How to abolish debt

The average UK household secured debt sits at £60,363 (as in January 2020) – secured debt, being that which is linked to something of high value. If you are in debt, it is very possible that it is causing some tension.

If you are feeling a little lost regarding how to tackle your debt, check out the methods below for various approaches to abolish debt. You can get started with two of the methods straight away, whereas one requires a good or excellent credit score.

Get started as soon as possible and begin the process of improving your credit score and freeing up some cash.

Preliminary work

Before tackling your debt using any of the following approaches, you will need to have created a budget forecast. A budget forecast is a detailed and comprehensive list of all income and expenses over a period of – usually a year. It serves to help you control your spend, save and build wealth. Use your budget forecast to financially plan for your repayments.

Having created a budget forecast, you are able to identify additional cash to use for tackling your debt. Be committed to tackling your debt by cutting down expenses and identifying additional income. Check out this article for extra cash ideas.

Snowball approach

This method is preferable if you do best with small wins along the way. As you focus on the smallest debt first, you build momentum quickly – it can even become quite exciting!


1.      Order your debts by their amount – smallest first

2.      Ensure you pay the minimum amount required on all but the smallest debt

3.      Overpay the smallest debt as much as possible

4.      As you pay off the smallest debt, move to the next and overpay that

Avalanche approach

This method is numerically the most cost-saving. You tackle the debt charging you the most interest first, by overpaying, therefore saving on interest charges. If you do not require the small wins of the snowball approach and are more concerned about paying less interest, this is for you.


1.      Order your debts by interest rate – largest first

2.      Pay the minimum amount on all except the debt with the highest interest rate

3.      Overpay the debt with the highest rate as much as possible

4.      As you pay off the most expensive debt, move on to the next and overpay that

0% balance transfer approach

This approach takes advantage of the 0% interest rate offered by many lenders. The 0% interest free period is offered for a set period – several months to several years. There is usually a small charge for the transfer, this is roughly 2% of the balance to be transferred. The key is to clear the debt within the 0% interest period awarded to truly take advantage of the interest saving.

This approach is dependent on your credit score and profile, as you will need to apply for a new credit card and transfer funds across.

Finally, you can apply for a balance transfer credit card to clear debts on other credit cards. But, you can also apply for credit cards to deposit cash into your bank to be used to clear non-credit card debt, such as a bank loan.

Additional preliminary work

You will need to check your credit profile to make sure it is in good shape (check out this article for details on how to do this). It is urged to carry out an eligibility check first, to ensure the application has a high chance of acceptance.

Identify the amount of credit you require from the new credit card, by totalling up all your debts. Be aware that you may not be offered the full amount you need, but do not panic. Simply use the new credit to clear down the highest interest charging debts – this is still a win!


1.      Use an eligibility checker to identify the 0% balance transfer credit cards available to you

2.      Apply for the one with a high acceptance rate (if they are all low, do not apply, and revert to the other methods mentioned above)

3.      Once accepted and processed, clear your debts with your new 0% credit card

4.      Continue making payments to the new card, clearing debt within the interest free period


Clearing your debt may take longer than a few months to do, but celebrate the win in taking action to reduce your debt and save money. Make the process easy for yourself by setting up standing orders to pay off your debts, so you do not have to think about it.

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