Living A Debt-free Life: 10 Hard But Effective Ways

I understand the need to borrow money for expenses, but there’s nothing as good as living a debt-free life as a youth. 

You won’t be under intense pressure to refund the money. 

Let me share a short story of a Nigerian lady who committed suicide after failing to repay her loan. 

Sarah was a struggling single mother living in a small village in Kwara state, Nigeria. 

She wanted to provide a better life for her four-year-old son but could barely make ends meet.

All her efforts to acquire financial support from friends and relatives were to no avail. 

So, Sarah decided to take out a small loan from a micro-bank to start a convenience store in her village, hoping this business would lift her out of poverty.

Unfortunately, Sarah couldn’t sustain her venture due to a lack of experience. 

She failed to repay her debt at the agreed time, and the constant harassment from collectors overwhelmed her. 

Feeling hopeless and ashamed, Sarah took her own life, leaving her son orphaned.

Sarah’s unfortunate incident illustrates the tragic consequences high-interest debt can have when people take on loans. 

So, let’s discuss how you can stay out of debt without compromising happiness and healthy life. 

How to Stay Debt-free 

Below are the effective steps to settle your debts and live a debt-free life:

1. List All Debts 

This is the first way to get out of debt since you can’t repay the debt you don’t remember.

A Debt payment tracker that can living a Debt-free life
A Comprehensive Debt payment tracker 

Write all your debts in a journal. The list should cover the amount, lender, repayment date, and how you intend to repay. 

All these details will help you determine whether to increase your income by doing other side hustles. 

 2. Stop Investing for Now 

If you have been following this blog for a while, you will notice I don’t joke with investment. 

I often advise people to invest in profitable businesses or ventures. 

However, this time, it’s better not to invest until you pay off your debts. 

Start an early repayment schedule so you won’t feel overwhelmed. 

Here is the thing:

  • Earn your monthly salary
  • Put 10% into your emergency fund account. 
  • 10% should be for tithe. This is very important, especially for Christians. 
  • 50% for your upkeep
  • 30% should cover the debts. That way, you will settle everything without the lender’s embarrassment. 

Meanwhile, you can invest in any business after debt repayment.

3. Develop a Debt-free Mindset 

Mindset is everything in life — you can’t achieve what you don’t process in your mind. 

Your chances of living a debt-free life largely depend on your mindset and belief system. 

The right mindset will help you develop the attitude and determination you need to succeed in your quest for a life free of debt. 

A young man cutting the chain that tie him to debt.

Make up your mind never to borrow money from anyone or anywhere, regardless of your situation. 

What about emergencies? Well, that’s why you must observe the next point.

4. Save for Emergency Purposes 

Here is another effective way to stay out of debt or avoid borrowing money for emergencies. 

An emergency savings account contains the money you save for unexpected situations. Sarah didn’t have this luxury. 

With this money, you won’t have reasons to borrow from anyone in urgent matters.  

You can easily withdraw the amount you need without stress. 

Luckily, many financial institutions and fintech companies support emergency savings accounts. 

They help users save for emergencies and grant them access to money at any time or day. 

PiggyVest is one of the tested and trusted companies.

Screenshot of how Piggyvest savings helps me live a debt-free life

Apart from saving for emergencies, the platform also permits users to create or join a saving challenge. 

Its untouchable saving features mean you can save a certain amount for a period without touching it. 

Meanwhile, you will enjoy impressive interest rates on every amount you save.

There are other features to explore on PiggyVest. 

Hence, kindly download the app and sign-up via this link and start saving for emergencies.

5. Exchange Materials for Cash 

Why not exchange materials for cash instead of borrowing money?

It sounds funny, but that’s another way to live a life free of debt. 

You have countless clothes in your wardrobe, many classic shoes in your collections, and pieces of diamond jewelry. 

Unfortunately, your wallet is empty. 

It’s only wise to use what you have in exchange for what you want. 

Find someone who needs those materials and exchange them for money. 

Understandably, they would be cheaper than the initial price, but that is better than borrowing money that will incur interest.

6. Create a Budget and Use It 

Having a budget is another effective option to start living a debt-free life. 

It helps you manage your income by preventing unnecessary shopping. 

Consider your income and create a conducive budget. 

Go for the most pressing items, settle all the bills, save for emergencies, and invest in profitable businesses.

A budget that supports a debt-free life 
A budget that supports a debt-free lifestyle

Meanwhile, there is an apparent difference between creating a budget and using it. 

Most people create a monthly budget but ignore it after some weeks. 

A budget is ineffective if you fail to explore its benefits. Don’t just write, use it. Let it guide your spending lifestyle

7. Start a Side Hustle or Part-time Work for Extra Income 

Do you want to stay out of debt? Start a side hustle.

I won’t dwell on this for long because many bloggers and motivational speakers always say it. 

Freelance writing, graphic designing, online surveys, selling digital products, and affiliate marketing are famous high-paying side hustles for everybody. 

Meanwhile, below is a list of factors to consider while looking for the right side hustle:

  • Startup costs
  • Earning potential
  • Time commitment
  • Interests
  • Skillset

8. Shop with Coupons and Promo Codes 

Shopping with coupons will reduce your expenses as you will get many items at a discounted price. 

I talked about how and where to get coupons and promo codes for different items in my previous post. You should check and implement it here. 

With coupons, you won’t need to borrow money to get expensive items and goods. 

9. Uninstall Loan Apps and Credit Cards 

You might have to dump your credit cards to prevent debt since it’s easy to use them for loans. 

As for loan apps, they are a no-go area because they are easier than the conventional ways. 

Delete them from your devices to avoid unnecessary temptation. 

10. Have Attainable Financial Goals 

Financial plans can help you stay away from debt if they are effective.

Set financial goals and deploy ways to achieve them. 

It involves finding the right ways to spend your income without affecting your livelihood and future. 

Financial plans involve deciding the percentage to spend, invest, or save based on your monthly income. 

An effective financial plan will let you know when to increase your earnings or change your lifestyle so you won’t borrow at any time. 


How do People Become Debt-free?

  • Making debt repayment a priority
  • Sticking to a budget
  • Increasing income
  • Using windfalls wisely
  • Living below means
  • Following debt payoff strategies like snowball or avalanche

What to do if You Are Debt-free?

  • Build an emergency fund
  • Maximize retirement contributions
  • Invest in other goals
  • Give back to causes
  • Splurge a little on something special
  • Save and invest the money that used to go towards debt

At What Age Should You be Debt-free?

  • There is no one ideal age, but many experts recommend:
  • Trying to pay off consumer debt by 30
  • Being debt-free by 40 is a worthy goal. 

How to Start Living a Debt-Free Life?

  • Make a detailed list of all debts owed. 
  • Come up with a payoff plan. 
  • Limit unnecessary spending
  • Increase income
  • Funnel all extra money toward debt. 
  • Stay motivated by tracking payoff progress. 

What Are The Benefits of Living a Debt-Free Life?

  • Peace of mind
  • Less stress
  • Ability to save and invest more
  • Freedom in career and lifestyle choices
  • Higher net worth
  • Improved relationships
  • Modeling good financial habits for children
  • Leaving an inheritance
  • More clarity about finances

Final Thought

The story of Sarah shows what can happen when high-interest debt becomes unmanageable. 

Learn from her situation and take control of your finances.  

With discipline and the right strategy, you can avoid dangerous debt and gain real financial freedom.

Meanwhile, I advise you read the 10 Mistakes I Made In My Early 20s (especially the financial aspect) and how you can avoid them

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