How to Get Out of Debt

DR JOHN DEMARTINI   -   Updated 3 months ago

If you are in debt, looking for steps you can take to get out of debt, or if you’re inspired to learn how to become financially independent and have your money work for you, then Dr Demartini has some wise action steps you can follow.


Apple Podcasts Spotify Google Podcasts Stitcher

DR JOHN DEMARTINI - Updated 3 months ago

It's truly astonishing how many people live with debt. Several years ago, I conducted a survey and found that, on average, individuals accumulate credit card debt amounting to one-tenth of their annual income. That means that if someone earns $50,000 per year, they can often carry $5,000 in debt on their credit cards.

Debt brings both advantages and disadvantages. When you buy real estate for rental or development purposes, for example, debt can be a beneficial tool, provided that the property's value appreciates and the rental income covers the debt, thereby generating a positive cash flow.

This allows you to leverage other people's money to increase your wealth. However, some individuals make unwise choices by borrowing money to purchase consumables that depreciate in value, as is commonly done using credit cards. This can lead them deeper into debt, and an endless cycle of making money to pay off debt and going into debt to have money to spend.

Your unique hierarchy of values (what’s most to least important to you) significantly influences and dictates how you manage your money. Your financial destiny is intrinsically linked to the hierarchy of your values.

If wealth-building is high on your list of values (in the top 3 values), you are likely to invest in assets that appreciate over time. Conversely, if it holds a lower priority, meaning it’s lower on your hierarchy of values, you might make consumable purchases that depreciate.

If you do not have a high value on wealth building, and instead you exhibit signs of uncontrolled spending, immediate gratification, or the desire to keep up with others, there is a higher probability you’d be susceptible to the enticement of impulse buying and getting into debt.

How to Get Out of Debt

If you find yourself in debt, there are some strategic action steps that can help you transform your debt and set up your finances so that you have your money work for you as its master instead of you being its slave.

What I’m about to share are tangible steps you can take toward becoming financially free.

Suppose you currently have debt. Let's say you have a $250,000 mortgage and are making monthly payments of $2,000. I recommend totaling the debt and then breaking it down into more time manageable increments.

Consider how much this amounts to annually, monthly, weekly, daily and hourly.

For instance, breaking down your quarter-million-dollar debt might mean that you need to earn roughly $15 per hour to service it. This perspective can make your debt more manageable and less overwhelming.

I then recommend converting these smaller and more manageable units of debt into units of service or units of products you sell. In this way, you can shift your focus to providing products or services that will help reduce the debt over time.

Wherever you direct your attention will determine the outcome. If you focus on the debt, it tends to grow, but if you focus on the service, the service tends to grow and the income starts to flow which means you can put a portion of your additional income into paying off your debt and even build your savings and investments with the rest.

Your attitude also plays a significant role when paying off debt.

Resentment towards debt makes it harder to pay it off. Studies have shown that people paying child support to an ex-spouse they resent are less likely to meet their financial obligations. Why? Because they likely have an unconscious motive not to do so.

The same principle applies to you. So, if you have debt that you have already incurred and are inspired to pay it off, it is wise to list the benefits you've received from it. Even if it's just a valuable lesson in managing your money, being grateful for what you have the debt for can help you pay it off more easily because you’re not resisting it.


Remember that debt can be a positive, neutral or a negative experience. You have the ability to transform how you perceive your debt.

To sum up so far: It is wise to write down the benefits your have received by acquiring your debt to avoid resentment, break it down into manageable portions, and focus on providing services or products to pay it off - servicing the debt.

When considering new purchases, ask yourself whether the item will appreciate or depreciate in value.

For example, if you buy something that APPRECIATES (or goes up) in value, you're essentially investing in an asset that will grow in worth over time.

For instance, if you purchase stocks in a company or invest in an index fund, such as the S&P 500, which comprises various quality companies, you can reasonably expect that its value will increase over the course of a decade or even 20 years. In essence, you're putting your money into something that has the potential to appreciate, allowing your money to grow by compound interest.

On the other hand, if you acquire something that DEPRECIATES (or goes down) in value, such as a swimming pool for your house (unless it significantly adds to the property's value), or clothing that doesn't guarantee a higher resale value, you may find that you're essentially spending money that's going down the drain.

This holds true for vehicles as well, unless you're certain they will appreciate in value. Therefore, before making an impulsive purchase and seeking instant gratification, it's wise to evaluate whether the product justifies its cost in terms of the money it could potentially generate in the long run - not just the immediate gratification it offers.

Consider the number of hours you have to work to save a portion of your income to afford the things you want. This perspective can prompt you to think about what the real cost of a purchase is in advance.

Be mindful of impulsive buying

It is wise to make informed decisions instead of impulsively buying. Keep in mind that when you visit a shopping mall, salespeople will tend to use various tactics to encourage you to make purchases, and it may not always be something you genuinely want; rather, it's often an impulsive buy.

Impulsive buying often leads to unnecessary debt, especially if you use credit cards. This can prove to be a costly lesson unless you consistently pay off your credit card balance every month on time, as interest rates can be exorbitant.

If you find it challenging to manage your credit card payments and are accumulating debt, it may be wise to consider cutting up your credit cards. Instead, opt for cash payments when purchasing items. This will encourage you to be more selective in your purchases and reduce the likelihood of incurring debt since you're directly paying for your purchases.

The longer the time between the pleasure of buying something and the pain of paying for it, the less aware you tend to be of the cause-and-effect relationship. In other words, if you're given a credit card and purchase something, only to pay it off 30 days later, you may not associate the pain with the pleasure.

However, if you pay with cash and experience the immediate pain of parting with your money, you'll likely be more cautious, rational, and objective and be less impulsive when it comes to your purchasing decisions.

I often speak about the brain’s two thinking systems when it comes to self-mastery: Systems 1 thinking, which is related to the amygdala and animal behavior, is geared toward survival, while Systems 2 thinking, located in the executive center, is designed for human achievement, and thriving.

If you allow impulses to control your decisions rather than your executive function, your path to wealth will likely be uncertain. Animals do not amass wealth, but humans who apply reason, objectivity, strategy, and employ their executive function tend to prosper.


Pause and reflect on your expenditures and consider whether you are living congruently with your highest values and priorities.

In my signature 2-day Breakthrough Experience program, I show people how to determine their unique set of highest values, prioritize their lives, enhance their self-worth, exercise self-governance, and practice deferred gratification.

I also teach them how to have longer space and time horizons so they’re less likely to get into unwanted debt and more likely to get out of burdening debt.

If you are not living according to your highest value and are not fulfilled and inspired by what you do, you will tend to experience a greater amount of volatility and judgment, which can leave you feeling empty.

As a result, you may tend to compensate for that by buying things that make you feel full. This form of retail therapy offers only transient relief. 

It is wise to recognize that meaningful and valuable actions, which serve others and generate income, contribute to long-term wealth.

Short-lived, immediate gratification or consuming is fleeting and most likely to be unsatisfying.

The Stoics have known about this for generations: the consequences of immediate gratification cost you financially, but long-term vision pays.

Something you can begin taking action on immediately is to take a moment to reflect before making a purchase. In my own shopping experiences, for example, when I go shopping, you will rarely find a salesperson getting me to buy something. I go in there with one clear intention. I know what I want. If I find it there, I'll buy it; and if I don't, I’ll walk away.

To sum up so far: it is unwise to make purchases that burden your lifeThe more mindful you are in this regard, the higher your chances of achieving financial freedom and independence. Stop and reflect on what you're spending your money on and ask yourself whether it aligns with your highest priorities.

Instead of comparing your life to others, compare your daily actions to your highest values.

In the Demartini Method, which I teach as a component of the Breakthrough Experience program, I help people dissolve their emotional baggage, specifically the self-judgments that tend to surface when they're feeling unfulfilled.

As I mentioned earlier, unfulfillment often leads to overconsumption - excessive buying, overeating, and overindulging in drinks.

It's wise to consider the costs associated with these behaviors and the path they lead to - accumulating debt. This can be a valuable wake-up call and feedback that you would be wise to prioritize your life.

I often say that if you're not filling your day with high-priority actions that inspire you, your day's going to fill up with low-priority distractions that don't.

If you find that your life shows evidence of impulsive behaviors and the desire for instant gratification, look deeper to see if that behavior is rooted in unfulfilled higher values.

A case study:

I once had dinner with a lovely lady who carried a relatively expensive purse, priced at $5,700. Curiosity led me to inquire about her earnings—averaging around $120,000 to $130,000 per year. With 20 years of working, her net worth was a mere $800, and she had debts that could potentially leave her with nothing if paid off.

When I pointed out that her purse equated to 3-4% of her earnings, the reality struck her. If she had invested that amount over the years, she could have saved $500,000, rather than spending it on the purse.

The purse was a depreciating asset, and she realized that she had been working for it her whole life instead of making her money work for her.


She considered the wisdom of investing that money over time and growing her wealth. The idea that increasing her assets would make her more attractive to potential partners, including wealthy individuals, also resonated with her.

This change in perspective prompted her to open a savings and investment account and allowed her to view her expenses in a new light. She decided to stop working for immediate gratification and instead make her money work for her, positioning herself as the master, not the slave of her finances.

In conclusion, it may interest you to know that financial independence is not the norm. In fact, approximately 99% of the population does not achieve it. It all comes down to where you choose to position yourself in the game of life. The choices are yours to make, and there are no right or wrong decisions. However, if you find yourself burdened by debt while continuing to engage in impulsive spending, it's wise to acknowledge your role in that situation.

Living beneath your means, finding ways to increase your income, and saving and investing the difference can all help you get out of debt and have your money work for you, instead of you always working for money.

To Sum Up:

  • If you find yourself in debt, consider breaking it down into smaller, manageable portions. Be grateful for the lessons you've learned from it and the benefits you've received.
  • Reflect on whether your purchases align with your highest values and if they genuinely contribute to your life in a meaningful way.
  • Avoid making impulsive decisions and be truthful about the outcomes. If your actions bring true fulfillment, it's likely a worthwhile investment. However, if they only offer fleeting satisfaction, social prestige, and further debt and anxiety, it's wise to take a step back and be honest with yourself.
  • Keep in mind that owning less stuff can free up space, both physically and financially. A significant portion of a house - between one-fifth and one-quarter - is often reserved for storing items that depreciate in value. This means that you're essentially paying a substantial mortgage to house possessions that lose value over time.
  • The hierarchy of your values plays a pivotal role in determining your financial destiny. If you don't hold wealth building as a core value, the likelihood of achieving it diminishes.
  • It's wise to differentiate between assets and liabilities. Many people struggle with this distinction. Instead of mindlessly making purchases, pause and ask yourself whether the item will appreciate in value and enhance your life. If it doesn't, question the importance of the purchase and whether the long-term cost justifies the short-term gratification.
  • The individuals who live wisely, spend moderately, and invest the difference ultimately build prosperous lives that others look up to. On the flip side, you'd be surprised how many people live in large houses with expensive cars while swimming in debt. It's not about how much money you make; it's about how you manage what you earn, based on your value hierarchy.

If you would love some assistance in getting out of debt and/or becoming financially independent, the Breakthrough Experience, particularly the Demartini Method, can elevate your self-worth and help you manage money more wisely. You'll also decrease the probability of having all the emotional burdens that come with debt and learn to manage your life, and your finances, more efficiently.


Are you ready for the NEXT STEP?

If you’re seriously committed to your own growth, if you’re ready to make a change now and you’d love some help doing so, then book a FREE Discovery call with a member of the Demartini Team so we can take you through your mini power assessment session.

You’ll come away with a 3-step action plan and the foundation to empower your life.


Book Your TICKET for Dr Demartini's Breakthrough Experience

If you’re ready to go inwards and do the work that will clear your blockages, clarify your vision and balance your mind, then you’ve found the perfect place to start with Dr Demartini at the Breakthrough Experience.

In 2 days you’ll learn how to solve any issue you are facing, transform any emotion and reset the course of your life for greater achievement and fulfillment.

You’ll unlock your true potential and lay the groundwork to empower all 7 areas of your life.

Get ready to take your life to a whole new level of meaning and purpose.

Today is the day you step into your power and value yourself by investing in your inspired life when you sign up for Dr Demartini’s signature seminar the Breakthrough Experience:

Click HERE to book your TICKET on the Breakthrough Experience