I had almost $30,000 in debt staring me in the face.
Treating debt like a necessary part of your life will cost you. What are the costs, you ask? Well…
- Thousands of dollars in interest
- Hours of lost sleep
- Stress levels that not even wine can cure and the most costly…
Step 1: The Plan
In order to tackle the Goliath of a debt, I needed a plan. Something that was actionable, measurable, and ambitious. I also needed a pretty big shovel to fill the hole I dug myself in.
I’ve always been a big believer in the saying…“If people aren’t laughing at your goals, you aren’t dreaming big enough.” My first goal was to pay off my debt in 12 months. When I shared this goal, I not only got some strange looks, laughs, and smirky smiles, but I was also told I set my bar too high.
Thanks to the power of setting goals correctly (and a ton of grit), I actually beat my goal by two months. In August of 2011, I made my final student loan payment. That night, I slept like a baby.
Step 2: The Sacrifice
Part of my plan of paying off my debt was knowing that I had to make some really, really big changes. Cutting out buying coffee twice a week was not going to cut it. To get drastic results, I had to make drastic changes.
My pre-debt freedom situation:
- Owned my own home
- No car payments (thank baby Jesus!)
- No credit card debt
- Was in a serious relationship
- College degree
- $30,000 in debt
- Great part-time job at a spa with extremely flexible hours
- Landed a Staff Accountant position with a flexible schedule
- Rented my home out for $100 per month more than my house payment & moved in with my partner (allowing me to pay lower rent)
- Sold all my awesome furniture (this was a bummer= moment for me, but gave me a nice chunk of cash to start my debt-free process)
- Worked two jobs, 70-80 hours per week
- Didn’t have a day off for three months
- Didn’t buy coffee for 10 months (I almost forgot what the inside of Starbucks looked like)
- Packed a lunch every single day (to this day, I still bring a lunch every day)
The two shovels that I used to fill the large “debt” hole:
- Spa job: This was my job that put me through college. I lived on a solely commission-based income for 4 years and knew I could continue living off of it. Working part-time at the salon meant that my income would decrease to around $25,000 a year. I worked 26 hours a week and made 100 percent commission.
- Accounting job: Accounting is very cyclical business. I was deeply needed for audits and preparing tax returns. I worked at the accounting firm 49 hours per week, and was paid once a month. This check went ENTIRELY to paying for my debt.
I wanted unreal results, and I got them. It wouldn’t be fair if I didn’t discuss the financial tools I used to make this happen.
Next week, we’ll share how these and the perks of living debt free in the Ultimate Guide for How I Paid Off 30,000 in 10 months, Part 2. If you’re interested in connecting with Whitney Hansen for one-on-one coaching, reach out here.
The Complete Guide to Student Loans
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