Budgeting · Finances

5 Tips to Handle Financial Setbacks during your Debt Payoff

You’re in the thicks of paying off debt, trying to keep your head down and concentrate. You’re making good progress and paying off debt when you run into some misfortune that gets you sidetracked.

Your furnace goes out.

Your husband loses his job.

You have an unexpected home repair bill.

Your child has a medical issue and you end up with an E.R. bill.

Your car has unexpected repair bills that continue to add up.

When you’re already dealing with the stress of paying off a large amount of debt, an unexpected financial bill like those above could easily get you so discouraged that you just want to give up. 

Along our journey of paying off $245,000 of debt so far we’ve ran into our fair share of setbacks along the way to discourage us.

My husband lost his job and was unemployed for 2 months at the beginning of our journey.

We’ve had thousands of dollars of car repairs

Our furnace went out and we had to add $4,500 to our debt.

We had an unexpected E.R. visit for $1,700 that ended up being completely unnecessary

We had to replace the sewer pipe that connects our house to the street for $11,000 and it wasn’t covered by insurance.

These hiccups along the way always seem to happen at the most unfortunate of times. Dave Ramsey says that once you are headed on the right path God will send you tests. It was right after we paid off a student loan that our furnace went out and it was right after we got below six figures of debt that we had to replace the sewer pipe.

So what do you do to keep yourself encouraged when you seem to have a series of financial discouragements during your debt payoff?

Use these 5 tips to get you back on your feet and focused to pay off your debt after a financial setback.

  1. Take care of the immediate situation

    • If you’re dealing with an unexpected, large financial setback during your debt payoff you need to give yourself grace to deal with the immediate situation. If your husband has lost his job, don’t worry about your debts for the moment and take care of your family.
    • Instead of focusing on how much this expense will setback your debt payoff, do what you need to do to rectify the situation at hand.
  2. Look back at your accomplishments thus far

    • Whether you are just beginning or long into your debt payoff journey, celebrate the financial wins you’ve had thus far. Maybe you’ve paid off $20,000 so far or maybe you’ve just gotten your Starbucks habit down to $5/month instead of $20. No matter how small your victories have been, remember them. Write them down all around you, and you’ll feel encouraged that you can also handle this newest challenge.
    • It was extremely disheartening after 4 long years we had finally gotten our debt down from $245,000 to $96,000 just to have to spend $11K on a sewer pipe just so we could go straight back up to $106K. Instead of focusing on this we talked about how grateful we are that it happened right now and not at the beginning of our journey.
  3. Get back on track with financial practices

    • During financial crises, most people fall off track with using a cash budget, tracking their spending, meal planning, etc. If you’ve gotten off track this is a good time to get back to it! Schedule your next monthly budget meetings with your spouse today. Make a meal plan for atleast today and tomorrow. If you’ve gone back into charging on your credit card, put it away. Maybe you’ve just started to feel sorry for yourself and your financial setback and allowed yourself one too many ‘extras’ in your budget. This is the time to get back to sound financial principles that keep you organized and on track.
  4. Reset your financial dreams

    • Go back to the beginning of defining your financial WHY. Get yourself motivated again about why you want to pay off debt. If you’ve had a big expense that added to your already high debt total you’re likely just questioning why you even want to pay off your debt with intense speed. Take a day to remember your BIG GOALS and you’ll find yourself newly committed.
  5. Renew your motivation

    • Make a new motivation chart. Repost your debt totals around your house. Redo a debt thermometer.
    • Check out these top 5 tips for keeping up your motivation.
    • Whatever method you’ve been using for debt motivation, this is a good time to take it down and make some new reminders.


Whether you are just beginning your journey to pay off debt or you are almost at the finish line, now is NOT the time to give up hope just because of a financial setback! Take care of the immediate situation at hand, remind yourself of your past accomplishments, get back on track with good financial practices, and renew your financial dreams and motivation. You might feel like crying at all of your financial stresses right now but I promise that one day you will sit back and laugh about all of the things you’ve accomplished despite your setbacks.


Share with me! What have been some of your biggest hiccups you’ve ran into during your debt payoff journey? What gave you motivation to continue?

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