Welcome to the Ken McElroy Podcast.
I'm your host Danille here hosting for Ken because he is out traveling.
So I wanted to put together a good podcast for everyone that I feel
it could be beneficial.
And one thing I think a lot of you are struggling with is having debt
and working on paying off debt.
So something that I did in my twenties is I was in a lot of debt.
I had a car payment, credit card bills,
an additional loan payment, and I felt like just,
you know, unattainable that I would ever pay that off.
And I was going in more and more debt every single month.
So what I was able to do is I was able to move home because I was like
24 or 25 years old and work two jobs and get that all paid off
but I know a lot of you, you can't just move back home
because maybe you're older, maybe you have a family,
maybe your parents don't live in the same area that you do.
So I put together ways that you can pay off debt quickly.
And I used a lot of these ways when I was working on paying off my debt.
The first thing you need to do and you have to do this
is use a spreadsheet because if you're not physically tracking it,
there's no way you're going to be able to pay attention to it.
When I hear people say, Oh, I'm going to cut back on my expenses
or I'm going to really monitor my money, if you're not tracking every single thing,
there is no way you're going to be successful in doing this.
And for those of us that have tried to do it
without tracking your money, you know what I mean?
You have to know where every dollar is coming from
and where every dollar is going.
So the way I do it is super basic I just use my notepad app on my iPhone
and I just write down every single expense I have rounded to the highest dollar.
So if it's 2650, I round it to 27
I have a food category, a gas category, a fun money category.
And I know the money coming in every month is basically the same.
Every month I track everything and actually
Ken still makes fun of me because he'll send me to get like
something that's a dollar.
And I put it in my notepad app because I feel like I have
to track every single thing and I still put myself on a budget.
I don't let myself go over my budget for the month.
If I have leftovers at the end of the month,
I do roll it over to the next month, but I don't let myself go over.
And if there's something that I want that's over that amount,
I have to find a way to make additional income or save up to afford it.
So the next step is to address your housing with housing
you want to live somewhere that's safe and nice,
but you want it to be affordable for yourself.
So if you're living in a luxury apartment, do you really need the luxury apartment?
Is that just for your ego?
Could you just live in a modest,
normal apartment and save yourself a few hundred dollars every single month?
Secondly, can you get a roommate like maybe you have two bedrooms
that maybe you have one big bedroom and you wouldn't mind sharing?
There's a lot of people out there right now looking for housing,
and you could get a lot of money for your room.
So I think it's something to think about to bring in a roommate if you can.
Something else to think about is my parents come into town
every march for a month to Arizona.
They rent a one bedroom condo in Scottsdale
for $4,000 for the month, and it seems to go up every year.
But this year it was $4,000.
The girl that live there leaves and goes, stays with friends
for the month because she lives in this condo when it's not being rented.
This is her home but she's making four grand
to go and kind of couch surf for a month with friends.
Now, this is not an ideal situation, but when you're looking
to pay off debt for $1,000 is a lot of money.
And she doesn't have to work any more than she normally does.
She just has to kind of figure out her living situation.
So if you live in a place where you know,
Airbnbs are prevalent, this might be an option for you.
I also know, like Phenix, you know, we're hosting the Super Bowl in next
January and condos are going for like $15,000 for the week.
So look to see if there's any big events in your area where
maybe it would make sense for you to rent your place on Airbnb.
So the third piece of advice
to kind of get this debt paid down is to get a second job.
So it's fine to work one job, but obviously
if you're in debt, you're pretty tight on cash.
That's why you're in debt.
That's why you're spending more money than you make.
And part of it is cutting back, but part of it is making more money.
So especially, you know, when you're in that pay off debt mode,
go get a bartending job, go get a serving job.
You know, go watch dogs on Rover you know, that's an app where your dog said
get something to make extra money because if you can make two or $300 a week
extra, that's going to be 1200 dollars a month.
You could be putting towards paying down your debt.
And remember, once you're out of debt, that's one step closer
to financial freedom.
Just work now so you don't have to work as hard later.
That's always the key.
So part of paying off debt is making more money.
The other part is cutting back
and it's cutting back on things you like to do, like dinners with friends
and going out drinking and shopping and all the things we like to do for fun.
And some people can just put their head in the sand and they don't even you know,
they just don't do that stuff
for two years while they're working and they're paying off their debt.
I am very social, so it is not an option for me.
I would be miserable if I just didn't hang out with my friends
for a while and miss out on all this fun stuff.
So basically I just had strategies
around doing things with friends to save money.
So for example, if my friends invited me to dinner,
I would still go, but I would eat before I went,
and then I would just get a really small appetizer like a side
salad for like eight or nine bucks at dinner
while everyone else is getting $30 entrees because I had already eaten.
But that allowed me to still be social without spending a lot of money.
And then secondly is the drinks, right?
Drinks are expensive,
so I might have a couple of drinks before I go or I might
just get like a soda water, which everyone thinks is a vodka soda all night,
which all of that cost me as a dollar to tip the bartender to make it for me.
And that way I'm still being social without spending $15 for a drink,
because that really can add up for a lot of people.
And then for shopping for me like some people
really like to shop and they have a lot of fun with it.
And you can still shop on a budget.
Like you can shop at TJ Max, you can shop at Target.
You just have to take down
from where you're used to shopping and spending a lot of money on that, right?
So if you're spending, you know, ten, $15 for a dress,
then that's going to be a lot better
than spending $100 a dress at like Nordstrom or something.
So those are my that's my advice to you.
I really think that you need to focus on
getting out of debt because that's the first step
you can't do anything till you're out of debt
and the credit card interest rates are adjustable
and at times of rising interest rates, those are going to go up
and you're never going to be financially free.
Until you break away from this pile of debt that you're sitting on.
So use these strategies and then you can start saving
for your first house or your first rental property.
After you get your debt paid down.
And it's totally doable.
I've done it and you can do it too.
So we'll see you guys next week.