HomeDebtThe most comprehensive guide on "how to become debt free" ever written.

The most comprehensive guide on “how to become debt free” ever written.

And now, as promised, The most comprehensive guide on “how to become debt free” ever written…

Spend less than you make.

-The end.



  1. He he, simple as that. Stop spending recklessly and try to earn more if possible to accelerate the process. And set zero overdraft on your credit cards. That does the trick for me 😀

  2. Ummm….I always thought it was earn more than you spend. What gives? Why does Ninja get to re-write the rules?

  3. “Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”

    – Mr. Micawber in Dickens’s “David Copperfield”

  4. Ninja you’re going to kill a lot of PF blogs and talks with that secret. What is there left to talk about? 🙂

  5. Oh, Ninja. I hate to use the word “privilege”, but WOW is your privilege showing.

    What about the people who have massive debt from medical emergencies because they can’t afford health insurance? What about the people who barely earn enough to cover basic living expenses, but still face debt from medical expenses, student loans, or credit card debt from an emergency purchase? I’m incredibly careful with my money and savings, but I don’t make a lot of money (I’m a full-time student with a part-time job), and if I suddenly had to make a major repair on my car, that could put me in some serious credit card debt overnight. There is so much more to debt than just spending versus earning, and to say otherwise is really just ignoring the huge amounts of other issues that contribute to debt.

    I’m leaving comment notification on…I really hope I don’t get flamed for this.

    • In all of those situations, spend less than you make still works. Or if you want to wordsmith it a little bit, make more than you spend. If you only have enough money to pay for basic necessities and still have lots of debt, then you’re gonna have to figure out a way to earn more money so you can get to the point where you spend less than you earn.

      However, you do raise a valid point about emergencies. All the frugality in the world can’t overcome costly accidents. Maybe a comprehensive guide to “getting out of debt and staying out of debt” would be to “Insure yourself against catastrophic loss AND spend less than you earn.”

      • But not everyone is ABLE to earn more money than they already are, and assuming that everyone is able to do so is just wrong. I have several friends who suffer from chronic medical conditions who work 60 hours a week just to pay their bills, and still have debt, and physically CAN NOT work any more than they already are. How are they supposed to make extra money? They have nothing left to sell. I’ve looked at their budgets, and there is no extra money there to go to debt payments. Some of them might be filing for bankruptcy soon for lack of any other option. Situations like these–especially considering the mess that is health care in this country, and the social stigmas that come with chronic, often “invisible” medical conditions–are way too common, and too often get swept under the rug because people still like to believe that it’s possible to pull oneself up by one’s bootstraps, but it’s really freaking hard to do that when you don’t even have boots.

      • I would not flame Shelly at all, quite the opposite. Kevin’s optimistic prescription does not take into account, for example, the hefty costs involved in self-insurance. Health care is obviously the most significant issue. During the one 6-month period I was out of work in 1991, I continued my health coverage under COBRA to the tune of $300 a month. Today the same coverage would cost me $800 a month.

        And let’s not forget all the employers who provide no health care insurance at all, a situation Obamacare tried desperately to rectify, with an outcome that is still uncertain.

        But even having insurance through one’s employer is covering less and less these days. I have seen my co-pays, deductibles, and payroll deductions rise appreciably through the years. Earlier this year, Andrew Sullivan’s blog ran a set of stories about the high costs of dental care. I can’t find the one right now I most want (if I do so I’ll follow up), but here’s a pretty good one:
        It starts, “My family suffers from a genetic disorder that causes enamel dysplasia.”

        • Ah, yes. Here’s the post I really wanted. I’m quoting it nearly complete, in hopes it stops some of the facile comments about simply “spending less than you make”:

          “You’re absolutely right about eyes and teeth being critical body parts. And it gets worse than just tooth pain – as you may remember, in 2007 a 12 year old boy named Deamonte Driver died of a brain infection caused by an untreated tooth infection.

          “I’ve had my own struggles with the dental health care system, though nowhere near as dire or heartbreaking. In 2006, at age 26 and just out of school, I was diagnosed with a rare jaw tumor called ameloblastoma. I had health insurance at the time, but because the tumor happened to be in my jaw, most of my treatment was considered dental rather than medical. A few months later I found myself with tens of thousands of dollars of debt, and a surgeon who stopped providing follow-up care (or returning my calls) when I was unable to pay her.

          “I spent the next few years trying to find a way to obtain the tooth implants I needed to replace the teeth I’d lost and, more importantly, secure my bone graft. I spent hundreds of hours making phone calls and chasing down leads, none of which worked out. Along the way, I even picked up dental insurance – but it considered the work I needed to be medical in nature, just like my medical insurance considered it to be dental in nature. Finally, in 2009, my bone graft had degraded to the extent that I needed to have a third one done to augment the remaining bone – so, thanks to an insurance policy loophole stating that they wouldn’t disclose my coverage for the procedure until after it had been done, and a masterful doctor, I was able to have both the bone graft and the implant bases taken care of in a single, six-hour surgery. It was an enormous relief. However, it also added several thousand more dollars to my debt.

          “And I still needed the teeth themselves – without them, I’d lose the top teeth on my left side as well before too long. So it was off for another year and a half of fruitless calling, haggling, sweet-talking, chasing, and begging. Then in July of 2010, my grandfather died. I received a small inheritance from him, enough to cover two things: my teeth, and a bankruptcy attorney. I’m scheduled to have the teeth affixed on February 11.

          “For want of a 50% deposit of $3500 in February 2007, as of February 11, 2011, I will have received approximately $41,000 worth of care from the health care system. That’s not counting the tens of thousands of dollars of tumor-generated debt prior to that date. Much of that will be liquidated in bankruptcy — I’ve been waiting to declare bankruptcy for over four years, but it would have been highly unwise to do so prior to the completion of my oral reconstruction. . . .

          “To reiterate: I’ve had health insurance this whole time. I’ve had dental insurance since January 2009. But because the systems are split, they each get to point at each other and say ‘Not my job – theirs.’”

          • Absolutely agree, not everyone can earn more money or spend less than they earn. I have a chronic condition where I am only physically able to wokr 10 hrs a week…and even that is tough. My out-of-pocket medical costs are $40,000 per year AND I have insurance. This is a chronic condition and not an emergency. I got sick one year after college. Luckily I had saved 20k from one year of working and I blew through that for medical care in a matter of months.

            It’s easy to judge others and provide simple solutions when you are not the one going through the mess.

            Thank you so much Shelley for bringing up the stigmas of “invisible illnesses”. Your friends must be so grateful for your level of understanding!!

          • @Sandy. There was no judging. Literally none. I wrote five simple words. The only way anyone can get out of debt is by spending less than they are earning. I didn’t say EVERYONE CAN get out of debt, but only that this is the only TO get out of debt. Do you really expect me to write caveats for every type of person that may have a special or different circumstance?

            Comment from Melissa down below says it best…

            “Wow! Of all the posts, I wouldn’t have guessed this one would cause so much dissent.

            The only way to get out of debt is to spend less than you make. It’s a concept.

            That is a completely separate than an opinion on whether it’s possible for everyone to do so- this is the implementation part. Now whether implementation of aforementioned concept is doable, it’s very situational, and no advice will ever be able to help everyone in every different situation.”

            Where was the judging? WHERE?!

          • @ninja…for some reason, there’s no “reply” button for you response, so I will reply here.

            I probably should have mentioned that my comment wasn’t meant for you. I totally get you weren’t judging at all and I understand that you cannot write caveats for everything. 🙂 I thought this post was awesome especially since that’s pretty much the philosophy I was raised with. I just got super annoyed at some of the comments that are filled with Horatio Alger myth (anyone can go from rags to riches if only they worked hard enough) and felt like I needed to respond.

            My comment was actually meant for Kevin, where he replied to Shelley where he writes “in all of those situations, spend less than you make still works”. No, it does not work in those situations described. We can’t spend less (without completely forgoing medical care) or make more (um…we’re too sick to work).

          • I am sympathetic to people with health issues and I do understand that they can be very expensive. However, it doesn’t make Ninja’s statement less true. He did provide the only way to get out of debt.

            And concerning my statement about insuring yourself against catastrophic loss, I wasn’t only talking about medical insurance. Long term disability insurance should also be included in a comprehensive insurance plan against catastrophic loss, and would provide income for someone with a chronic condition. Whether that and health insurance is enough to keep that person out of debt will depend on the individual’s situation, but to suggest health insurance is the only insurance needed to protect against catastrophic loss is false.

            And finally, I agree with Ninja in that it’s not necessarily possible for EVERYONE to get out of debt, but if they are going to do it, it will be by spending less than they make.

    • The best news is that you will not be a student forever and hopefully whatever you are going to school for will allow you to make more income after you graduate. Keep plugging along and then once you graduate and get more income your log jam will break free in a big way!

    • I honestly can’t believe “privilege” is being thrown around right now. I didn’t say EVERYONE has the ability to be debt free at the snap of a finger. Nor did I say that it is easy to be debt free. But there is no denying the ONLY way for someone to pay down their debt is if they spend less than they take in. Period. If you do that, you by default have extra money to put towards debt.

      Sure some people don’t have the ability to spend less than they make, and emergencies definitely do happen. Again, I didn’t say everyone can be debt free, only that this is how one becomes debt free.

      Have you ever met anyone that became debt free by spending more than he earned month after month?

      Privilege or not, it’s truth.

      • Well, yes, it’s the truth. So is: “if you eat fewer calories than you take in, you’ll lose weight.” Duh, I had no idea, and no wonder we have so few obese people walking around (or rather sitting on their couches) in America today. Problem is, such cavalierly stated advice is not likely to help anyone having the problem, which may have a variety of causes including poor financial education, psychological factors that lead to overspending, or an overwhelming burden of debt beyond the person’s reasonable control.

        • You use to be much more neutral in your opinions in regards to your commenting, even defending me at times. Now it seems, no matter what I write, you just like to play the antagonist. What gives?

          • And in case it wasn’t obvious this post wasn’t written with the intention of solving the worlds problems. Of all people, Larry, I expected you to pick up on that.

          • Regarding the second comment (10:54), no dispute. I was merely trying to offer some understanding as to why Shelly reacted as she did.

            As for “defending you,” look back to comment 3, where I quote Dickens on your behalf.

        • “Problem is, such cavalierly stated advice is not likely to help anyone having the problem…”

          I must disagree with you. I think the problem is what marketers would call “noise.” Using your calorie example, the calorie deficit rule almost ALWAYS applies. The vast majority of the population would certianly benefit to hear “Just eat less of what you already eat and you will see results.”

          Why don’t people just eat less? It is because of noise. People are told that they need this diet or that diet. They are told so many things that they forget that all of those diets still follow the calorie deficit rule. Other factors outside of one’s control might make it harder to follow the rule (for example, hormones slowing down the calorie burn), but the rule is still valid. Now let’s bring this back to finance…

          Basic math says that you can make debt payments as long as you have a surplus of money. It does not matter how you get that surplus (Better job, more frugal life, receiving a gift), the rule still applies. Other factors might make it hard to follow the rule (such as emergencies), but the rule is still valid and should be taught.

          Remember, we still teach people to get 7-9 hours of sleep every night even though there are outliers that need more or less sleep.

      • All men are created equal does not mean that all men are created with equal abilities.

        It is a total cop out to suggest that it’s anyone’s fault but your own to have debt (which I have way too much of). No one forced me to take out a ton of loans to go to college and only work part time while there. No one forced me to use credit cards with a full understanding of the consequences but the naive hope that I’d make enough later to pay them off quickly. No one forced me to have 2 car loans. And no one has forced me and my wife to have to buckle down with salaries that suggest we should be just fine in order to pay for the sins of our past. We did this to ourselves, and we’re going to get ourselves out, no one will do it for us.

        It is incredibly frustrating to me to see people say that they can’t get out. If your medical bills are so overwhelming you can’t survive, there is a last resort mechanism called medical bankruptcy that may help. To say that the Ninja is wrong is a cop out. Take responsibility for your life and get after it.

        No one can make you miserable, you can only do it to yourself. No one will make you rich, but you can do it for yourself.

  6. Love it! It caught my attention. This is the K.I.S.S. method – keep it simple silly (or stupid) whichever your prefer.

  7. Amen brother!!! I’ve written a 137 page, 4 audio cd personal finance course that says exactly that (with slightly more detail, of course!)

  8. i have to agree with Shelly, there are some things you cannot plan for or simply cant get out of. Granted, i am speculating here, i think most folks could cut out the non-essentials and save/pay off debt rapidly. however some times and in some situations even cutting budgets to the bone you still come up short every month. My folks had to forclose on their home because of a medical emergency and subsequent in ability to work for 6 months, long term disability insurance helped but wasnt enough. in this case spend less than you make wouldnt have helped. i think this would be your 100K emergency blanket situation, which most people will never have.

    What about a couple with out proper family planning who has several kids and the parents didnt graduate from college, read do not make much money, and are scraping by. now i wouldnt agree with how many kids a couple has without the ability to provide for them but this happens all the time, just look at the 16 and pregnant show. Kids are expensive, and this couple is relegated to a life of debt.

    making it sound so simple sounds great but its a complicated subject

    • Sure some people don’t have the ability to spend less than they make, and emergencies definitely do happen. Again, I didn’t say everyone can be debt free, only that this is how one becomes debt free.

      Have you ever met anyone that became debt free by spending more than he earned month after month?

      • i guess its apples and oranges here,

        you are coming at this from the very basic level, spend less than you make and you have extra money, which is 100% true

        i am coming at this from seeing situations beyond a person’s control where the ability to spend less than you make is not possible, which can also be true

        These are not the same topic, i think we are both right, but on fundamentally different topics

  9. Really Peeps? The rule is the same….it is the standard and as with all standards there will be exceptions to the rule. I also went through large medical debt and after getting out from under that switched jobs for better insurance and we we pay for double insurance from both employers extra money right off the top but worth it in the end.

    There will always be someone who knows someone who “just can’t” spend less and that is where community and family come in.

  10. Ninja has his flaws, but today I don’t think his post comes from the mind of a priviledged person. It comes from that of logic. As unfortunate as it is, the very difficult and complex situations mentioned still require the same solution to get out of debt. For some people, maybe it means they cannot get out of debt. However, it doesn’t change the solution.

    The truth is the truth no matter if you know/believe it or not. If one learns later in life that they should spend less than they make but now they have debts that seem insurmountable it doesn’t change the fact that they needed to spend less than they made to be out of debt (spending less than you make also allows you to save what you don’t spend in case of emergencies). So for the improper-family-planning couple who are scraping by, the solution is still the same. But it sucks that this information wasn’t available before children OR didn’t move them to refrain from having children before they could properly afford them OR otherwise carve out a life where what they could afford was enough. (Sadly, in a large number of lives-rich or poor- the latter is the biggest challenge.)

    To expound further would require much more space and time and that’s why pf blogs will continue to exist. Because there are almost always exceptions to a rule bust mostly because a simple solution still requires extensive explanations sometimes.

  11. Shouldn’t you included have an emergency fund? As previously stated by many others life happens, would be nice to be even a little bit prepared. 😉

    • If you are spending less than you make, you are by default saving. Which in turn means you are building up cash reserves, also known as an emergency fund.

  12. Plenty of people have situations and experiences to refute such a simplified rule for personal finance. How many of them have IPhones, XBoxes and car payments? If you’re even replying to this post then you’re likely not living in a cardboard box, unless you happen to live next to Starbucks and leach off their free WiFi with the laptop some gilded 1%er tossed aside.

    The military is always hiring and has great medical benefits (zero dollars out of pocket), I know from personal experience.

    Not trying to flame anybody who has issues preventing them from living within their means, but I believe more often than not people have more influence on their situation than they would have you believe.

    • You are right in some ways. I know tons of people who complain about student loans, yet they have smartphones, cable, and a nice. These people are healthy and able to get out of debt if they would just stop making excuses for themselves.

      But as for me and many ill people I know, we don’t waste any of our money on those things. I have a regular cell, no landline, an old computer with internet which I absolutely need as my doctors send me emails all the time, no cable, no car, and I live with my family to save on housing. I never eat out nor order out. No coffee, alchohol, or sweets, only the most basic foods. That’s how most severely chronically ill people live, and they are often in debt for medical reasons and physiclaly unable to work to get out of debt. There is NO WAY we can join the military with our health limitations. We often have to choose between medical care vs. basic necessities like food. Health insurance often have many loopholes so they don’t have to provide coverage. Sure, something common and simple like knee surgery or appendicitis they are going to cover because it’s a one time deal. But for chronic illnesses, many health benefits will not cover IV’s for expensive medications, speciality medications, etc.

      So yeah I totally agree that there are a lot of lazy whiners out there who have the ability to get out of debt but they just make excuses. However, there are still many people who really have no control over their situation. Please do not group all of us together.

      • If you can sit on a computer long enough to participate in a forum post, not being able to work is not an excuse you can use. I happen to know someone who is a paraplegic and yet they spend their days writing stories (well, speaking them via voice interpreting software) and doing other useful income generating things online. I’m not saying that spending your time online is the only way to work if you are ill, either, I’m just saying that as long as you can move and have your mental faculties I’m not completely sympathetic to the “I have an affliction, therefore I am the exception” mentality. Sorry to come off as harsh, but I am a strict believer that, at least here in America, a person is their own limiting factor. It may not be equally easy for everyone, but very little is impossible.

        • @ Rob. No you didn’t come off as harsh, you came off as an ignorant prick.

          I am studying to be a social worker and the above commenter, is one of the patients I work with during my rotation.

          We did not meant to imply that the sick and disabled are excused from all responsibilities, but that sometimes, no matter how hard we try, there are factors outside of our control that limit our ability to get out of debt, such as a life long disabling illness.

          It seems like your mental facilities are functioning fine, so how come you didn’t figure out that you cannot accurately judge what someone can or cannot do through a forum post? The reason I use “we” in the above paragraph is because Sandy’s lifelong illness has made it so that she cannot sit or stand, use the computer, read, form sentences, type, or do a million other things. I help her participate in this discussion by reading to her (sometimes repeating myself several times), forming sentences from the words she manages to throw at me, and then typing it for her. Luckily this is a topic I feel strong about, so it was easy to read her mind. She is in the hospital up to 6 days a week for various treatments and tests, so even though she is able to “use” the internet with my help, the rest of her downtime is spent recovering in bed. How and when do you expect her to work enough to cover $40,000/yr of medical expenses?

          There are other patients who are able to use a computer on their own for 10-30 minutes and even chat online. But they literally pass out and are completely nonfunctioning afterwards (sometimes for days) because they are so wiped out from the effort it took to do that. Many are war vets btw, lest you think they are weak. Just because someone is capable of doing something for a short period of time, doesn’t mean that they are able to do that on a regular basis. So NO, being able to participate in a forum post does NOT equal the ability to work.

          You probaby think that if you were any of those patients, you would be able to do better and do more, that you would not let something as silly as severe illness/disability prevent you from reaching the stars. I wish you could switch bodies with them for a week, I’m certain you’ll change your mind within the hour. Pull your head out of your a$$ and don’t judge something of which you clearly know nothing about.

          @ninja, I have no problem with your post. Sorry to veer off topic, But Rob’s comment was so insanely ignorant and insulting, I could not ignore it. Guess it’s the future social worker in me. Promise no more comments from me! 🙂 I’ll be graduating with student loans into a low-paying field. Thnks to PF blogs, I realize I’m going to have to figure out a side hustle to make extra $$…

          • Without resorting to the need for childish name calling, I will simply say that I am sorry that I seem to have struck a nerve with you. The world is not black and white, as seems to be what is commonly interpreted when people read forum posts. Do I expect someone who is essentially in a coma 99% of the day to push forward and become the next billionaire? Heck no. Is there an exception to just about everything? Of course. If you’re in the position where you’re barely cognizant for the majority of your time, chances are you have better things to worry about than getting out of debt or amassing piles of cash. This is where people like you, ms/mr. future-social-worker, come in. You are the assistance for this individuals, their help in their inability to do much else.

            I’ve known many people with many varying degrees of illness from hospital ridden to what have you, and the blunt and simple truth of it is that many, many of them can and should do more than they do. Sure, you can give me a hundred stories of people who are only alive because they’re undergoing an operation every 45 minutes as an extreme counter-example, but I can give you a thousand examples of people who have been injured or are sick in such a way that life is more difficult for them than others, and achieving their dreams through work they love is either physically impossible or highly improbable, but they are still capable of doing more but have taken on the victim mentality.

            Your patient Sandy, the one for whom you so painstakingly write, the one who is probably fairly grateful to you for doing so, commented on “invisible illnesses,” and thus it was a pretty straightforward mistake to assume that she is in a position where her illness is, well, invisible. Bed-ridden, unable to speak, and having difficulty formulating sentences does not say “invisible” to me, and of course I do not expect her to go “well, he thinks I should do more, suddenly I’m all better!” So you can take my apology for assuming that she was speaking under her own power, but take your own advice, don’t judge someone from a single forum post. Calling someone you’ve never met an “ignorant prick” based on broken interpretation of an opinion is assuming, unwitting, and frankly revealing of a temperment of one who is quick to judge.

            But more to the point, as Ninja has stated, the way to become debt free is still to “Spend less than you make.” Whether or not debt freedom should be your goal, obviously that depends on your situation. If your life is in constant peril, you have better things to think about.

          • Rob: “Also, I have to agree…. of all the posts, why is everyone so worked up over this one?”

            Because, I think, it can be read in two very different ways:

            a) As a simple statement of indisputable fact, implying nothing about how easy or difficult it is to achieve the desired goal.

            b) As an over-simplification of a complex and sometimes insoluble problem, with the implication (intended or not) that if one fails to achieve this goal, one is a failure.

            That said, I would draw a line between those who are in debt due to financial ignorance or inability to control their spending habits, and those who are in debt due to health or disability reasons beyond their reasonable control.

        • I think we all already agree that while Ninja’s post provides sound advice, there are always exceptions.

          @Rob With all due respect, I did find your posts to be quite offensive. It is okay for us to say someone isn’t getting out of debt because they are not doing things that they have control over, such as limiting their spending on clothes, cars, smart-phones etc. But it NOT ok for us speculate whether or not a person actually CAN do more based on nothing more than what we perceive of how sick or how severe their illness is.

          That is essentially what an invisible illness/disability is – a disease of which we cannot tell how much a person is suffering just by looking at them or by the name of their condition. Visible illnesses are when a person is in a wheelchair, lost their hair in chemo, or pushes around an oxygen tank – things that you can physically see. It has nothing to do with the severity of the condition. Something sounding as silly as Chronic Fatigue Syndrome can sometimes be much more disabling than cancer or paraplegia, even though the person may not look sick. “Sandy’s” illness/disease may sound very visible to you, but all those things you pointed out – bedridden, unable to speak, or formulate sentences – are invisible. If you were to see her at home sleeping in bed in the middle of day, she may come across as “lazy” and “stupid” rather than seriously ill. I am guessing that is why she identifies herself as having an invisible illness.

          P’s comment, while temperamental, does make a point- you cannot accurately judge what a personal is capable or incapable of doing because you are not in their bodies and you do not see the details of their day to day life. Like you said, the world is not black and white. My mother has an invisible illness, and growing up, it would infuriate me to no end when people made those kinds of judgements – nevermind that she was a surgeon and a mountain climber prior to becoming ill.

          This experience greatly affected our household’s PF growing up. You would not believe the barriers we had to face with SSDI and getting other support and services because there was this “You can’t be THAT sick, you don’t look it, stop playing a victim, it’s not like you have a tumor, you should be able to work from home if you would try harder” kind of mentality. This experience is the norm, not the exception, for the severely ill with an invisible illness.

          There may be people that you don’t consider to be really ill, but how can you know for sure??? Things are not always what they seem. Granted, there are people who do play the victim and even cheat the system, but I’m going to guess that it is not as often as you seem to imply it is. Now that I am older, I am doing all that I can to help out financially, but the expenses are still immense and will only continue to grow.

          I sincerely hope you rethink your “You don’t look that bad/you’re not hospitalized, you can do X therefore you’re just not trying hard enough and playing a victim” snap judgement mentality, maybe even educate yourself on what it means to have an invisible illness.

  13. Wow! Of all the posts, I wouldn’t have guessed this one would cause so much dissent.

    The only way to get out of debt is to spend less than you make. It’s a concept.

    That is a completely separate than an opinion on whether it’s possible for everyone to do so- this is the implementation part. Now whether implementation of aforementioned concept is doable, it’s very situational, and no advice will ever be able to help everyone in every different situation.

  14. This is similar to advice about how to lose weight! Burn more calories than you take in. If it were only that simple. Well it is!

  15. HA! It’s so true it’s almost not funny. But yet it’s hilarious….

    Best. Get out of Debt. Post. Ever.

  16. Well, actually…. the post should have been:

    The only way two ways to get out of debt are: a) spend less than you make OR b) write a book about how to become debt free by spending less than you make.

  17. I can feel for any of the EXCEPTIONS you guys mentioned here. But let’s face it. A lot of Americans are in deep trouble for spending like crazy on stuff they didn’t actually needed. We’re not talking here people who are victims of your sinister health insurance system. We’re not talking people with tumors, these are exceptions.

    MOST AMERICANS have maxed their credit cards to pay for the holidays. Or go in a nice vacation. Or just buy the next iPhone, even if the one they have works perfectly fine.

    These are the people we talk about here. The ones who care in trouble and expect miracles. Well, sorry to burst your bubble, you got yourself into it, you have to get yourself out of it. I’ve had money issues my own life, because my family was poor and didn’t have too much inspiration about using money to their advantage. I assume this is why we were actually poor.

    What did I do? Got a second job. Stopped spending like crazy, started saving.

    It’s been years since those nasty moments when we couldn’t even afford new shoes for me. And not fancy ones, just regular sport shoes to get me through the summer. I earn well now but I am very careful with my money. I have bought some gold, for the future, I have savings, I have ZERO overdraft on my credit cards and spend just as much as I need for us to eat and live like a normal family.

    So yes, the equation actually works. Stop making excuses, start making smart decisions.

    I agree there are unfortunate people, like the ones you mentioned here. They are not the norm. The norm is a majority of people who take years to pay for their credit cards maxed out for clothes. Or gadgets. Or a house they never afforded, but had to have it.

    Learn from this, if you will or keep on making excuses 😉

  18. […] The most comprehensive guide on “how to become debt free” ever written. by Punch Debt in the Face […]

  19. […] Punch Debt in the Face – The Most Comprehensive Guide on “How to be Debt Free” Ever Written. […]

  20. I’m coming into this conversation kinda late, but it seems to me like it got really off track. If you have debt, the only way to pay it off is to spend less than you make and use the difference to pay off the debt. I’m not sure why that’s controversial.

    Some people aren’t in a position to bring in more money or reduce expenses because of serious medical conditions, family commitments, etc. Again, this is not controversial. These people remain in debt.

    You may or may not think this is right – and actually, if you’re as physically disabled as some of the other commenters are suggesting, bankruptcy is probably our best option; even student loans will be discharged in these cases – but it doesn’t change the reality that spending less than you make is the only way to get out of debt.

    WTF is everyone so worked up about?

  21. Obviously I’ve been doing it all wrong – if I want to start a comment conversation on my site, apparently I need a post that says “The sky is blue. The end.” Then people can argue that it’s nighttime where they are, or that their sky is cerulean or gray or sky blue. Good grief.

    As for Sandy’s social worker in training, as a LCSW I have to wonder whether your supervisor knows you are posting on blogs on behalf of your clients. To me, that’s a huge boundary violation – if Sandy is unable to type/speak her own thoughts and you are turning a few words into paragraphs while you “read her mind,” you risk putting something on the internet that was far from what she intended. You are opening yourself and your agency up for malpractice suits. Personally, I have a feeling you are a troll trying to start stuff, but if not, you might want to rethink what you’re doing. You aren’t “helping” clients by attributing your opinions to them.

  22. Ninja’s post is essentially a math equation (which I write in pseudo code form, since programming is much of what I do these days):

    function debt_success(earnings, savings)
    if earnings spending
    “you’re getting out of debt”
    %% earnings == savings
    “you’re a ninja at balancing your checkbook”

    • Somehow my comment got all bungled after posting. It got rid of my ‘greater than’ and ‘less than’ characters, erased lines, and got rid of indenting. Oh well.

      In words…
      If earnings are greater than spending, you’re getting out of debt.
      If earnings are less than spending, you’re getting into debt.
      If your earnings are equal to your savings, you’re a ninja at balancing your checkbook.

      People’s individual circumstances can vary, and medical issues are particularly thorny as they don’t have price tags. However, I think the tone of Ninja’s post is more poking fun at the complicated advice sometimes given by finance gurus, not trying to disparage anyone who may be in debt for whatever reason.

  23. As I’ve been thinking about this more, I have come to the unfortunate conclusion that you are wrong Mr. Ninja. Here’s another way to get out of debt:

    Spend way more than you make using credit cards and other loans that are charged off in bankruptcy, and then declare bankruptcy.

    Boom. Spend more than you make and end up debt free. What do I win?

    • You have to be really careful with that method, though. You can’t buy anything secured, because you’ll have to give it back in the bankruptcy. You also have to keep your personal belongings below the exemption threshold for your state – you literally have to list everything you own and assign it a value when you file. So you can’t own five cars or anything. THEN you have to make sure your income falls within guidelines for Chapter 7; otherwise you might have to file Chapter 13 and go on a five-year payment plan. And student loans? You can’t get rid of them, so you would have to have the forethought not to go to college for this plan to work.

      Personally, I think the idea of bankruptcy is too complicated as a way to get out of debt. There are too many variables, and who has time for that? People who can’t be bothered to spend less than they make aren’t going to put forth the time and effort to make sure they file bankruptcy without holding onto some of their debts. Thumbs down – this method is too difficult. =P

  24. […] at Punch Debt in the Face offers a comprehensive guide on getting out of debt.  It seems that the comments will take the majority of your reading time, […]

  25. Thank you for the insightful post that has opened up a bunch of discussion. Debt is a HUGE issue in the country for both the average joe and the FEDERAL GOV. You have to ask yourself at some point what kind of leadership we have if we have a FED. DEF. at the degree that we do?

    I believe the debt issue starts with looking deeper at one’s past and understanding one’s own relationship with money. -How has that lead to the emotional decisions today we have about money?

    Good Luck,

  26. Well, I haven’t read all the comments, who would have thought that such a simple post could cause such controvercy?

    It is true, that is the way to get out of debt, and many people have been made rich by writing books making it seem more complicated than that.

    You are doing a good job Ninja, I appreciate your posts

  27. Yep, I’m surprised by the controversy in this post, too. Maybe truth is tougher to hear when it’s not couched in 500 if’s, and’s and but’s.

  28. These are interesting comments from such a small little post. But here’s the kicker…who is more miserable, the person that spends excessively beyond their means with no concept or desire to ever get out of debt, or the person in lots of debt that works endlessly to pay it down?

    Let’s look at the person that endlessly pays off their debt. Let’s assume that this person earns $100,000 yearly and has $100,000 in debt with a payment on this debt of $1000 monthly. He or she still has $88,000 a year to live off. Why should he or she care that their debt is not paid? What’s their incentive? If they used an extra $2500 a month over the next 3 years to pay down their down, they would effectively “lose” out on $90,000 just so they could retrieve $1000 a month again.

    I’m not saying that people shouldn’t pay off their debts, nor am I oblivious to the fact that any monies not going towards debts is potentially cash flow. What I am saying though is it seems that every Personal Finance Blogger, with the exception of me, of course, seems to thrive on one principal alone: Be Debt Free! Attacking debt is great in theory, but there is a time and a place to start a debt-free adventure.

  29. Ninja, this is one of the best posts ever. Not even for the PF advice, which got you into a lot of trouble, but for the message to bloggers!

    Every time I sit down to write, I’m going to have this post in the back of my mind. I don’t want to be guilty of over complicating an issue just to fill out a post.

    As for the crazy comments, I can’t believe that this post caused so much anger! No one can deny the truth of what you said. Everyone wants to make more of it than is really there. What you stated was the undeniable truth, and nothing can change that. I am really shocked at the reaction!

  30. Very well said. 🙂 Two-thumbs up for the greatest advice I received today! Others maybe pessimist about it but hey we should snap back to reality and know that we cannot afford everything we want. 🙂

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