What if I told you that it's possible to erase thousands of dollars of debt by
employing a few key money management principles well in this video I'm gonna
share with you exactly how I paid off 25 thousand dollars worth of debt in a year
and by following these steps you too can be debt-free in no time and if you're
new to the channel hit the subscribe button below now before I get into the
exact steps I took to pay off twenty five thousand dollars worth of debt
let me quickly share with you how I got into this financial mess in the first
place when I was in my early 20s I'll admit my spending habits weren't the
greatest for instance nights out at the bar with friends routinely cost me a
couple hundred dollars which overtime amounted to a pretty large amount of
money unfortunately this type of frivolous spending was only part of the
problem at that time in my life I was extremely focused on impressing others
he opposite-sex to be more specific and this again prompted me to spend from
new clothes to fancy dinners it's safe to say that my more useful years were a
spending disaster now fortunately I was living at home at this time so the
financial damage was not exacerbated by having to pay thousands of dollars in
living costs but with these bad spending habits added to a sizable amount of
student debt I found myself in $25,000 worth of debt after a few years of this
reckless behavior I had an epiphany one day I was cleaning my room when I came
across an earning statement from my final year of college as I skimmed over
the paper I saw my annual income was twenty thousand dollars well was now
making significantly more of my full-time job it hit me hard that I was
in more debt than I used to earn in a whole years worth of work it was at this
point that I knew I had to confront my money troubles and get back on the path
to a debt-free life my first step in eliminating my debt was rather
unorthodox having a type-a personality I have always been driven by goals
therefore before paying down even a cent a debt I wrote down exactly how much
debt I wanted to pay off and in how long while ambitious I wrote pay $25,000
worth of debt in twelve months and with that as a new set goal I knew I had
taken an important first step in eliminating my debt for good my second
step to consolidate my debt using a line of
credit at the time I had no idea about debt consolidation but what I did know
is that I was paying a hefty cost each and every month in interest charges at
this point I had about $10,000 worth of credit card debt that had an annual
percentage rate of 22% so every month I was paying more than $100 in credit card
interest which was only compounded by my monthly student debt charges luckily
after talking with my bank I was able to put my twenty five thousand dollars of
debt on a low interest line of credit which instantly shrunk my interest
charges from about two hundred dollars a month down to just thirty my third step
in paying off twenty five thousand dollars was setting up a budget up until
this point I had never budgeted my spending let alone tracked it on a daily
basis so one night I sat down and wrote up my estimated income for the upcoming
month as well as my typical expenses like cell phone groceries bus paths etc
I even budgeted for my nights out which was a telltale sign that I was taking my
finances more seriously once I had my budget in place I knew that following it
would be a challenge so I began to consider methods to help me adhere to
this money management tool one night I was at the gym for my weekly personal
training session when my trainer asked me how I lay it stuck to my die at the
previous week proudly I told him that I had not deviated from my diet all week
and that in fact I had lost another two pounds then it hit me
I need a money trainer I then asked my good friend Justin to check in on my
budget adherence on a weekly basis which overtime really helped me stay on course
after a few check-ins with Justin it became clear that most of my slip-ups
were linked to credit card spending it was all too easy for me to charge my
credit card went out of the store as each top of the machine didn't even feel
like I was spending money so after realizing my ongoing mistake I chopped
up my credit cards and committed to only spending cash until my debt was paid
about six months into my debt elimination journey I was starting to
make a dent in my debt but to be honest I was feeling rather discouraged having
paid off about ten thousand dollars in the first half of the year time wasn't
on my side if I was gonna pay down the rest of my debt within my
previously established twelve month time frame my problem didn't relate to
spending less as my budget was super tight allow me to funnel almost all my
disposable income towards paying off my debt my real issue was that I wasn't
earning enough to pay down my debt faster you see at the time I was making
about three thousand dollars a month after tax and was shoveling just over
fifteen hundred dollars of it onto my line of credit unfortunately if I wanted
to pay off the twenty five thousand dollars in twelve months I would have to
pay down fifteen thousand dollars more in just six months time require me to
contribute in extra thousand dollars a month towards my debt however there was
no way I could reduce my expenses to allow me to contribute more so instead I
had to focus on making more money being an accountant I knew that people hated
doing their taxes themselves so I figured this would be an excellent way
to make some extra cash after offering up my services on Craigslist I started
working with multiple clients every month which helped me generate a good
amount of extra income after the 11th month of my debt elimination journey I
looked at my line of credit balance and realized that my extra work had really
accelerated my progress in a five previous month's I paid out another ten
thousand dollars leaving me with just five thousand dollars more to pay
however even with this increased income I was still only able to put two
thousand dollars a month on to my debt meaning that I would be three thousand
dollars short at the end of the twelve months in order to make up that extra
$3,000 I began looking on Craigslist for extra jobs to take on when it came
across an ad for a use TV it then hit me that I didn't necessarily have to work
to make more money and that I could instead sell off a few of my possessions
to make up the difference after scanning my host for things to sell I gathered my
mountain bike some gaming consoles and a lot of sports memorabilia which is able
to sell for a few thousand dollars fast forward to the end of the 12th month
where I had made my final payment on my line of credit completing my $25,000
debt elimination journey and starting my new life as a debt-free individual
thanks for watching if you want to go from the life you have to the life you
deserve then hit the subscribe button now
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