DIY Debt Management Plan: Get Out of Debt in 2022

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In this post, you’ll discover how to create a DIY debt management plan to finally start getting out of debt in 2022.

I’m using these 8 simple steps to cut my debt and live financially free. I’m so excited to start living life without the weight of debt on my back. Here’s how I’m planning to do it.

First, let’s look at what you’ll learn in this blog post:

  • How to select a debt pay-off method
  • How to decide how much debt you can pay this year
  • How to make more money so you can pay off your debt faster
  • Expense cutting with savvy budgeting
  • Extra tasks you can complete to help your DIY debt management plan

DIY Debt Management Plan: 8 Steps To Follow

Emergency Fund

The first step is to ensure you have some type of emergency fund. This could be anything from £100 to a couple of hundred pounds.

Think of this as your back-up fund for anything that crops up out of the blue. For example, I currently have £250 placed in a separate bank account. Keeping it away from your main bank account means you won’t be tempted to spend it.

Get Your Family On Board

It’s essential to have all family members on board with paying off debt. You’ll be able to keep each other motivated and everyone will be able to stay within budget when it comes to spending. 

Write All Your Debts Down

Here is one of the most important steps. This is often an eye-opener.

Let’s face it, how often have you kept on paying minimum payments without ever really looking at your total debt?

List every debt total with the minimum payment due each month and the current interest rate. Your debts will likely include credit cards, student loans, personal loans, any other credit purchases.

Choose Your Debt Pay-Off Method

There are two methods to pay off debt.

  • The snowball method is where you pay off the smallest debts first. This helps to keep you motivated. 
  • The avalanche method is where you pay off the debt with the highest interest rate first. This aims to save you money on interest. 


Let’s say we have 2 credit card debts. 

The first is £2000 at an interest rate of 20% per year

The second is £1000 at an interest rate of 18.9 APR

With the snowball method, we’d start tackling debt number 2 first. However, with the avalanche method, we’d start paying off debt 1 first as it’s a higher interest rate. 

How to choose which debt method to use

This depends on how motivated you are to work towards your goals. As my motivation tends to start lacking after a while, I prefer the snowball method. This works best as I feel more satisfaction when I reach my goals faster. 

If you can pay off a large chunk each month, I’d recommend the avalanche method as you’ll save yourself some serious cash in the long run. 

How Much Debt Can You Pay in 2022?

Be realistic about the debt you can pay off in 2022 with your DIY debt management plan. You may not be able to pay all your debt off this year which is perfectly OK.

It’s better to make some progress than no progress at all. 

If you haven’t created a monthly budget, now is the time to do so. I personally love the Monese app as I can calculate all my incomings and outgoings.

Alternatively, you can use a physical budget planner to write out all of your expenses and income. Once you’ve created a budget, remember to review it regularly. 

How to Make More Money

Thankfully, there is an abundance of ways to make extra money online, including starting a side hustle.

Here are a few things to consider:

  • Start a blog
  • Open an ETSY shop selling printables
  • Use money-making apps
  • Sell your services on Fiverr
  • Become a virtual assistant
  • Begin freelance writing
  • Flip items for profit on Facebook marketplace
  • Do Amazon FBA
  • Create and publish your own books on KDP
  • Fill out surveys online to earn gift cards

How to Cut Your Expenses

  1. Reduce your phone bill

The average US phone bill is over $120 per month. That’s a lot of cash to spend.

A good way to save money each month is to use a cheaper network. Once you’re out of contract on your phone, consider using Smarty. I pay £7 per month which covers all my calls and texts plus a couple of GBs of data. It’s more than enough for what I need.

There’s no contract with Smarty so you’re free to leave at any time. Plus, there’s excellent network coverage too. 

2. Use cashback apps

If you need to spend money, use a cashback app like topcashback to get money back on your purchases. I’ve earned almost £1000 just for making regular purchases. 

3. Use comparison sites for energy and car insurance

You can save hundreds of pounds by checking comparison sites to get your energy and insurance much cheaper. You can also check for home and pet insurance, as well as broadband. Always try more than one comparison site too. There’s compare the market, go compare, and money supermarket. 

4. Meal plan.

Meal planning in advance can help you to save money on your grocery bills as you know the exact ingredients to buy. Aldi and Lidl tend to be the cheapest supermarkets but Farmfoods and Iceland also have some great deals. 

Extra Things To Do

  • Negotiate interest rates. This could save you several hundred pounds depending on how much debt you have. 
  • Ask for a raise at work. If you’re due a raise, now is the perfect time to ask. 
  • Check your credit report to see if you have any offers. Transferring your debt to an interest-free card can save you money and give you longer to pay off your debt. 
  • Freeze your cards so that you’re not adding to your debt. This will help you to pay it off quicker. 
  • Consolidate your debt. If you have several debts, consider consolidation so that you’re making one payment per month rather than several. 
  • Track your progress – celebrate the small wins so you can see how far you’ve come in a short space of time. 
  • Get support – join a Facebook group to get support from others in a similar position.

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