Settling debts requires focus, determination and constant motivation. lists the habits and mindsets that can help you repay your debt and reach financial freedom.

If you’re struggling with unsettled debts, you are not alone. Paying off debts can be a long journey and trying to deal with them all at once without a clear cut strategy can be a tad overwhelming.

According to the results of a 2017 survey conducted by, more than half of the respondents have a Debt Burden Ratio of more than 50 percent while 76 percent had missed at least one debt payment in the past.

Many people underestimate how much debt they have. Being financially irresponsible and refusing to acknowledge that you owe money signals what is known as “debt denial”. It is essential that you are completely aware of your debt situation in order to tackle it better.

Here are a few rules of thumb that can help you obliterate your debts.

Evaluate your Debts

The first step is to catalog all your debts with outstanding balance, interest rates, minimum monthly payment and due dates. Next, calculate how much of your income goes into debt settlement every month or your Debt Burden Ratio (DBR). Try to keep this value within 50 percent as recommended by the UAE Central Bank for individual borrowers.

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Decide on a Settlement Strategy

The two most common debt settlement methods are debt stacking and debt snowball methods. While debt stacking lines up your debts in descending order of interest rates to settle the biggest and most taxing debts first, the debt snowball method involves starting with smallest debts to give you a series of quick wins and keep you motivated.

Another concept is to consolidate your debts. This combines all your debts, lowers interest rates and makes repayment more convenient.

Additionally, you can choose to negotiate with your lenders to work out an alternate payment solution like offering a lump sum towards debt settlement or extending the loan tenure. Devising a payment strategy with an experienced credit counselor or debt management company also helps.

Minimize Your Expenditure

A sure fire way to save money is to reduce expenses on everyday items. You can cut back on luxuries and consumables to begin with. This will free up enough cash to settle your minimum monthly payment while also giving you some breathing space.

[Negotiate Your Debt Repayment Plan in 5 Steps]

Maximize Your Income

It is easy to boost your earnings if you learn to place higher value on your time. Although, you can start by asking for a raise or searching for a job that pays better, doing overtime and looking up work-from-home options can be a big help. Supplementary income can go a long way in helping you settle debts faster.

Track Your Progress

Persistence is key once you are on track with your debt settlement strategy. Continue reviewing your progress and re-strategize if your situation changes. Reward yourself every time you achieve your goals. And remember, staying motivated is the secret to success.