Short-Term Challenges to Speed Debt Repayment

girl jumping with joyOne of the coaching clients I met with recently is going to be working his way out of debt for a number of years (unless something changes drastically).  Of course, as per the protocol, we talked about Dave Ramsey’s plan and about how he thought he would be psychologically motivated by the early win of paying off his lowest balance debt first.


The client stated that he has been successful in the past saving up money over short periods of time, like for trips or special purchases.  Because debt repayment and savings are two sides of the same coin, I started brainstorming with him short-term challenges that he could set for himself over a month or another period of time of his choosing.  The challenges would keep the necessary sacrifices of time and/or lifestyle fresh so you don’t feel deprived in any one area for too long.


1.  Fast from certain discretionary expenses.  For example: meals out, coffee from outside the house/office, random stuff from Target/Amazon/New Egg, hobbies, and a la carte movies/TV.


2.  Switch up your commute to spend less on gas.  You could carpool, ride a bike, take public transport, or work from home.


3.  Cancel your cable when your favorite shows are off (watch out for contracts and installation fees, though).


4.  Push yourself to earn double the side hustle money you did in the previous period.  You could take on more of your current type of work, raise your rates, or find a new side hustle.


There are two important points to not overlook when taking on these short-term challenges, though.  1) Devote all of the money you earn or don’t-spend straight to the debt.  2) Don’t over-indulge in the month following the challenge in that area – just return to your normal levels.


I think short-term challenges are more palatable to face than thinking from that get-go that you will be making that sacrifice for the entire time you’re working on the debt repayment.  You could probably get a lot more creative in what you’re willing to try for only a month.  And who knows – maybe you will even find that you are willing to make one of the challenges part of your normal lifestyle!


I didn’t intend to make this an exhaustive list so let me know in the comments what challenges you have or would set for yourself for accelerating savings or debt repayment!


What short-term challenges have you given yourself to pile up money fast?  How do you stay excited about working toward a goal for years?


photo from Free Digital Photos


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30 Responses to "Short-Term Challenges to Speed Debt Repayment"

  1. Cash Rebel says:

    Really looking through your mint account at all the new egg/ amazon purchases is such a life changing experience. It makes you keenly aware of how good amazon is at convincing you that you need stuff. One tip that’s worked well for me is cutting down on the grocery budget by focusing on ten foods. I have a list somewhere that has ten of the most caloricly/nutritionally dense as well as super cheap per pound foods in existence. So for a month I focused on buying apples and bananas instead of expensive fruit and oatmeal instead of fancy cereal. It’s a small change but every bit helps.
    Cash Rebel recently posted..Raises are the second most powerful force in the universe

    1. Emily says:

      For me New Egg and Amazon aren’t such the temptation but they really are for Kyle! But you are so right that once you get started shopping you can get sucked in, very similar to an in-person store.

      That’s a great tip about keeping those high nutrition/$ foods forefront with a set list. Kyle came home from grocery shopping last Saturday and said to me: “We need to LIVE off sweet potatoes – they are $0.29/lb!!” Which foods will be of highest value will change with the seasons.

  2. These are all great ideas! And even if you don’t have debt, you could try some of these challenges and put your savings for the month to investments. I might have to try these for myself to do just that! Thanks for the ideas 🙂
    Kali @ CommonSenseMillennial recently posted..Millennials Who Break Negative GenY Stereotypes

    1. Emily says:

      We have done various fasts in the past to increase our budget leftovers, but haven’t done the others on a short-term basis. We did cancel our cable permanently and switched to using only one car (carpooling to work and taking the bus/walking when necessary) for the time being (2 years-ish).

  3. dojo says:

    Cutting short the shopping ‘visits’ is a great way. Make a list and go buy stuff WHEN YOU NEED it. Stop spending even on little things (unless they’re important) and more money will be left each month.
    dojo recently posted..Save Money: Best ways to save money on energy (II)

    1. Emily says:

      Yes, it’s fine to do without for a few days until you have multiple items that you need to pick up at the store. I have sometimes fallen into the trap of buying groceries before I really need them and it led to increased spending.

  4. Mrs PoP says:

    I know some people get big kicks out of using apps like impulse save and stuff like that. For us, the big motivator was dropping the balances every month by a big hunk. For us, the nominal interest we could have saved doing it in smaller chunks throughout the month was outweighed by the feeling of accomplishment of seeing the balance drop in steps every month.
    Mrs PoP recently posted..He Said She Said: How Big A Cash Buffer?

    1. Emily says:

      Another way our psychology comes into play!

  5. I agree that breaking up a long term goal into smaller, short term periods of intense activity should yield better results. A series of sprints jives better with certain personality types.
    Done by Forty recently posted..Why I Cannot Watch Extreme Cheapskates

    1. Emily says:

      Back when I was rowing we used to do “power 10s” during races – ten strokes when we stepped it up even MORE than the baseline for that part of the race. I do think it gets more out of the participates when all is said and done.

  6. In the New Year, I *think* (haven’t fully decided) that I am going to go back to tutoring a few hours per week. It adds up so quickly for a few hours. And chem students ALWAYS need tutors! That money will then be funnelled onto my highest-interest debt.

    I have a few goals spread throughout the upcoming year that will help me make it.
    Alicia @ Financial Diffraction recently posted..Simplified Finances.

    1. Emily says:

      Tutoring can be VERY lucrative. Do you do that for HS, college, or grad students?

      I really struggle with mid-term goal setting. All I can see now is GRADUATE.

      1. Alicia says:

        I’ve tutored HS, and undergrad mostly. Occasionally I tutored other grad students in my field of expertise when they were coming up to comps.

        Good Luck getting to the finish line. Are you writing yet, or are you still in the lab? I am a great motivator for writing progress, if you need any – I am my good friends cheerleader at the moment 🙂
        Alicia recently posted..Simplified Finances.

        1. Emily says:

          Nope, not writing yet or really even thinking about it. I should start, though, so it’s not so much at the end like what Kyle is doing. I wrote a bunch of my prelim well ahead of time and that helped me be not nearly so stressed at the end.

  7. SarahN says:

    When I was saving for a house, I had a year (!) without buying clothes. I have also tried a month without eating out (I was sort of in a new relationship, and we’d got into some habits).

    I personally have stopped ‘side hustles’. I think I realised I valued the relaxation time more than the go go go-ness of student years where I worked multiple jobs.
    SarahN recently posted..Gingerbread House!

    1. Emily says:

      We did a month without eating out once as well, but normally we only do a couple times so it wasn’t a huge change. A year without buying clothes, though – that would be very challenging! Did you feel that it really sped your progress toward your down payment?

      I value relaxation time a lot, too. When I was working the year after I graduated from college, I had a part-time job and took a class each semester. I just didn’t understand how to not be over-busy. Now I just have my one job and my slightly monetized hobby. 🙂

  8. We are constantly saving for retirement, but sometimes we have shorter-term goals, like saving for a vacation, or for a car. My wife and I do get motivated to lower expenses when we have an agreed upon short-term savings goal.
    Bryce @ Save and Conquer recently posted..Some People Shouldn’t Take Vacations

    1. Emily says:

      We always seem to find the room to squeeze our budget when we agree on something we REALLY want!

  9. I think designating SOME of your “extra” or “found” income to discretionary expenses helps avoid a total splurge the following month. Glad you brought up that point. We all need A LITTLE indulgence.
    Stefanie @ The Broke and Beautiful Life recently posted..Don’t Blow It!

    1. Emily says:

      Hm, good suggestion. I think that really depends on how much discretionary spending you’ve kept in your debt-repaying normal budget and how much knocking the debt down is its own reward. If you are being very strict with yourself and hate paying down debt, I think reserving a portion for treating yourself is a great idea.

  10. Don’t just stop at cancelling cable… look at other monthly expenses. Cut magazine and newspaper subscriptions if they’re piling up, switch your phone plan if you’re off contract, invest in CFL bulbs in the most used light fixtures in the home, try to reduce your a/c and heater usage to cut down on utility costs (become a lover of sweaters in the winter and a shorts aficionado in the summer), etc.

    Also, meal planning can be hard, but start with cooking a simple, low cost meal that you can build up more recipes from. My husband was not the most confident in cooking but now I always request his lemon parsley fish (a Sandra Lee recipe) as he does it well and it’s delicious using a low cost frozen fish fillet.

    I learned to make amazing meatballs using almond meal and they were not only inexpensive but filling. 🙂
    Tara @ Streets Ahead Living recently posted..So sorry, I’ve been busy shopping

    1. Emily says:

      The meal planning suggestion is a great one to try out in the short-term. I stuck with it for a couple months before deciding that it was causing me to spend more on food so I gave it up, but I’m glad I tried it out.

  11. Great ideas, Emily. I love that you pointed out that even when you successfully complete one of these challenges, your work isn’t quite done! You have to make sure you got back to normal spending levels when you’re done (don’t splurge to “reward” yourself!) and to make sure your savings really goes towards you debt instead of using it on something else. Nice post!
    Laura @ recently posted..Lending Club Update December 2013

    1. Emily says:

      Thanks, Laura! I think it’s important to not set yourself up for failure by taking on a challenge that you know will just create pent-up demand.

  12. Sara says:

    I think having a reward at the end of a challenge is our main motivator – we’ll eat rice and beans for a month in exchange for going out to X fancy restaurant at the end of the month. (In the process we’ll save a bunch of money on food for the month, too.) We’ll go to a consignment store for most of our new clothes so we can buy (insert brand name) denim or gym shoes. Again, doing so generally ends in a net savings.

    Most recently – we’ll upgrade our couch when we pay off our car and a new bed when we pay off L’s student loan.

    But we also do it for smaller things too – we each have credit cards with reasonable balances on them. When they’re paid off, we each get $20 to spend however we want.

    1. Emily says:

      That’s a good approach, too, as long as you’re netting more savings with the method. Or I guess even if you’re not and you just choose to live sort of feast and famine that’s your prerogative!

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