How to Manage Debt & Build Wealth at the Same Time

Managing debt while building wealth can feel like walking a financial tightrope. On one side, there’s the pressure to pay down loans. On the other, the desire to save, invest, and plan for your future. The good news? You don’t have to choose one or the other. With the right strategy, it’s possible to reduce debt and grow wealth at the same time.

Know What You Owe

Start by listing all of your debts—include balances, interest rates, and minimum payments. This gives you a clear picture and helps you prioritize which to tackle first. Focus on high-interest debt (like credit cards) first, as it costs you the most over time.

Build a Starter Emergency Fund

Before aggressively paying off debt, aim to set aside $500–$1,000 in an emergency fund. This cushion helps you avoid falling deeper into debt when unexpected expenses arise. Once stabilized, work toward saving three to six months of essential expenses.

Use the 50/30/20 Rule

A simple budgeting framework to help manage both debt and savings:

• 50% of income to needs

• 30% to wants

• 20% to savings and debt payoff

Within that 20%, consider splitting funds between investing (such as a Roth IRA or 401(k)) and making extra debt payments. Even small investments can grow significantly over time thanks to compounding.

Automate What You Can

Set up automatic payments for both your debts and savings goals. Automation removes the temptation to skip and keeps your plan on track without the stress.

Increase Income When You Can

A side hustle, raise, or freelance gig can go a long way. Direct the bulk of any new income toward debt reduction or investments to accelerate your progress.

Avoid Taking on New Debt

Staying out of new debt is just as important as paying down old debt. Be mindful of credit card use, car loans, and other non-essential financing that can derail your momentum.

Let’s Build a Plan Together

At Vertis Wealth, we help you strategically manage debt and grow your wealth without sacrificing one for the other. Whether you’re starting fresh or refining your plan, we’re here to help.

Call us at 774-874-3686 for personalized financial guidance.