When you barely earn enough to cover minimum payments on your balances, climbing out of debt is difficult – but not impossible. Here are some suggestions on how to pull it off.

Don’t Create More Debt

Borrowing funds from a lender to pay another creditor is hardly ever a good strategy since all you’re doing is moving debt around instead of erasing it. Resist opening new credit cards or other lines of credit and get your spending in check.

Calculate How Much You Owe

Before determining how to get out of debt on minimum wage, you need to figure out exactly what you owe. This may be the last thing you want to do, but it’s an essential step, both practically and psychologically.

Gather all your bills and add up your obligations. Next to the principal balance, jot down the interest rate, late fees, and potential penalties you may have to cover.

Establish a Budget

This is likely another task you’ve been avoiding, but it must be done if you have hopes of ever paying more than the interest on your debt settlement tips. First, list all your income sources and your recurring, fixed expenses such as your mortgage or car payment.

Then, subtract the difference between your overall income and those fixed expenditures. What’s left is money for variable expenses like clothing and groceries – and your debt. Calculate how much cash to earmark monthly for variable expenses you can’t eliminate – groceries, for example, then set aside the remaining money for paying off your debt. Whenever you can, increase your debt payment.

Knock Out the Smallest Debts

It can be a smart and spirit-boosting strategy to pay off your smallest bills first. Watching those balances disappear will motivate you to keep going until you are debt free. By contrast, starting with the biggest debts can be dispiriting since paying those off will take longer.

Now Tackle the Larger Debts

After you’ve wiped out the smaller debts, it’s time to wrangle with the larger ones. While there are several methods for doing so, the avalanche strategy is particularly effective. This entails making minimum payments on each debt, then using the rest of your available cash to clear your balances with the highest interest rate. In doing so, you’ll keep more of your earnings each month, which consequently enhances your ability to make larger payments.

Seek Ways to Earn More Cash

If you’re still not making enough headway into paying off your debt, you might need to find ways to bring in more cash. Perhaps you can get yourself a side “gig” – dog sitting, ride sharing, or graphic design, for example. If you have a hobby, perhaps there’s a way to monetize it. Get creative and brainstorm or ask your friends to help you figure something out.

Explore Other Solutions

If the interest on your debt continues to grow unabated, and your budget is off the rails, you likely need professional help.

Debt consolidation is one option. This is basically a personal loan that you can use to pay off your outstanding debt by combining your obligations into a single fixed monthly payment of the same amount. This financial strategy makes the most sense if you can get an interest rate that’s less than what you’re paying on current debts.

Debt settlement is another option. This entails you hiring a company to negotiate with creditors on your behalf to get them to accept less than what you owe. You will likely be advised to cease paying your creditors as a way of motivating them to accept some payment rather than nothing. This will hurt your credit score, at least in the near term. However, debt settlement does provide a way to get you back on track.

Now you know how to get out of debt on minimum wage. It won’t be easy, but it IS doable. Get started on it today.