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by Kate Sortino
Unless you are born into a super-wealthy family, there’s no quick fix to debt repayment. It takes a lot of time, hard work, sacrifice, and effort. However, I learned a few helpful things in my many years of getting out from under my crippling, high-interest credit card, student loan, and medical debts. These are some of the tools and techniques I used to pay off $20,000 in debt in less than a year (that I wish I'd found earlier in my journey).
Mint
While there are many budget trackers and planning apps, I swear by Mint. Mint is a site that aggregates all of your financial accounts, allowing you to see your various balances, due dates, and transactions in one place. I started using it several years ago, and frankly, it was a game-changer for me. I tend to take an “out of sight, out of mind” approach to finances, so if I don’t see the money physically leave my hands, it never happened. And I never use cash, so that just meant a lot of my transactions didn’t feel real. I had money at payday, several days later I didn’t, and what happened between those two points in time was a mystery.
Mint changed this for me. I have several different credit cards and bank accounts (for points, rewards, and various banking needs), so seeing all the balances and due dates in one place made me feel like I was in control of my finances. Being able to quickly review what I was spending, where I was spending it, and any trends or areas of concern made Mint an excellent tool for me.
I read once, “You can’t manage what you don’t monitor” and I feel like this is exceptionally true in finances. Once you have your accounts under control, you are free to manage your spending and allocate more to debt repayment. Some people prefer apps like 'You Need A Budget' or 'Quicken,' but those didn’t work for me. Finding what works for you, specifically, may require trying out a few different apps to see which one matches your style.
Record & Visualize Your Progress
Is there a significant difference between $62,000 worth of debt and $58,000 worth of debt? All these numbers just seem astronomically high. I struggled to find any momentum early in my savings journey because it felt like I wasn’t making any progress, despite how much I was sacrificing to pay off my creditors. I didn’t start feeling like I was getting anywhere until I began to track my debt diligently.
I did this in a few ways. I kept a simple outline in my 'Notes' feature on my phone that listed my starting debt and date, and I updated it every time I made a payment — every single time — even $50. Seeing the numbers shrink slowly but surely was more motivating than I can adequately explain. For someone who was in debt their entire life, seeing tangible, numerical progress was a game-changer.
I also made a poster on my wall where I kept track of my progress. Every few weeks, I would fill in the chart with my progress, and seeing the chart was a significant daily boost to keep me on track and accountable to myself.
Don’t Hoard Money In Your Savings Until...
I didn't actually start saving aggressively until my debt was paid off. To me, It didn’t make sense to have money sitting in an account doing next to nothing while I was constantly accumulating a ton of interest on my debt. Yes, I kept emergency savings, but everything else went directly towards my loans, and I didn’t start building up my savings until all my debt was gone.
This will be a controversial point but I firmly believe that you never truly have savings if you have debt. Stockpiling money in a savings account seems like a sound financial decision, but the long-term cost of high-interest debt negates any benefit you might have from cash sitting around in a savings account.
Specific savings are beneficial, like the aforementioned emergency savings and matching your 401k contributions. But I have friends who have spent many years paying religiously on huge debts that never seem to get any closer to being paid off because of the often devastating interest. So, until the debt is gone, I recommend evaluating how you prioritize your saving account(s).
Become Passionate About Payments
I spent many, many years making minimum payments to creditors and seeing nothing change. It wasn’t until I got control of my income and expenses, tracked my debt payments, and started seeing small successes did I kick my debt repayment obsession into high gear.
And when I say I became "obsessed" I really mean hyperfocused on making payments and super ambitious with paying balances down. For a while, it became my life’s primary focus. I worked two, sometimes three jobs. I sold stuff. I listened to tons of podcasts, read financial books, browsed finance subreddits, and watched countless YouTube videos from people with a lot more financial literacy than myself. I put every spare penny I could towards getting out from under the crushing debt system.
During this crash course in economic education, I came to the personal conviction that the American debt system isn’t just a normal part of life. Debt is a way to keep people trapped in unsatisfying jobs making low wages to stay afloat. Debt is a lack of freedom, and I wanted to be free. Realizing this made the short-term sacrifices feel worth it.
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I am completely debt-free now, but I’m by no means a financial expert. Everyone is different, and everyone will have a unique method to repay their debt. However, these are some of the tactics that worked for me, and I believe could work for many other people as well. There’s freedom on the other side of debt, and it’s my hope that these tools and techniques can help other people get to be debt-free, too.
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