Ep 30: How I Paid Off 50k In Debt In Under 9 Months

Oct 26, 2020

How I Paid Off 50k In Debt In Under 9 Months

Today’s episode is going to be a little bit different than what I normally put out. It’s going to pull back a layer into my personal life that I’m not necessarily proud of, but I do think it’s really important to be vulnerable and be able to share with you guys the truth about life and how I got through this and how you guys could do it too.

This episode is all about how I paid off nearly $50,000 in credit card debt in under nine months.

Now, obviously, I have made it through this, but I will have to tell you that back when this began when I was under what felt like an avalanche of this debt, I took out my phone and I recorded a video. I was in tears and contemplating filing for bankruptcy. I had no idea how I would get out of this debt because I was paying so much in fees and interest.

Even if I doubled and tripled up on those payments, I couldn’t dig myself out of this black hole and I didn’t have any more money to put on these credit cards.I didn’t know what I was going to do. So I started looking at these debt consolidation companies and realized that they were going to absolutely not only tank my credit, but it felt really fishy to me.

If you guys have ever looked at debt consolidation loans, it’s a very slippery slope, a very scary thing to consider.

At that moment I said to myself, I am not going to file for bankruptcy. I am not going to take help from somebody else. I did this. I’m going to dig myself out of this hole.

A lot of that debt was accumulated from purchasing products that I was selling at the time. So I did have assets and when I say assets, I mean, I did have those products selling and I did have those products in my possession.

So I will say that nearly $50,000 in credit card debt wasn’t just spent on purses and frivolous things and dinners out and vacations and stuff. It was really towards inventory and business things. But at the end of the day, you’re still sinking yourself in this debt.

It feels like you’re just fighting like heck to get out of it… So I sat down and said, you know what, Jamie, you are not going to let this stop you. You’re going to find a way out, you can do this. And I have to say that once I found Dave Ramsey, who is an awesome financial advisor, I picked up his book and started reading.

What I’m going to do is share with you guys, the method that he taught me and how I was able to utilize that method to completely get myself out of debt. If I wouldn’t have used this method, I have no idea what my situation would be like today. Because somehow before I was doing this method, I would be paying off the same amount of money that I continue to pay off. But I was doing it in a different way. And as soon as I transitioned to the way that Dave spoke about, things started to pay off.

 

What is the method and how can you do it for your credit card debt or any other debt that you have, whether it be student loans, credit card debt, anything that you owe payment-wise?!

  1. Start A Spreadsheet
  2. Organize your debts from smallest to largest
  3. Add every single account that you have as either an asset or a debt
  4. Put those debts in order from smallest debt to largest debt.
  5. Take out $1,000 cash as an emergency fund

First, you pay everything towards that one debt that is the smallest.

You continue to pay the minimums on your other credit cards, obviously to maintain your credit score. But, you do not pay more than the minimums on your other credit cards until that first credit card is paid off completely.

Then you move on to the next credit card that had the second-highest balance, and you do the same thing. All of your efforts go towards paying that card off. You’re not saving for the future right now. You’re not putting money in investments. You’re pooling all the money that you can, and you’re putting it and dumping it into that second credit card. Then you just keep going down the line. And what I noticed was that where one credit card had, you know, $6,000 debt in it, another might’ve had $13,000. So instead of me just paying randomly to all these different cards and still feeling sunk, because none of them were getting paid off, I was seeing these cards get a zero balance one at a time.

That kept me excited about paying off the next one. And then one day after what was almost nine months, I was able to pay off the $50,000 and have no more debt at all. After going through that and having that experience, not only do I fully pay them off every single month, but I’m also building up such a massive savings account and never get myself sunk back in that hole.

Again, I’m telling you guys, if you’re in a rough financial situation, I know how you feel. Even if you have assets built up like even if you have your mortgage paid off or your car paid off, it’s still scary.

It’s very hard to start saving money when you know you owe a lot.

So now I’m completely debt-free. I have a zero credit card balance. My credit score went from tanking, absolutely tanking. It was in the low six hundred. And I’ve never had that. I always had an 800 credit score. Now it’s back up to 800. I have zero credit card balance, pay them off in full every single month. I have a paid-off car. And it feels so good!

All my efforts can go to investing in my future, like a house payment, right?

Right now we’re in a rent trap. So to speak, we didn’t know how long we were going to be staying in Hawaii. So we’re renting currently. And more than anything, we want to find a home that just really resonates with us. So we’re fighting like crazy saving up a ton of money.

Obviously, property properties are very expensive here. So we’re really buckling down on saving for that house. But you guys, I couldn’t have done that before I paid off my credit card debt. It’s a process. And it might feel like it’s going to take you so long that you might feel so discouraged and like, Oh, I’m just going to file bankruptcy and then just work, work back from there. But I’m telling you that is not necessary. You guys, you have to follow the steps and I’m telling you if I can do it, you can do it too.

By doing things this way, pivoting how you’re actually approaching your finances. And instead of trying to pay it all off at once, focus on one at a time, chip your way out. And I promise you, you will find greater financial success. Find somebody like Dave Ramsey, find somebody who knows about your finances and have them help you read a book, level up yourself and you can level up your finances very, very quickly.

You guys, I hope this helped. I hope if you are in credit card debt or some type of debt at all, whether that be student loans or a mortgage, I hope that you can learn how to set yourself up financially, because that is so important, especially to have that unshakable money mindset. And if you guys want to go back to episode 27, I want you to get that unshakable money mindset.

I think along with this episode, both of these tools are going to be awesome things to have in your tool belt, and definitely keep your eyes out for coming episodes on how to increase your financial freedom.

If you’re interested in starting a small business or a work-from-home business, something that will help bring in passive income and pay off those debts.

I know passive income is one of the main reasons I was able to get out of debt so quickly.

If you’re interested in joining my tribe for more in-depth training CLICK HERE: https://www.facebook.com/groups/workfromhomebusinessbootcamp

 

You might feel like you’re in a hole. That doesn’t mean you have to stay there. You can get out, you can get other streams of income going that are going to help set you up for financial success.

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