After a year like 2020, things have all been shaken up. If you had a situation like me, you were out of work and desperately trying not to wrack up credit card debt. Unfortunately, for a lot of people, that’s exactly what happened.

Having had a shopping addiction and many months living off of credit cards in my early 20s, I have had quite the journey of finally becoming debt-free and rebuilding my credit score.

If I remember correctly, I had a credit score around 520 not too long ago. No one would even consider me for a car loan or credit card. I was unable to finance a less than $2,000 car loan because my credit score was too low.

The irony of improving your credit score is that no one wants to help—or at least, they are incapable of helping due to all the red tape.

But thanks to hard work, determination, and time, I raised my credit score over 100 points in one year. A huge factor was the seven year period of credit hits from medical bills going to collection had expired. But I also paid off all my credit card debt in that same year, raising my credit score to almost 800.

Now, I don’t like attributing my worth to how much money I have or any arbitrary number, but in a world where you need to play the game, I felt much relief and triumph of having achieved such a feat in a relatively short amount of time. The experience of being rejected so many times took a toll on my self-worth and self-esteem and so I offer some advice below on how you can stay strong and resilient as you rebuild your credit score and pay off your debt.

It may take longer than you hoped to be debt-free, but if you’re constantly pouring your extra resources into a future where all your money is yours, you’ll feel better, and get there faster.

Below are five tips on how to pay off your debt and improve your credit score in the process, as well as how to keep your head up along the way.

5 Tips To Pay Off Debt and Improve Your Credit Score

1. Don’t make any unnecessary purchases.

This is probably the biggest adjustment someone has to make when they’re getting serious about becoming debt-free. We often become accustomed to a certain type of lifestyle that when it is being threatened, we are resistant.

For one year, I rarely allowed myself to go out to eat or buy myself anything unnecessary. Amazon kept trying to attract me back with a free month of Prime membership, which I used to my advantage—keeping it only for the month and buying only necessary things through it. If you buy a lot of things online, save them up until you get free shipping, because the shipping costs add up.

Make sure any time you make a purchase, it is from your income, not your credit card. This might mean waiting another month, but if you’re paying with a credit card, it means you don’t have the money and will just continue to dig your debt hole deeper.

Retrain yourself to realize that being debt-free creates more opportunities and is more valuable than buying whatever you want, whenever you want. This will help you start to shift your mindset and become more capable of paying your debt off faster.

2. Use all your extra money to pay down your credit cards.

So you might be wondering what I actually did to pay off my debt and improve my credit score. Well, I paid everything I had towards my credit card. Any time I received a paycheck, I paid off all my bills for the month and then I used the rest towards my credit cards.

For example, if your paycheck is $2,000 a month ($1,000 every two weeks) and your bills and groceries are $1,000 every month, more or less, you know you have a surplus of $1,000. If you don’t have any savings yet, you could put $500 towards your credit cards, or whatever amount feels like you’ll still be safe and save the rest—this does not go in the expendable budget, but is rather for emergencies.

Having a reserve of one month of income can help keep you covered for unexpected expenses. Try to build up this savings so you don’t stress and don’t end up using credit cards to cover emergency expenses. If you already have some money in your account, you could pay $800 or even the full $1,000 towards your credit cards.

By not allowing yourself to have excess money around to spend freely on unnecessary things, you force yourself to pay down your credit cards faster. Remember, credit cards are not your money, they are debt and paying off just the minimum amount every month (which I did for a decade) will never get you into a debt-free position.

Weigh your options: staying indebted the rest of your life or buying that new purse. Which one will feel better long term? And that’s the thing, we often make impulsive decisions on what feels good right now. However, that’s not in your best interest.

Getting debt-free needs a shift in mindset of what will feel best in the long run rather than immediate gratification. Find the balance between still having fun and living life with being responsible and making the best choices for your future self.

3. Capitalize on your cash back credit cards.

Chances are you have a cash back credit card in your arsenal. If you don’t, this is something to look into once you’re all debt free.

Having a cash back credit card means you get rewarded with cash back for every purchase you make. Use these types of cards on your largest purchases to make sure you’re getting the most bang for your buck.

If you normally pay for your monthly car payment with a debit card see if you can switch it to your cash back credit card so that you will earn money back for this large monthly expense. Remember not to allow this amount to stay as credit; immediately pay it off with the money you normally have allocated for this purchase.

I will use my credit cards to make any purchase, online or in-store, and then I will transfer that amount from my checking account to pay it off. This requires having money to make a purchase. If you can’t pay it off within the month, you shouldn’t be making the purchase.

You want to learn to save up your money and make the purchase when you can immediately pay off the credit card. This way you won’t incur any hits to your credit score or build up interest and will still be making money back that you can use as a statement credit for future purchases.

4. Track your budget.

There are several useful apps out there that you can link to your credit cards and bank account to track where your money is going. For years I used Mint, Intuit’s budget tracking app.

You can set up your budget and how much you are trying to spend every month in different categories. This will help keep you accountable and aware of where your money is going every month, showing you where you may need to adjust and recalibrate.

While I was rebuilding my credit and paying off my debt, I religiously looked at all my accounts, trying to figure out where the majority of my money was going. A lot of times we don’t realize how much money we’re spending because we don’t actually see it.

By keeping track of your money and watching your spending habits you can learn healthy money management skills that will pay dividends in the future.

5. Only use cash.

This is a big one. If you have a problem with overspending, you can easily circumvent that with this helpful trick. Withdraw the amount of cash you are allowed to spend either weekly or monthly and keep that in your wallet.

Don’t carry around all your credit cards. Easy access to these makes it so much easier to use. By using cash, you’re actually seeing how much you’re spending and will see when your funds are diminishing, which might inspire you to not buy the large coffee, but rather make your own coffee at home.

By using cash, you can also plan ahead. If you really want to enjoy a nice meal at your favorite restaurant with your friends on the weekend, you’ll have to budget your cash and save for the outing. This will teach you responsibility and prevent you from overspending and overindulging.

Due to the increasing digitalization of money, we don’t actually see how much we’re spending. It’s easy to not understand the cost of making small purchases here and there because we don’t actually see it add up.

Having a set amount of cash will show you how much money you’re actually spending and how all those small purchases do add up, preventing you from finally becoming debt-free and improving your credit score.

By keeping track of your finances through apps and having cash as a visual cue, you will start to develop a better understanding of your spending habits and where you need to become more responsible with your money.

Don’t forget…

There’s something important to note. And that’s to still remember to live.

Every now and then you can treat yourself to something reasonable. The fact is, if you’re in debt you are not fully living anyways, there’s always this weight bearing down on you. But that doesn’t mean that in the process of paying off debt and rebuilding your credit you have to suffer and be miserable.

Believe me, I’ve cried my eyes out many times feeling completely pathetic at not feeling creditworthy. It felt like the world was against me and I would never be able to get my head above water.

The truth is, I needed to experience all of that to value what I have now. The amount of effort I put out and the sacrifices I made make my credit score and money so much more valuable to me today. I believe there was a great deal of maturity that came with the level of responsibility and accountability I had to take on.

Remember that you have a purpose behind your sacrifice. For me, I told myself once I paid off my credit cards I was going to then put all my additional money into a vacation. But first I had to pay off all my credit cards and make sure the flight was booked from money I had, not from credit.

This level of motivation inspired me to work harder and endure a year of minimalism, always keeping inside my heart the desire of being debt-free and taking a vacation without the weight of finances burdening me.

Remember that it’s a journey. You might be surprised how rewarding it feels to save your cash for a night out and you just may realize that you don’t need a special latte every day to treat yourself.

Treat yourself to a better future by getting on track to rebuild your credit score and pay off your debt. Your future self will thank you.

How to Pay Off Debt and Improve Your Credit Score