College was great, I learned a ton and had a great time. Each year, when it was time to work on financial aid, I signed with little thought of what my career would be or what the expected salary would be. Once I graduated, I had around $50k in student loans. My then boyfriend had another $24k in personal debt so when we moved in together, we knew we needed to keep expenses low and eventually pay everything off. I thought I’d have my loans for 10 years and hoped they’d magically disappear on their own. Art had no concrete plan to pay his debt off.
A family member gave us Dave Ramsey’s ‘Total Money Makeover’ for a wedding gift, which initially irked me because, where’s the fun in that! But after reading through it and starting to listen to his radio show, I began to see how important it was to pay off our debt as quickly as possible. We initially thought we couldn’t do much to increase our salary but we could survive off of a shoe string budget. Luckily, we lived in 560 square foot apartment We shopped at a local discount grocer as much as possible, worked overtime, cut out as much shopping as possible, and ate meatless at least one cooked meal (2 meals’ worth) a week. We were able to pay off my loans in around 352 days. The next $24k came a little bit slower but we were able to pay everything off in 2 years. Another year and we had saved $30k for a down payment for a house. If you find yourself in a mountain of debt, here are my top recommendations:
- Make a budget: How much do you need to survive? What are your base needs and what do they cost? Plan to spend those and save enough for a decent emergency fund.
- Trim the fat: That wireless scale that measures body fat composition can wait till you are out of debt. No expensive seafood nights out, no new clothes unless necessary, no fancy new phones, no upgrades in laptops, cars, housing till your debt is paid off.
- Plan rewards for yourself. If you are in a multiple year long struggle for freedom, it is unsustainable (or was for me) to deprive yourself of every small ounce of joy. If you love to have coffee out and soak in the ambience, plan a cuppa date with a friend or beau each time you hit the next milestone. Whether that’s paying off an entire loan, a dollar amount, or an amount of time dedicated, reward yourself for your hard work.
- Write out each loan and the amount. There is conflicting advice on whether the smallest dollar amount or highest interest rate should be paid first. In my mind, this is arguing over a mole hill. If you’re taking action to better your situation, you are winning. For us, we paid the smallest amount off first. Then rolled the payment from that loan into the next loan until they were all gone. It was liberating to make that last payment. I wanted to scream from the rooftops. It was an isolating experience to be in this zone though, because it is so different from what everyone else is doing. I had people at work ‘jokingly’ ask if I was selling drugs. We had to decline invitations to socialize. I would highly recommend finding your people whether it’s others in the same situation or people who are open to new ideas about personal finance.
- If at all possible, knock this out before expanding your responsibilities. My kiddos are the 2 best things that have ever happened to me. My dog is one of my best friends. She sat with me throughout my nursing school journey and regularly sits with me when I am documenting. But if I had to deal with the unexpected medical bills, growth spurts rendering all clothes and shoes useless every 3-4 months, and the exorbitant cost of childcare, it would have delayed our goal of being debt free (except the house) by years. Any time is a good time to start this journey but it’s much easier to do with minimal extra responsibilities.
- Learn to cook: Pinterest, yummly, and google were my best friends. I have learned to make things I never thought I could make because I have taken the time to learn. Don’t ask Art about the early years though. It was a rough start. There was lots of Sloppy Joes, Grilled Cheese and Tomato Soup, Digiorno, and rice and beans. It wasn’t glamorous but it kept us fed.
- Learn to DIY: Oil changes, leaky toilet gaskets, etc. You can find an instructional video for almost any issue on Youtube. You may need to peruse the comments section to do some QA but chances are, someone has already provided the tools to solve common and simple issues. Obviously I am not suggesting a DIY solution for medical issues or complex plumbing/electric issues if you don’t have a background in that but for the common, easy to fix problems, research a solution before you call a professional.
- Sell what you don’t use: FB Marketplace, Craigslist, Offerup, I tried it all. I made a fair amount of money just selling things I wasn’t using and put that money towards debt payment.
- Pack your lunch. Ignore the chatter at work and the lunch get togethers at a local restaurant. You can socialize when people get back but you don’t need to go to Chili’s to talk shop and spend $30 when you have your $2.50 lunch waiting for you at the office. Meal prep can alleviate the drudgery that comes with a daily turkey sandwich with mayo and lettuce. There are many options for meal plans.
- Stop scrolling social media. Instead of spending your free time looking at all the things you don’t have and wish you did, or falling prey to the numerous ads on your FYP, spend your time reading, doing crafts, or really any other activity. You may learn something that you can turn into a side hustle. Or you may just have fun, which is equally important. Either way, you’re removing yourself from the rat race.
- Find and Define your motivation: Why are you doing this? What is the reason you are acting in a vastly different way than your friends, family, and coworkers? If your convictions aren’t very strong, it will be much easier to flake out on your plan. But if you can clearly define why this is important to you and remember that it’s just a short phase of focus, you will not have as much trouble following your own rules.
- Surround yourself in positivity: I listened to the Dave Ramsey show every single day during my time of paying off debt to remember what I was doing and why. It was so inspiring to hear people in my situation who were 1-2 years ahead and met their goals. It was so inspiring to hear that everyday people can build wealthy and change their future by just making the right decisions early on with money. I will say, I don’t agree with everything Dave Ramsey advises but when it comes to paying off debt, his advice is super solid. I am forever grateful for his words of wisdom and the guidance we used to catapult ourselves from drowning in debt to being debt free.
- Write down your goals. Where do you want to be in 6 months, 1 year,5 years? How can you make that happen? It’s amazing what we can do with overtime or side hustles when we know the timeframe is only 6 months or 1 year. You can really increase your take home pay by setting a goal and a timeframe, and crushing it.
- Communicate: If you are working with a partner, talk about where you are, where you want to be, what’s worked, and what hasn’t. There is nothing to bring people closer together than a common goal. Some of the best memories I have with Art are from this time because we were creative in expressing our affection with limited resources and we dreamed together. Once you have pets or kids, you are more concerned with the growing to-do list and concrete needs, and you let your dreams slip into the background. Daydreaming can inspire us. Be curious about what you can do. I’ve read that if you reach for the stars, you won’t land in the mud. I believe that to be true. You may not get where your goal is but by having a lofty goal and being willing to pour sweat equity into the equation, you will definitely be more likely to get close to your desired end point than if you ignored your dreams and relaxed, making interest only payments like everyone else.
- Utilize an online community. If you have questions, post them to your forum. Heck, if you have a question for me, ask it! I might not know the answer, but I can sure point you in the direction of the resources that have made a difference in my life. Make friends who ground you and remind you of your ‘why’ and it will be an easier journey to the goal post.
- Look at salary increase options. This isn’t always possible and may require some schooling, training, or extensive time commitments but it can speed up the clock. Art changed from a very physically demanding job to a less demanding and higher paying trade. I moved from Public Safety to Nursing in 2 years. It took another 4 years to see a huge shift in salary but it has made a huge difference in my timeline for paying off the house and pondering financial independence, “early retirement”. My ADHD could NEVER retire with no replacement activity. But If we can stop working in roles that severely restrict the timeframe and duration with which we travel, I would love that!
Photo by Towfiqu barbhuiya on Unsplash
Disclaimer: Advice provided on this blog is my personal opinion and should not be used as medical advice, legal, or financial advise. It is always recommended to consult your care provider prior to modifying your diet or physical activity routine. For individual-specific finance/legal questions, consult your financial professional or attorney.
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