Debt is one of the hottest topics in Malaysia today. Why? Because most people just can’t pay for big purchases in cash anymore. Take housing, for example. I remember my mom bought a terrace house decades ago for just RM70,000. Fast forward 10 years, its value skyrocketed to RM500,000! 😱 That’s 10x growth—but salaries didn’t magically increase 10x. Back then, fresh graduate engineers earned around RM1,800. Today? Maybe RM3,000–5,000 if you’re lucky.
So yeah, buying a house in cash today is almost impossible. That’s where debt comes in. But here’s the problem: some people, even in their 20s, are already drowning in loans. If that’s you, don’t panic. I’m going to show you step-by-step how to tackle your bad debts. And trust me, the last step is the most powerful.
Step 1: List Every Debt You Have 📝
First things first, get clear on what you owe. Write down all your debts, the total amounts, and monthly installments. No cheating here—you need the full picture.
Step 2: Prioritize Your Debts 🎯
Once you know what you owe, it’s time to decide which debt to tackle first. Some loans are short-term, some stretch 20–30 years. Prioritize based on interest rates, loan size, and urgency.
Step 3: Pick a Strategy to Pay Off Each Debt 💪
Here are 5 proven techniques to clear your debts:
1️⃣ Debt Swap – Transfer high-interest credit card debt to another card with lower or 0% interest. This reduces your repayment cost.
2️⃣ Debt Stretch – Extend your loan term to lower monthly installments, giving you breathing room. Only use this for cash flow, not to take on new debt!
3️⃣ Debt Snowball – Pay off your smallest debts first to gain psychological momentum. Once a small debt is gone, roll that payment into the next smallest, creating a snowball effect.
4️⃣ Debt Avalanche – Focus on high-interest debts first. Mathematically, this saves the most money and clears debt fastest. For example, pay off a credit card with 18% interest before a car loan at 3%.
5️⃣ Debt Consolidation – Combine multiple debts into one single loan, often via refinancing property or a low-interest personal loan. This simplifies repayment and reduces high-interest payments. But beware—this should be done with expert guidance, as it can extend your loan term and requires discipline.
💡 Pro Tip: Debt is a journey. Even if you use these techniques, the key is habits. Fix your spending and borrowing behavior to avoid ending up in the same trap again.
Let’s Talk Habit-Building
Think of debt management as a lifestyle change, not a quick fix. Track your expenses, avoid unnecessary loans, and pay yourself first.
✅ Your Turn: What debt payoff technique has worked for you? Comment below and share your story!
And while you’re taking control of your finances, here’s a tip I personally use:
💰 Grow Your Money While Managing Debt!
I’ve been using Versa, a super easy wealth management app by AHAM Asset Management Berhad. The interface is smooth, and the experts manage your investments for you. Plus, if you sign up using my referral, you’ll get RM10 bonus after completing these simple steps:
Download: Versa App
Sign up with referral code: UAVR6K5X
Complete onboarding
Make your first deposit of min RM100 into any Versa product
Don’t wait—start managing your debt AND growing your money today! 🚀
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