Pay off that debt!

I asked and you answered. You want to hear more on how to pay off your debt. While JP and I are working on paying off our mortgage now, back in 2016 we were working on paying off our student loans and car debt. I briefly mentioned it in my first post, but I will go into more detail here.

Back in 2016, JP and I had just cash flowed our wedding and honeymoon. It was a new year and a new start and we were still use to being tight on our money. We decided to go hard at paying off our debt. We had a $10,000 car debt and $40,000 in student loans and paid it all off in 8 short months. My brother, Harold, and his wife, Katy, had given me a book called, "The Total Money Makeover" by Dave Ramsey back in 2012. I had read that book (and also found $20 in that book) and had agreed with the points in there, taken tiny steps but never really went full on. JP and I discussed it, got on the same page and got busy. I have to say that having a spouse on the same page as you is significant. I really am not sure how people can do this without a support team. Surround yourself with friends, family, coworkers, facebook groups, whatever to encourage you and support your journey. Please reach out to me with any help and inspiration you need. I will be your cheerleader every time.

We took Dave Ramsey's advice and ran with it. He has this thing called, "the baby steps":

We did exactly what he listed out. We had our $1,000 emergency fund, we listed out our debts from smallest to largest and got to work. 

We only bought groceries that were on sale and the only places we ate at was Panda Express, CFA and Chipotle. It's crazy to look back on my spreadsheets and see that we were only spending about $200/month on food. We were inspired and committed. But that's not all. When I say we got to work, I really mean it:

•  We had our full time jobs
•  I started a tutu business on Etsy
•  We did these surveys that would pay us $100+ for no more than an hour of our time
•  We did odd jobs:
• Craigslist - putting fliers on people's doors
• Working at a country club as servers when they needed the help
• Checked bags at the Festivals and other events
• Worked as servers for weddings and private events at people's homes
• House sat for anyone that needed it

My first piece of advice when deciding to let go of the debt in your life is just to get committed to it. There will be days that you will fall off the wagon and spend money where you shouldn't. That is ok. Get back at it. I have a post on finding your why and I think everyone should do that when going after any goal. Why are you doing it? 

You don't have to go about it the same way we did. You don't have to use Dave Ramsey's baby steps. But you do need to list out what you are trying to do and how you are going to do that. I do believe in the snow ball effect versus going after debt by interest rates. Knocking out your debt one at a time will truly inspire you to keep going. 

Paying off debt is going to free you. It will allow you to dream of a life that you didn't think you could have. Others will also judge you. They will tell you all about credit scores and borrowing money at low interest rates and other stupid stuff to hold you back. Figure out what you are willing to do to get out of debt. If you have hundreds of thousands of dollars in debt, just chip away at it. If you are currently in college with student loans, start paying on them now. 

Not everyone agrees with this way of life. But if you study millionaires, they do agree. You wouldn't hire an out of shape person to get you in shape, why would you listen to someone who doesn't have the same financial stability you are looking for? Most millionaires don't have debt and the average millionaire pays off their mortgage in 10.2 years.

Step 1: Why do you want to pay off your debt?

Step 2: What is your plan? Will you use Dave Ramsey's advice? Or something else? Write it out.

Step 3: List out your debts from smallest to largest

Step 4: Put away an emergency fund that you feel comfortable with

Step 5: Aggressively pay down your debt until you are debt free

When I say you should aggressively pay down your debt, I mean every penny you have laying around needs to go on your debt. Decide how bad you want to have zero payments and attack your debt. No more eating out, no more happy hours, no more mall trips, just needs no wants. Once you have no more debt, you can build wealth and go after your dreams. Paying off your debt can allow you to quit the job you hate, become the stay at home parent you have always wanted to be, go on the vacations you have always wanted to go on or give more to the charities you have always wanted to give to. Paying down your debt gives you the financial freedom to live your best life.

Do you have consumer debt? Do you need more advice? Please reach out to me for more support, advice, whatever. I would love to sit down over a cup of coffee and discuss how to help you. If you live outside of Denver, I would love to answer any questions you may have on becoming financially fit. I really am a cheerleader to anyone choosing to make positive changes in their financial life.

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