it.

  • Mo
    May 2, 2017 at 2:53 pm

    I don’t know if you guys Ruthies but I have three questions. My first question is what do I need to consider aside from fixed interest rates if I’m consolidating a student loan?

    Secondly, I just got married so should I consider finding a way to merge our student loan debt into one payment?

    Finally, do you think it’s better to use my emergency fund to pay off the remaining balance of my car ($3700) now or pay it off slowly over the course of the year (+$500 interest)?

    • Lauren Bowling
      May 2, 2017 at 9:52 pm

      Hi Mo — I don’t think wiping out your total emergency fund is a good idea…after all, you never know what could happen and it could put you more in debt if you had to put it on a credit card vs. having cash on hand. Consider any fees the consolidation company is charging you and your monthly payment. Hope this helps!