How I Got Out of Debt

I’ve been meaning to post this for several months, but listening to Marie Ynami interview Christine McKinley on her podcast reminded me. They talked about Christine’s free teleseminar (which is now passed but if you check out her site she offers this information in ebook format) all about getting out of debt.

Basically, this is what I did to pay off my credit card debt:

  1. Stopped using the cards – You can’t get out of a hole unless you stop digging!
  2. Paid off the smallest card first – I did this for the psychological boost it gave me. It had a small balance and getting it over with made me happy.
  3. Created a large visual – I put a large chart on my office wall with my debt, income and savings. It was exciting to see my savings and income grow each month while my debt got smaller!
  4. Sold stuff of value – I got rid of things that didn’t mean a lot to me but that could be turned into cash. And I disciplined myself to use that money towards the debt.
  5. Started an emergency fund first – While this seems backwards to some, it helped me feel safer and in control. I thought it would be awful to get out of debt and then have all 4 tires fall off my car or have some other emergency and have to get back in! So having that “baby contingency fund” gave me real peace of mind and made me feel proactive instead of reactive.
  6. Ramped up my income – I worked hard in my business to step up my earnings.
  7. Tracking my spending - I kept a small notebook in my purse and wrote down EVERY penny I spent. Just the act of doing that curbed my spending! Plus it pointed out weak spots (coffee and books) that I could work on.
  8. Rewarded myself for being frugal - I budgeted a small amount (less than before but still something) on little treats for myself so I wouldn’t feel totally deprived.
  9. Transferred balances – I transferred balances on two cards to one that offered zero interest for 6 months. And I paid it off in 6 months then closed the card. Teehee! I beat the evil credit card companies at their own game!
  10. Read a lot about personal finance – I read a lot of books during that time about debt, personal finance and emotions around money. I discovered some great blogs!
  11. I made sacrifices – I temporarily stopped paying my kids an allowance. I talked to them about my goals, about debt and about what we would do when the debt was paid. One of the things I did when the cards were paid was buy my oldest a guitar. I also didn’t buy myself new clothing for a few months. I just kept focusing on what I wanted, which was to not be beholden to anyone, and did whatever I could to meet that goal, which meant sacrificing things that weren’t as important to me.
  12. I spoke my goal out loud – I shared my goal with others who were close to me, and because of that, opportunities came my way because I had declard my intention.

I hope that helps someone else :-)

Moms Talk Radio

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9 Responses to How I Got Out of Debt

  1. Great Post with some very wise words, it is good to see articles like this that aim to help others with debt problems. If anyone has debt problems feel free to post any questions on our free debt forum.

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  3. caroline says:

    Hi Carrie

    thanks for this blog, it would be very helpful to many if you could share the names of some of the books and blogs that helped you to learn more about debt, personal finance and emotions around money

    kind regards


  4. carrie says:

    Thanks Caroline. I have mentioned a couple of these books. They are:

    Pay it Down by Jean Chatzky:

    Money it’s Not Just for Rich People by Janine Bolon:

    Savvy Saving for Busy Moms by Dar A:

    Living on Less Than $1,000 a month by Tawra Kellem:

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