How Examining Your Mindset Around Debt Can Help You Pay It Off

Money Files

Have you ever taken the time to think about your relationship with debt? Many of my clients come to me with student loan debt, personal loans, or credit card debt.  

Their thoughts are consumed with trying to figure out how to manage paying off their debt while also working towards other goals like buying a home, building an emergency fund, or having extra money to do things they enjoy like traveling or enjoying a spa day. 

In today’s episode I help you reframe your relationship with debt so you can then decide how you want to approach paying down debt in your own life.  

This episode will help you discover the root cause of your debt, engage you in a flexible plan to help you pay down your debt, and identify ways to ease the financial burden so you can pay off your debt sooner. 

In this episode, you’ll learn…

  • [01:14] The debt brain-dump and how it can help you sort out your feelings around your debt
  • [04:43] How the financial awareness you gain from a debt brain dump allows you to make adjustments in the way you handle your money
  • [07:30] Why examining your motivations will help you choose a debt payoff strategy that works best for your unique situation
  • [12:03] Why you shouldn’t turn to balance transfers until you understand why you’re in debt
  • [16:49] How you can change debt payoff from feeling restrictive to expansive by looking for ways to make extra money and finding extra money in your budget
  • [24:52] Why changing your mindset and paying off your debt can open up opportunities you never thought possible 

Tune in to this episode of Money Files to change your mindset around debt and pay it off for good. 

Are you ready to reframe how you think about debt and open up your life to new financial opportunities? Apply to work with me, and let’s start working towards your financial goals.

Did you find some helpful insight in this episode! Check out this one next!


[00:00:02] Hi and welcome to Money Files. I’m Keina Newell from Wealth Over Now. I work every day with professional women and solopreneur is to help them get out of financial overwhelm and shame so they can experience more flexibility and ease with their finances. Are you ready to gain confidence and learn to manage your finances intentionally? Tune in and grab financial tips that will help you master the way you think about and manage your finances. 

[00:00:32] Hello and welcome back to another episode of Money Files. Last week I talked about saving money. And this week, I want to talk to you about paying down debt. And I specifically am going to talk about debt payoff strategies. But before we get into debt payoff strategies, I actually want you to do what I’m calling a debt brain dump. I don’t like to talk about money unless I’m also talking about emotions at the same time, because money is very emotional. And I think it’s important for us to shift the conversation around saving money, buying things that we enjoy. Paying off debt. Like I want you to have thoughts about whatever your current situation is. 

[00:01:14] So if you’re listening, the first thing I want you to do is think about what type of debt do you have? Maybe you have student loan debt or credit card debt. Maybe you have a mortgage. Maybe you have a personal loan. Maybe you have a family loan. So you borrowed money from a family member. So first, just name what type of debt you have. Then I want you to think about what are your current thoughts about the debt that you have? 

[00:01:46] So often I find that we think that debt is bad. That’s our most common go to. That’s the narrative that we hear from all the financial gurus is that debt is bad. And I’m not here to really disagree or agree, but I want to give you an opportunity to answer this question for yourself in a different way. I want you to think about like what opportunities has your debt afforded you? So one example from my own personal life is I had over $70,000 with a student loan debt. If you follow me on social media, and I probably said it somewhere on the podcast as well. But I saw that debt as investments into relationships that have given me more than $70,000 worth of value. And so for me to think about my student loan debt in that way, it may be paying it off so much easier. So it wasn’t like good debt or bad debt for me. I just saw it as an investment into relationships with a group of friends that I have now that are an incredible support system in my life. And so every time I see one of my friends doing something amazing, I’m like, See, I’m getting a return on investment for over $70,000 into that relationship. And so. Which has helped me compartmentalize my thoughts about that student loan debt, because there was definitely a time in which that balance felt very crippling and like, how am I supposed to pay this debt off and buy a home and do whatever else it is that I wanted? 

[00:03:23] If you’re looking at credit card debt, think about what opportunities has that debt afforded you. Maybe you had to put some medical bills on your debt, and that’s okay. Maybe it provided you relief because you had to put a root canal on your credit card. And so think about just maybe lessons that you’ve learned or things that you’ve been able to gain because of the debt and just really being able to reframe whether that’s good or bad because we want to be creating a new story moving forward. So that’s why I’m asking you to ask yourself that question. Then if you had to hypothesize for yourself. Why are you in debt? I think this can be really important question for you to answer, because sometimes I know in times in my life I was in debt because I was traveling with friends, putting a flat tire on my credit card, but I was truly living above my means. And so I knew that. Right. I don’t think I could tell you that. Oh, my goodness. There was this, like, really solid reason for some of my credit card debt besides the fact that I was living above my means. But I want you to really be able to reconcile with yourself. 

[00:04:43] If I had to hypothesize, like, why am I in debt? And the reason that I want you to ask that question is because it’s going to help identify, like, a root issue that you might have. It’s going to help identify spending habits. It’s going to help you identify your spending patterns. And so you can actually identify and adjust these behaviors. And when I’m working with clients, I also tell them, like, if we identify what you’re putting on your credit card. And I think credit cards, the tricky part about them is that the balances are kind of out of sight and out of mind until the bill comes due. But if you realize what you’re putting on your credit card, those are things you can start to plan for. So when I ask you to hypothesize why you’re in debt, this isn’t because I want you to judge yourself, but it’s because I want you to build this financial awareness. And financial awareness illuminates things, and when you have illumination, you can go in and fix the thing that you want to adjust. 

[00:05:40] And then lastly, when you think about this hypothesis that you have about why you’re in debt, are these circumstances, are they still present in your life and causing you to continue to add to your credit card debt? Or continue to add to your debt. So you’ll hear me probably lean more towards credit card debt in this episode, but this really could be about any debt. If there’s a present circumstance that is in your life and you realize like this is the thing causing me to continue to be in debt, then we know that this is the thing we want to solve for. We know that maybe you’re still paying on a trip that you’re going to be taking in a couple of months. I would say if you haven’t paid the balance off on that trip, that circumstance is still present in your life. And it’s present because if you were to pay off that credit card with a lump sum of money and then you woke up the next month and you’re like, Oh, I got hit for another $500 because I have a $500 deposit every single month. That’s something that’s really important for you to know. 

[00:06:47] So take some time, do that debt brain dump and just sit with what debt you have, how that’s making you feel. Thinking about the opportunities that you’ve been afforded from being in debt and that framework that I just helped you create with those five questions really goes into helping you create like this debt payoff plan where I want this to be the last time that you have to consider paying off debt. But I also don’t want you to have all these negative feelings while you’re paying off debt and to be hard on yourself and to not be extending yourself. Grace as you’re paying off debt. 

[00:07:30] So the next thing I want you to consider as you’re thinking about paying off debt. Like I said, there’s different debt strategies. And so. If you listen to any of the financial advice that you can see on the Internet, there might be advice about a debt snowball or you might have heard something called a debt avalanche. And so a debt snowball is when you actually have all your balances for your debt and you’re going to pay off the balances from smallest to largest, and you’re going to pay the minimum on all your debts, but you’re going to apply extra money to your smallest debt until it’s completely paid off, and then you’ll pay off the next smallest debt. So you just keep going until all of your things are paid off. The debt avalanche is when you list out your debts and you list them out based off of the interest rate. And so you’ll pay the minimum on all of your debts, but you’ll apply extra money to the debt with the highest interest rate until it’s paid off. And then you’ll go to the next interest rate. That’s the highest, and you’ll just continue until all of the debt is paid off. And so those are two very common approaches for paying off debt. You’re probably thinking, well Keina, which one should I use? I think that totally also depends on you. So are you motivated by paying off small balances because you’re going to be able to say like, Oh, I like accomplish something? If you have a credit card that’s 1500 dollars and you have a credit card that’s $28,000, it might feel really good for you to pay off that 1500 dollars credit card because it’s like one less bill that you have to pay. So that might feel really motivating to you. 

[00:09:13] Or you might be someone who’s really motivated by this idea that you get to save money on interest. So maybe you have three credit cards that are all about the same amount, and there’s one that’s 3000. There’s one that’s 4000, there’s one that’s 2000. But one of them has a 25% interest rate, another one has a 10% interest rate and another one has a 12% interest rate. So if you were motivated by the idea of saving interest, you would start paying off that debt that has the highest interest rate. So. I think it really depends on your situation and your motivation that I want you to be motivated throughout your debt payoff practice. I want you to be motivated by seeing the balances go down. When I was paying off my credit card debt and when I was paying off student loan debt, I switch back and forth in between snowball and avalanche. So sometimes I was like, You know what? This little balance is 1200 dollars. I want to pay that off because it’s going to make me feel really good. And then I might go back to paying off a higher interest debt because I wanted to save money on the interest. Okay, so you can and it’s like I said, totally up to you if you want to use that snowball or if you want to use the debt avalanche approach. So if you whatever you’re thinking about doing, it’s also important for you to put all of your debt in one place. 

[00:10:43] Maybe you put it in a spreadsheet right on a piece of paper, but write down what’s the type of debt with the current balance, what’s my current minimum and what’s my interest rate? If you are someone who may be behind on your payments, I would also write whether or not I’m ahead on my payments, and I think it’s really important to write the current minimum payment. So your current minimum payment may not be the payment that you’re making. I find clients a lot that like their minimum payment might be 120, but they’re like, Oh, I pay 150 or pay 180. And so when we’re working together, I ask them to just tell me the minimum because I want to know how much overall they may be overpaying on a certain debt because generally speaking together will create a debt payoff plan where we’re looking at, okay, you’re adding $20 to all of these little debts, but let’s take these five. That said, you have and let’s take this $100 and add it to all towards one debt so we can get that one paid off. So we kind of build a timeline for how we’re going about paying off debt. And so that seems to help with their motivation. It helps them have a really clear plan. It helps them have a picture of when something is going to be paid off, and then they know exactly what they’re going to go and pay off next. So debt payoff strategies snowball, an avalanche. 

[00:12:03] If you’re listening to me and you’re like Keina, but what about those balance transfers? I just got something in the mail and it told me I could transfer my balance. I caution people from using balance transfers if they don’t actually know the root cause of their debt. So earlier, when I ask you, like if you had to make a hypothesis about why you’re in debt and are those circumstances still present in your life? I don’t think a balance transfer is a good idea for you because if you haven’t actually identified why you’re in debt, what happens is you do the balance transfer, so you transfer the $12,000 to the 0% interest card. But then the credit card that you now freed up, you start using that one again. And now you have $12,000 on a 0% interest card. But then you look up and all of a sudden you have $3,000 on this card that you were supposed to be paying off. And the only reason that’s true is because you don’t know the root cause of why you’re in credit card debt. The only reason that’s true is because you don’t have a spending plan that helps you actually account for the things that you’re putting on your credit card. So all in all, you have no financial plan. So you’re not actually you’re not helping your situation. You’re just moving around the problem. 

[00:13:23] And so with a few of my clients, we have used a balance transfer. But we’ve done that like 3 to 4 months into working together after I’ve learned more about their spending habits, after they have a solid handle on their spending habits. And we feel like that’s a good strategy. But we also don’t use that strategy alone in isolation without knowing the numbers, because if they’re transferring $12,000 and they want to pay it off in a year, it’s like, what does that look like? What if you can only pay off $10,000 in the year and not $12,000? Like, what’s the plan for the other $2,000? 

[00:13:58] So we’re always coming up with a plan, but then we’re poking holes in the plan as well, because it’s very important for my clients to have their own backs and know how to actually walk through different situations and know, well, if this happens, then I’m going to do this. And if this happens and I’m going to do this. 

[00:14:17] I actually got a message from a former client and I’m so proud star student status, but I got a message from a former client. And when I’m talking about helping my clients think about how they’re managing their finances. Like that’s the thing that I want to download for them that when they’re not working with me, that they have a solid way of thinking and they’re not thinking like their old selves and that they are able to navigate different financial situations. So she sent me a message and she told me that she needed to buy a water softener for her house and she’s like, I know you’re not a fan of a firm and like these afterpay’s, but I had a discussion with myself on what would be my next best move. I didn’t have money in my home repair fund to pay it all up front. I had the money in my emergency fund, but then I asked myself, Is this an actual emergency? But on the water softener website, one of the payment options was a firm and I could do interest or no interest for three months. And she said within the three months I would have enough in my home repair fund to cover the expense. Therefore I didn’t need to take it out of my emergency fund. Right now I know that I could always pay myself back to my emergency fund, but going through a firm made the most sense personally. Anyway, this is to say that I appreciated this discussion and the options that I had in making this decision. All the little things I learned during my coaching cycle with you. 

[00:15:42] So it’s not, like I said, not a one size fits all approach in working with me, but in thinking about these different things that snowball, that avalanche, looking at a 0% balance transfer. It’s really about asking yourself the questions and knowing why and being able to propose these plans for yourself so that at the end of the day, you actually are going to achieve the result that you want. And the result you want is to be able to pay down your debt. The result you want is to pay off your debt ultimately, and then be able to free that money so you can put it somewhere else in your life. So those are the debt payoff strategies that snowball the avalanche. And then I commented on how how I feel about 0% balance transfers. Once again, it’s not a don’t ever use it, but I caution people in using it because I see it done and then I see people with two or three balance transfers that have now gone back up to 25% interest and they have another credit card with a smaller balance. And so we have to get in there and identify like, why are you actually why do you continue to go into debt? 

[00:16:49] The other conversation when it comes to paying down debt is that I think that when we start thinking about paying down debt and I had this conversation with another client just a couple of weeks ago, she said, Keina, every time I come into a coaching call with you, I just feel I feel like you’re going to tell me to constrict. But without fail, you tell me to expand. And in this particular conversation where you are building her debt payoff plan, and I ask her like, is there a way for you to make extra money? So she has a skill that she can monetize and she’s monetized it before. But we were talking and looking at her budget and thinking about like when she wants to pay off her debt. And I just pose the question like, what would it look like if you were to bring in an extra thousand dollars a month? Like, is that feasible? How do you feel about it? What comes up for you when you think about having your full time job and maybe doing some contract work that brings in at least $1,000 a month for you? 

[00:17:50] So when we’re thinking about paying off debt, we can decrease our expenses or we can go in and increase our income. And so when you have this solid like financial plan, you know, like what’s the number that I need to be able to pay off my debt by this state or what’s the number I need in order to make additional $300 payment? And so you can think about that as I want to increase my income. So there’s a couple of different ways I think you can increase your income. You could. Negotiate your current salary, but you can continue to live off of your old base salary. So if you’re making $80,000 and you negotiate to $95,000, when you start to get your new paychecks, you could just live off of your old salary and apply the extra income toward your debt. So that could be an option. 

[00:18:44] You could do, like my client and I are exploring right now, and you could monetize a skill that you already have. So maybe you’re already doing things for free, like you are consulting or giving advice to your friends. Start charging them $100. Whatever you can get our month. My time. I have a friend that people call her and they want to pick her brain and I tell her, like, you should monetize that. Just tell them it’s $100 to spend an hour with you, whatever that looks like. Right? But those little things that you’re doing, you can be applying that money towards your debt. Or you could take on some part time work. Like, if you love kids, you can babysit. I was a teacher, so the thing that I did to earn extra income at the time is like I would tutor is very easy for me to tutor in math. I enjoyed it. If you’re someone who wants to wait tables, you could do that. You could do dog walking, dog sitting, but just thinking about ways in which you can earn extra money and being really intentional once you actually have this debt payoff plan that you could make sure that you’re funneling an extra three, five, $600 a month towards your debt. 

[00:19:56] Okay. So that’s one way to think about also paying off your debt. And then the other way that I think is very traditional is to decrease your expenses. And I want you to hear me loudly. I am not saying that you need to start eating a piece of bread with a tablespoon of peanut butter. That is not what I’m saying. That is not how I desire to pay off debt. And there’s no joy in that. Right. But thinking about when you think about decreasing your expenses. First off, I’m talking to you as though you have establish a baseline budget. If you have it, do that first because that’s going to help you put everything into place, understand what it is that you have coming in and what you have going out. And so if you have this baseline budget, what you can go in and do is you can audit your current expenses. So you can think about what expenses do I want to keep? What expenses do I want to cancel? So if you’re someone who has Hulu, Disney, Paramount, Netflix and every other streaming service under the sun, but you realize, Oh, wow, I’m spending $80 a month on streaming services, but I’m really only watching one. If you canceled everything besides maybe the one that you’re watching, that could be an extra maybe 60 bucks that you save a month, right? 

[00:21:19] That $60 could go towards that $100 minimum payment that you’re focused on paying down. So now you have another $60 that’s going towards that. And so just think about where you there’s expenses that you want to cancel and that money not immediately going to your grocery budget, not immediately going towards some other thing, but like can that money go towards you paying off debt? You can also look at your. Another thing that I tell people to do is to revisit their expenses. So if you go through and you decide which one do you want to keep? Decide what you want to cancel, go through and think about what expenses do you want to revisit? Maybe you had like a Peloton membership and it’s an aspirational goal that you’re going to use it. But give yourself a time limit, maybe 30 days or 60 days and you realize I’m not actually using that, so I’m going to cancel it. Right. So it’s kind of like goes on your watch list or maybe you have a gym membership that’s also aspirational. Put that on your watch list and see if you use it. But just thinking about like, are there expenses that I want to revisit because maybe I’m not using them as much as I want to, or maybe I don’t actually desire to have this annual membership to Instacart anymore. Or I don’t want the monthly massage membership because I’m not using it as much as I thought I would or I don’t enjoy it. 

[00:22:42] And these little decisions that are within your control and we’re not talking about being restrictive here that is going to help you free money up in your spending plan or in your budget. And you can apply the savings towards debt. You can easily free up 100 $200 by canceling a few subscriptions or visiting a few subscriptions. The other things I like to do, even if you say like on your birthday or you’re going to do this or in the beginning of the year is to call and negotiate your subscription. So like, I know something that easily creeps up as my alarm system every couple of years. They like to make it go up like two, $3 every year. I call about it and tell them to give me my two or $3 back. And it doesn’t sound like a lot of money, but $3 a month is $36 a year. And I don’t want to give it to you because it’s my money. Similarly, if you are in a contract with your Internet or cable, you can negotiate your. Auto insurance. You can negotiate your home insurance, you can negotiate your cell phone bill, make sure that you’re on the best plan possible. But all of those choices, especially if you’ve never done that before, can help you save five, $6 a month. And if you spread that out over a couple of different subscriptions, that gives you extra money to be able to apply towards your debt. 

[00:24:09]  So you can, like I said, think about decreasing your expenses and you can think about increasing your income. If you do both of those, you’re going to have more money to be able to put towards paying down your debt. So I feel like I have spewed a lot of things to you said a lot of things to you, I should say. And this is not to say, like will Keina told me exactly how to pay off all of my debt, but I want to give you a starting point, because I think debt is a really big conversation that we have. And I want to share my personal experience, talk to you about how I’ve supported clients in doing this, but I also wanted to give you some of the mindset that you can also couple in being able to pay off your debt. 

[00:24:52] If you are someone who is running a side hustle and you are running or you actually are working a corporate job as well, like there are so many possibilities with how you can set up your business finances one to build a healthy business, but then also be thinking about like, how do I potentially start paying myself a little bit to supplement me being able to pay down debt on the personal side so that if I want to make the decision to go full time for myself, I’m not worried about that type of liability. If you never thought about having a side hustle, maybe you do have a side hustle because you’re like, Oh, there’s this opportunity to pay off my debt. I know one of my clients while we were working together, I helped her monetize the skill and she was able to pick up her first client while we were working together. So I’m always helping and trying to help my clients think about money differently. Like, yes, we start with a budget, but we’re really diving into different things that impact the way that they think about and manage their finances. 

[00:25:51] Because ultimately, I want you to have a drama free life when it comes to spending money. And I want you to have a plan that you feel really good about. Whether that’s the goal is to save money, the goal is to pay down debt. But my ultimate goal is to help you be able to say yes to possibilities that you never thought were possible. So if you are looking for someone to help guide you as you look to change your relationship with money and this idea of drama free spending, like, you know, you can go buy the fancy cheese and not worry about it. If that appeals to you, you know, you can go to the grocery store, not be looking at your banking app, apply to work with me and my five month coaching partnership, and we will spend five months together really diving into your finances and building a system that works for you in managing your finances, but then also being able to build and support your financial confidence in your ability to make financial decisions day to day, week to week and month to month, but ultimately helping you build a life that you love. So I look forward to connecting with you. If you want to apply to work with me, go to And have a great week. 

[00:27:05] Thank you so much for listening to Money Files. If you’re ready to take the next step to reach your financial goals, head to and let’s get started. 

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