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How I Paid Off $17,000 of Debt in 1 Year

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Since coming out to my family and friends about my debt and this blog, the number one question I get asked is how I’ve paid off so much debt (in particular, my credit card debt). I know I’ve mentioned a few of these things in older posts, but it’s been interesting looking back on the last year and seeing all of the steps it took to get me where I am today. If you’re curious what the answer is, read on…

First, I Moved Home
Yep. I did the one thing no twenty-something wants to do. And moving home isn’t easy for anyone in a family. As the child, I’d built up enough independence that I felt foolish for needing help. And for my family, I was another person in the house who had basic needs, good days, bad days, etc. It’s not an easy decision or adjustment for any family to make, but I’m so incredibly grateful that my parents let me move home, otherwise who knows where my finances would be right now.

I Made a Plan
When I was maxed out, I had four different debts: my car loan (approx. $8,360), my consolidation loan (approx. $8,800), my credit cards ($6,500) and some tuition ($4,455) my parents had paid for. My first plan was deciding which debts to pay off first. For anyone else, the answer would probably have been the credit card debt. But I hate owing “real people” money, so I decided to pay my parents back first. Next, I’d pay off my credit cards. Finally, I’d look at paying my loans off early.

I Set a Goal
I remember making my very first debt repayment plan and thinking I was absolutely insane. Sure, I had scratched out some numbers and imagined it being possible. But saying that you are going to pay off $1,700 of debt per month and doing it are two very different things. Along with making a plan, I kept two images in the back of my mind: 1) my almost maxed out credit card statement, and 2) imagining seeing it say that I owed $0. That was my goal.

I Stopped Having Fun
Ok, that’s not entirely true. But I made paying down debt my top priority and stopped doing a lot of the things I considered fun to make it happen. I stopped going to shopping malls and avoided Amazon at all costs. I opted out of putting any colour in my hair and only got a couple of trims. And I imagine my biggest savings came from how much I cut back on drinking. Not drinking = not starting a tab, not needing late night pizza and not needing to pay for a cab ride home. Being a designated driver meant I got more sleep, suffered from fewer hangovers and, you guessed it, started to #pfworkout! (Ok, that all sounds like fun now.)

I Learned How to Trust Myself
This might sound silly but it’s taken me a full year to trust myself enough to put a credit card back in my wallet. I still have days where I want nothing more than to swipe for a new bed… or at least a new pair of running shoes. But credit card debt is not only stupid to have, it just sucks! It weighs heavy on your mind and costs you more than it’s worth. And I’m finally able to trust myself to use my card as a tool rather than as a second, third of fourth bank account. (Don’t believe me? I’m still going strong without a TV! lol)

So, if you’ve ever wondered how I paid off $17,000 of debt in one year, the answer is simply this: I made it my top priority. And it wasn’t always easy but it’s definitely been worth it.

Has paying down debt ever been your top priority? How do/did you stay focused?

38 Comments Post a comment
  1. I followed about the same path. My steps were more:

    1. Freaked out about the amount of debt
    2. Realized I needed to learn about money
    3. Put every penny I could towards it, while making mistakes along the way (shopping = evil temptress)
    4. Near the last leg of my debt, I lived really.. REALLY frugally

    Cleared $65,000 in 18 months.

    More details: http://www.thebudgetingtool.com/2012/05/21/how-i-got-out-of-debt/

    June 20, 2012
  2. You did some very important things to pay off this debt and that is to give up something to get something. So many people I talk to about their finances have excuses for why they can’t give up cable or cell phones etc. Sometimes I have to wonder if they really want out of debt or hope I can perform miracles.

    Planning and setting goals are so very important as you have realized. We did the same as you however we lived in one room for a few years just to save money. If we take steps to understand our finances and where our money goes it will be easier to achieve what we set out to do. Budget, Budget, Budget and spend less than you earn, I say…. enough said!

    Good for you! You made the right decisions and decisions that most people have a difficult time doing. Moving home with mom and dad is not so bad when you have a goal, and a good one at that.
    Cheers Cait!
    Mr.CBB

    June 20, 2012
  3. I’m still so proud of you! For me, I just keep thinking about the end goal and how nice it’ll be.

    June 20, 2012
  4. I think moving home or in with roommates is probably the #1 way to save money. I moved out of my studio in NYC into a 3 BR with some roommates. Was living alone nicer? Yeah, but putting that extra 600.00 towards my debt felt so much better!

    June 20, 2012
    • Absolutely. I’d still live with roomies, if all of my friends weren’t married ;)

      June 22, 2012
  5. I’m so proud of you! Reading posts like this really inspire me to get more motivated! Right now, I’m torn between saving for a wedding and paying off debt but I’ve been doing both. I don’t want to hold off on having a wedding because I’m pretty deep in debt. But I can do both and make sure that I don’t take on any more debt while having this wedding!

    June 20, 2012
    • You can definitely find a balance. Just make sure you feel like there is progress on both sides :)

      June 22, 2012
  6. Paying off such a large amount in such a short amount of time is awesome. It shows real dedication that most people don’t have for something like this.

    June 20, 2012
    • To be fair, I didn’t really have a choice. I was maxed out and I knew I had to make a huge change. But I think making a debt-free goal is not something most people ever think of… and if they did, I know they could make it happen.

      June 22, 2012
  7. I’m very impressed by your maturity and by how you took responsibility & paid off your debt before it spiraled out of control. I know some people who move back home and just continue racking up debt, depending on their families to bail them out. Your parents must be very proud :) Congrats to you!

    June 20, 2012
    • What a nice thing to say, Pamela! Thank you :)

      June 22, 2012
  8. U go girl! I don’t trust myself yet with my credit card. It will be paid off this Friday (hooray!) but I still don’t think I can be one of those people with limited transactions on my chequing account in order to have a lower banking fee at RBC ($4 a month for 10 transactions) so I am stil paying $11 a month for unlimited chequing… my friends say I should just use my Visa so I can pay less banking fees but I know myself well enough to know I would abuse the plastic… at least with debit I know there’s a limit and I treat it like cash. I am hoping I can get to a point one day when I can trust myself with my Visa.. but today is not that day ;)

    June 20, 2012
    • I’m still not sure that I trust myself completely but I’m conscious of it and that’s what counts. The best part of personal finances is that they are totally personal. You have to do whatever you are comfortable with and what you know you can stick to. But congrats on paying your credit card off today!

      June 22, 2012
      • THANKS! U were so sweet to tweet me and ask :) And yes I agree… it is personal… It’s almost like, now I need to recognize the triggers that usually cause me to reach for it and wrack it up. (omg I sound like an addict lol)

        June 22, 2012
  9. Yupppppppp you did it!!!!!!!!! I had the same mentality. Imagining that 0 balance was really motivating, but also working towards a goal. Some people have a goal of being debt-free but that wasn’t enough for me. I wanted freedom and the ability to save. I wanted different funds to save for. I wanted to feel safe, and know that I had money in the bank if something happened to me.

    I think we all have our different ways, but the main point is that you did it for you, and I really like that point about trusting yourself. I totally believe that is a huge one.

    June 20, 2012
    • Now I just need to work on the savings side of my finances!

      June 22, 2012
  10. That’s awesome! That’s pretty much how I paid off my student loan in less than a year. I lived at home and I made paying that off my main priority. It wasn’t necessarily a fun year, but I’m so glad I did it!

    June 20, 2012
    • That’s so impressive! Go you!

      June 22, 2012
  11. You’re a big inspiration for me! I just cut up my credit cards and I pay my credit cards the day I get paid so that I’m not tempted.

    June 20, 2012
    • Woo hoo! You’ll get your balance paid off in no time :)

      June 22, 2012
  12. No drinking=The smartest thing to do. EVER. I never drank and I have so much more money…and way better memories than my friends^^

    June 20, 2012
  13. That’s a true credit to your determination and will power! I paid off my student loan by following pretty well the same steps, but I think living at home probably helped me the most. It’s amazing how much money you can save when you don’t have to pay rent.

    June 20, 2012
    • Oh, I would’ve stayed there for another year, if it were an option!

      June 22, 2012
  14. Michelle #

    Best. Post. Ever.

    The simplicity in how to deal with debt (i.e. discipline and priorities) is the hardest part, and with you telling it like it is, it will surely inspire people to do the same.

    Congratulations!

    June 21, 2012
  15. I remain super impressed and inspired!

    June 21, 2012
  16. I think the hardest part is giving up fun things (at least the expensive ones). I have friends that complain about debt all the time, but they are always willing to buy new things (that they don’t need) or go out for a night on the town. It amazes me how they will spend $400 on hiking equipment then complain about how they are going to pay off their doctor bills. I admit that I sometimes will do the same thing (not to that extent). Congrats on your accomplishment.

    June 23, 2012
  17. I love this post! Yea you have to give up some of the fun things you’re used to doing, but when you’re top priority is clear and you set your mind to it, there’s no stopping you. Change can be difficult but persistence seems to pay off! :) Good for you. :)

    July 7, 2012
  18. 17k in one year? Congratulations. I was pretty proud of myself for losing 25 pounds so far this year but that’s nothing compared to that. You must feel great.

    August 10, 2012
  19. I just recently found your site and I’ve been reading through your archives on how you paid off all your debt…. SO INSPIRING! Congrats! I am currently in a boat load of student loan debt, so your story helps a lot.

    December 12, 2012
    • Cait #

      You are sweet to say so, Kristen! I love seeing new blogs pop up, so I’m happy you commented. Heading over to yours now… :)

      December 13, 2012
      • Glen #

        Very proud of what you have accomplished.. I don’t have the option of living alone. I’ve cut off my cable and been paying anything extra and more every month.. Debts are falling fast and it’s looking really good!!

        March 8, 2013
  20. Glen #

    Of living at home I mean.. Stupid auto correct lol :)

    March 8, 2013
  21. I’m so glad I came across this archive of yours! I’m on a similar path for my first year of serious debt repayment so this post was excellent motivation! When I first moved home, I NEVER thought I would see numbers like this but each month it grows and grows. Thank you for being such a great role model!

    April 15, 2013

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