3 Underrated Tips For Paying Off Debt In 2026, According to Experts

If you’re looking to pay off debt in 2026, you’ve probably already heard all the classic advice.

You’ve probably heard that you should pay off high-interest debt first. But that ignores taxes, transfer fees, and whether your debt bought something whose value is going up or down.

Here are some under-the-radar tips from financial planners that may help you pay down what you owe this year.

Know What You Owe

Not all debt is created equal, so it’s important to understand what type of debt you have to decide how to pay it off.

Scott Sturgeon, a certified financial planner (CFP) and founder of Oread Wealth Partners, suggests categorizing debt into two categories: “less ideal” and “necessary.”

“Less ideal debt” is for buying an asset that drops in value, like a car loan, or has a high interest rate, like credit cards. “Necessary debt” is used to buy an asset that can rise in value, like a mortgage, or that can lead to future income, like student loans.

“Don’t beat yourself up over debt. These companies are making the lending process frictionless,” Sturgeon said.

Sturgeon suggests prioritizing “less ideal debt,” but the payoff method you choose matters, too. For example, if small wins would motivate you, the snowball method, which pays off the smallest balances first, is a good strategy.

But if you prefer to lower interest payments first, the avalanche method can be a good choice because you tackle the highest rates first.

The Tax Angle

Maryanne Gucciardi, a CFP and founder of Wealthmind Financial Planning, suggests looking beyond the advertised interest rate and comparing the taxes involved.

Some debt interest is tax-deductible; some isn’t. That affects your true borrowing costs. Credit card interest, for example, isn’t deductible. But mortgage interest may be—if you itemize, you can deduct interest on up to $750,000 in mortgage debt.

“Say you’ve taken out a car loan and interest rates were almost 7%. That’s after-tax money you’re using to pay off,” Gucciardi said. “If you’re in the 37% tax bracket, the [pretax equivalent] interest rate you’re paying on your car loan would be more.”

So when deciding which debts to prioritize, consider targeting the debt that doesn’t have tax-deductible interest first.

The Balance Transfer Play

Struggling with credit card debt? If you have a solid credit score, (typically a FICO credit score of 670 or higher), you may be able to sign up for a balance transfer credit card, a card that offers a 0% introductory APR on transferred balances or new purchases for a set period.

Balance transfer credit cards typically charge a balance transfer fee.So, calculate whether you’d save more in interest than you’d pay in fees, notes Byrke Sestok, a certified financial planner (CFP) and partner at MONECO Advisors.

“Look for different lending opportunities—whether it’s a home equity loan, 401(k) loan or another option to consolidate,” said Sestok. “Balance transfer techniques are fantastic because they enhance the snowball and avalanche methods. While there’s a fee, if you have a lot of interest, it may be worth it.”

If you opt for a balance transfer, mark your calendar for the date the introductory period ends—once it does, the interest rate typically jumps. The goal: pay off the balance before that date hits.