Since coming out to my family and friends about my debt and this blog, the number one question I get asked is how I’ve paid off so much debt (in particular, my credit card debt). I know I’ve mentioned a few of these things in older posts, but it’s been interesting looking back on the last year and seeing all of the steps it took to get me where I am today.
First, I Moved Home
Yep. I did the one thing no twenty-something wants to do. And moving home isn’t easy for anyone in a family. As the child, I’d built up enough independence that I felt foolish for needing help. And for my family, I was another person in the house who had basic needs, good days, bad days, etc. It’s not an easy decision or adjustment for any family to make, but I’m so incredibly grateful that my parents let me move home, otherwise who knows where my finances would be right now.
I Made a Plan
When I was maxed out, I had four different debts: my car loan (approx. $8,360), my consolidation loan (approx. $8,800), my credit cards ($6,500) and some tuition ($4,455) my parents had paid for. My first plan was deciding which debts to pay off first. For anyone else, the answer would probably have been the credit card debt. But I hate owing “real people” money, so I decided to pay my parents back first. Next, I’d pay off my credit cards. Finally, I’d look at paying my loans off early.
I Set a Goal
I remember making my very first debt repayment plan and thinking I was absolutely insane. Sure, I had scratched out some numbers and imagined it being possible. But saying that you are going to pay off $1,700 of debt per month and doing it are two very different things. Along with making a plan, I kept two images in the back of my mind: 1) my almost maxed out credit card statement, and 2) imagining seeing it say that I owed $0. That was my goal.
I Stopped Having Fun
Ok, that’s not entirely true. But I made paying down debt my top priority and stopped doing a lot of the things I considered fun to make it happen. I stopped going to shopping malls and avoided Amazon at all costs. I opted out of putting any colour in my hair and only got a couple of trims. And I imagine my biggest savings came from how much I cut back on drinking. Not drinking = not starting a tab, not needing late night pizza and not needing to pay for a cab ride home. Being a designated driver meant I got more sleep, suffered from fewer hangovers and, you guessed it, started to workout!
I Learned How to Trust Myself
This might sound silly but it’s taken me a full year to trust myself enough to put a credit card back in my wallet. I still have days where I want nothing more than to swipe for a new bed… or at least a new pair of running shoes. But credit card debt is not only stupid to have, it just sucks! It weighs heavy on your mind and costs you more than it’s worth. And I’m finally able to trust myself to use my card as a tool rather than as a second, third of fourth bank account. (Don’t believe me? I’m still going strong without a TV! lol)
So, if you’ve ever wondered how I paid off $17,000 of debt in one year, the answer is simply this: I made it my top priority. And it wasn’t always easy but it’s definitely been worth it.
Has paying down debt ever been your top priority? How do/did you stay focused?