When you’re so good at saving money that you can retire at age 31, people understandably want to hear your money tips. That’s how Clark Howard ended up with his own radio show, where he takes consumers’ questions about all things personal finance.
As it often is, debt has been a popular topic recently, and Howard has a few tried-and-true tips he likes to share with consumers. Whether you’re committed to paying down huge credit card balances or simply want to avoid ending up in debt, here are three things Howard recommends you do.
1. Always save some money
Saving money is Howard’s primary approach to getting out of debt. Shoot for a savings rate of a dime per dollar earned (or 10%), but if you’re not saving anything right now, start by setting aside a penny per dollar (1%) and increase your savings rate every six months, he said.
“Now you may wonder, what does this have to do with eliminating debt in your life?” he said. “You have to start off by learning to live on less than what you make.”
Unless you can find a way to make more money, that means you need to cut things from your budget and put that extra money toward your debt (or a savings account, so you don’t have to turn to a credit card in an emergency).
2. Pay more than the minimum
“A lot of people pay the minimum payment because that’s what the bill says,” said Alex Sadler, managing editor of Clark.com. Doing that could leave you in debt for a very long time, so make it a priority to budget for more than the monthly payment. Credit card bills also include a section that says how much you need to pay each month in order to get out of debt in 36 months (three years), which can help you figure out how much room you need to make in your budget to get out of debt.
When you have multiple debts to pay off, Howard recommends using the “laddering method” to save the most money. That means focusing on the debt with the highest interest rate first.
“Keep throwing money at it, and [on] all the others pay the minimum,” Howard said. “Methodically, step by step, work your way to zero debt.”
It helps to make a list of all your debts and their interest rates. In fact, most people who call Howard don’t know how much debt they have, so sitting down and getting a sense of the numbers is a great place to start.
“If you ever want to get out of debt … the first thing you have to do is figure out how much debt you owe, and then you can make a plan,” Sadler said.
3. Find a cheaper alternative
One of the most common kind of questions Howard gets these days is about student loan debt, particularly from older consumers who borrowed or cosigned on behalf of children or grandchildren. As with all kinds of debt, the best thing to do is avoid it in the first place, because once you’re in debt, there’s usually not much you can do to get rid of it other than pay it off. (This is especially true of education-related debt, because it’s rarely discharged in bankruptcy.)
“The reality with anybody approaching college is the cost of college needs to be the highest priority,” Howard said. “You may have your favorite, but if your favorite would put you into very heavy debt or your family into very heavy debt, you need to go with a different school.”
Though he’s talking about education, that approach applies to anything that could put you in debt. You can’t always avoid going into debt, but if you save up as much as you can and opt for more affordable things (like a vehicle with fewer options or a home with most but not all of the things on your wish list), you’ll end up borrowing less and spending less money on interest.
As you work to pay down and stay out of debt, keep an eye on your credit scores. Not only will good credit help you qualify for better terms on things like an auto loan or mortgage, it can also make it easier to get everyday necessities like a cell phone or utility accounts. You can see two of your credit scores for free, with updates available every 14 days, on Credit.com
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This article originally appeared on Credit.com.