How much debt have you paid off?: $59,220
What was it for?: Student loan. Hire purchasing furniture. Car loan.
From deciding to become debt free to making the last payment, how long did it take you?: Four years.
What age did you take on your first debt, and how old are you now?: Aged 22, and I’m now 36.
Did you do it alone or as a family?: Mostly alone. My husband is slowly coming on board with my way of thinking, becoming financially secure.
Did you pay off debt from your regular income, take on extra work, or change jobs to speed it up?: Mostly regular income, but we started a business during the first year and were able to use some of the income from that to pay off debt.
Did you sell anything or receive cash gifts to contribute towards your debt payoff?: Not specifically to pay off debt, but I did sell things to increase my income.
What people, books, websites, podcasts, budgeting tools, debt trackers and resources helped you?: You, Ruth! (aww, thanks, I’m always happy to help and inspire 😊). The Budget Mom. Lauren Miller - YouTube I use her budget spreadsheet, and I love it. Debt-free community on Instagram. Lots of free books from the library - too many to list!
Did you keep an emergency fund while you paid off debt? If so, how much?: We were saving for a house deposit, so we always had money on hand. But we got serious about it and created a dedicated emergency fund two years into our debt payoff.
Did you have any setbacks along the way, and how did you overcome them?: I took a $25,000 pay cut to switch jobs to a less stressful role which meant our journey slowed, and it was hard to see our debt-free end date be pushed out. But I am much happier, and I think it’s important to still live and enjoy life while on a debt-free journey.
What tips/hacks could you share?: Budgeting was the key, and realising it was up to me to tell my money where to go.
We got a debt consolidation loan from a bank with a lower interest rate which helped, but I know this could be a further debt trap. I told a friend what I had done, and so she also did this but ended up taking on more debt afterwards.
Was there a structure to your debt payoff? i.e. paying smallest to largest, or highest interest rate to lowest?: Yes. Because a student loan is interest-free, for the most part, I only paid the minimum whilst focusing on the debt that incurred interest.
How did you stay motivated, and what was the most challenging part of paying off your debt?: Following others on YouTube and Instagram has really helped me to stay on track, and unfortunately, the fear of ending up like my mum in retirement with no money and struggling. I did not want this for me or my children.
How did you celebrate making your final payment?: To be honest, not quite there yet we will be this year! I plan on going out to dinner with my family.
Was getting out of debt worth it, and what have you learned about yourself?: Absolutely! I learned I actually enjoy budgeting, becoming more of a minimalist. And getting off the consumer bandwagon has made me much happier.
Will you ever go back into debt again?: Yes but only for an investment property as we have our own construction company, so we would be able to do this at a much lower cost than most people.