I finally paid off my final credit card balance.
I’ve paid off a starting balance of roughly $5,500 in credit card debt in the past year, mostly with the little money I made from blogging. My new job only covered the last bit on one of the cards.
The Beginning: Rising Debts
Like a lot of people, I went through a period where I let my spending get away from me. It started at the end of my senior year of college and continued the year after where it coincided with depression and re-weight gain. The year I spent climbing back up to 251 lbs was also the period of my life where I used credit cards to live.
I covered a lot of things on my credit cards that I shouldn’t have. But I also covered a lot of things that felt essential – my computer for school, my camera that I still use today, the phone and light bills. I didn’t exactly spend frivolously with my cards during the time but because I had no more loan money and a crappy part time job at the time I didn’t know what else to do.
When I needed something, I used my credit card. It doesn’t take long for those purchases to add up.
Fixing Debt Mistakes
Up until now I’ve been working to pay off both of those mistakes I made during my “sad year” after college. Actually, for about two years I didn’t even touch my debt or try to reduce it. I just ignored it and pretended I didn’t make the mistakes that I had. I don’t even want to talk about how big of a mistake THAT was because the amount of interest I paid during that time makes me a bit sad. But this past year I decided to finally do something about it and get rid of the debt. I wanted to be debt free before getting married. I wanted to fix my debt mistakes.
Finding The Motivation
Debt reduction is hard. You are sending money to a company that gives you nothing in return because you already got what you paid for. At times it can feel like you are throwing money away (in a way you are with interest). You also might feel like the debt is so staggering that you might never get out from under it, even if the sum isn’t really that high. These feelings can be a barrier that keeps many people from even attempting to fix their debt problems.
You have to find motivation to pay off debt. You will need a strong source of motivation because when paying off debt aggressively you will probably have to do things differently than you normally would. You might have to stop eating out or stop buying new clothes. You might have to make tough decisions in order to find the money to make your debt disappear.
For me, my trigger was the death of my half-sister in 2010. It was hard to learn that she had committed suicide because she felt so hopeless over her debts and financial life. (There is always more to a person’s story than just one factor, but this was a big factor and one that stuck with me.) It broke my heart. It took me many months to process that event and come to terms with it but when I finally did I knew I didn’t want that to happen to me (or really anyone… ever). She was my initial motivation for learning about and changing my financial life.
Since it takes a while to pay off debt I had to make the tough decisions like living with family instead of being out on my own. Believe me, this was a hard, hard decision because this is usually a toxic environment for me. But I had the new motivation of being debt free. And as always I still had the motivation of doing better and being better for my half-sister who couldn’t.
How I Did It: Paying Off My Credit Cards
There are a lot of different ways to pay off debt. In the beginning I didn’t know what to do so I did what I do best – I read blogs! I read a ton of financial blogs and websites and books and they recommended ReadyForZero which formulated a plan based on what I needed to pay off.
Education really is the first step but it’s only a small part of it. Knowing what to do and actually doing it are two completely different things. I made debt repayment a priority over other things like going on trips (other than necessary ones) and shopping. I made changes to how I grocery shopped like making a meal plan and shopping the sales. I did everything I could think of to save my very limited income in order to use it for debt repayment. I made temporary small sacrifices in order to get rid of the credit card debt. They were necessary when I was unemployed and relying on blog income.
As far as paying off the cards, most financial gurus like Dave Ramsey suggest you pay off the smallest first and move on to the bigger ones. This shows you progress early and excites you to keep going.
I did it the opposite way and paid off my largest card first. I did this mostly because of the difference in interest rates. I also did it because I knew I would feel a lot better once the bigger balance was gone. Sure it took longer but it felt amazing the day I had paid off that one credit card. From there it was just a process of continuing what I was doing so I could pay off the other card.
And now? I no longer have credit card debt.
Weight loss and money management have some similarities. They can both seem like impossible tasks in the beginning but with discipline they are achievable over time. You just have to keep at it even when you don’t seem to be making progress. Over time the little bits of progress you are making will add up to something substantial.
Being healthy isn’t just about exercising and eating right. It’s about being balanced and whole in all areas of your life – including finances. I’m happy to say that this is one area where I’ve succeeded and am now on a great track. I’m feeling positive about the future financially, something I’ve never before felt.
I’m almost more passionate about helping people fix their finances than I am about healthy living. both are so important to me, but the money aspect is close to my heart as it’s something I’ve seen many people close to me struggle with. It’s something I’ve never talked about in depth on the blog before but I realized after going through this process of paying off my credit cards that it is important to share. Being in debt doesn’t make you a bad person. Being in debt is not the end of the world. Being in debt is scary and hard but you can come out of it and you can get help. If anyone ever needs help or wants to talk about these things, please know that I’m here to listen. Just send me a message.
It can take several years to fix the mistakes you’ve made in the past. If you are in debt it might feel like you can’t get out – but you can! It might take a while but it’s worth it.
Tools To Help With Paying Off Debt
The following tools were helpful in my process of paying off my credit card debt:
ReadyForZero – This free tool helps you manage your debt and will help you come up with a payoff plan. Then you can use it to track progress and watch as your debt gets knocked out. Visualizing your progress can really help which is why this free tool is so useful!
The Total Money Makeover: Classic Edition: A Proven Plan for Financial Fitness – Dave Ramsey has helped millions of people get out of debt – me included. Even if you don’t follow his plan 100% it will help you get control and get out of debt. He is super inspiring and I highly recommend this book or any Dave Ramsey product. He also has a inspiring radio show/podcast I listen to several times a week.
Hopefully these or other debt reduction tools can help you pay off any unwanted debt as well. Getting financially healthy is as important as being physically healthy. It all matters!
It’s so interesting how similar being in debt and being overweight are and how similar the processes of fixing both are. I’m happy my life is on the right track all around!