Be Gone, Debt!

Who doesn’t enjoy a good “I figured out how to pay off my debt” story. Our friends at LearnVest has a piece by a woman who paid off $90,000 worth of debt by examining her finances and learning to cut back:

Rent I gave up my Dupont neighborhood studio and found a roommate in a cheaper neighborhood, which halved my rent.
Cable I canceled my subscription, and streamed shows for free on my computer instead.
Gym Rather than pay $95 a month for health club membership (D.C. gyms are expensive!), I started using the free facility at work, joined a running club on Meetup and streamed free workout videos online during rainy days.
Phone Bill I limited my data usage and calls, and switched to a plan that cut my monthly bill by $30. I even told friends not to text me!
Entertainment Instead of relying on happy hours and dinners out, I found free events on Meetup, like hiking trips and book clubs. Or I’d invite friends over for food, and they’d bring their own beer. I also only ate out if it was beneficial to my career, like networking lunches.
Travel I went to Peru in the winter of 2010, and this year, I’m planning on Malaysia—both countries where the exchange rate is great. I stayed in hostels, and ate where locals do instead of going to pricier tourist spots. Plus, I put a little aside each month, so the expense is built into my budget and doesn’t take away from my savings.

In addition to cutting back, she also found a bunch of side gigs, including participating in focus groups, and doing mystery shopping. Side gigs! Helps get you out of debt, and gives you the extra cash to eat out at nice restaurants, as we’ve learned from Yaffa today.

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31 Comments / Post A Comment

highjump (#39)

I was skeptical about this because people in DC can make a LOT of money, but her salary was $50k. Not poverty wages, but not defense contractor money. Good for her.

probs (#296)

@highjump also, a lot of younger people who entered the job market here in recent years don’t make a ton of money as compared to the high cost of living, or at least that’s true with my friends and I. But yeah, some people bring in beaucoup ducats.

KatNotCat (#766)

@highjump “I was skeptical about this because people in DC can make a LOT of money, but her salary was $50k.”

Sweet baby Jesus, I need a better paying job (I live in DC).

highjump (#39)

@KatNotCat Hope you don’t want to work on the Hill.

KatNotCat (#766)

@highjump No, but I’m in the non-profit realm, so not I’m not much brighter that that.

I manage my money decently so I’m fine, but your post does bring to mind my many friends who make similar money to this woman and do not make similar money decisions. Many of them will argue that $50,000 simply enough in DC without doubt but clearly its more than possible. I don’t think that’s what you were saying, just triggered the thought.

KatNotCat (#766)

@KatNotCat And I just realized the woman in the article works in non-profit as well. Damn it.

Emma Peel (#317)

@highjump I’m not sure how she was affording all of that to begin with, as someone who lives in DC and makes about 10 percent less. I pay less than $1000 in rent, ~$300 on long-term debt, don’t go to the gym or have cable, and still run out of monthly money way quicker than she seemed to.

EM (#1,012)

@highjump She notes that she got five raises in three years that bumped up her salary by $20K though— pretty fly.

aetataureate (#1,310)

“If you pay off your student loans in three or four years, I will spend that time saving money. I won’t go out, and I’ll stay home with you,” he said. “Then I will have saved enough money so that we can start building a life together.”

OH my goodness, so sweet. I like them both!!

AitchBee (#3,001)

Cutting out or reducing moderate expenses and taking on side jobs are definitely good money practices, and I’m sure they helped her pay down her debt, but the article seems to skew a little “Cut out your daily latte,” while the real lesson is probably “avoid lifestyle creep when you get your TWENTY-THOUSAND DOLLAR RAISE”.

ThatJenn (#916)

@AitchBee Yes, this. (I wish I worked in an industry that rewards good performance, or even cost of living increases, with raises.)

WaityKatie (#1,696)

@ThatJenn Please explain what is a “raise”?

ThatJenn (#916)

@WaityKatie The raise is a lie.

Quinn A@twitter (#1,008)

I haven’t read the article, but my immediate thought was “ugh, I’d rather have debt than a roommate”.

WaityKatie (#1,696)

@Quinn A@twitter Word. I have lived in literal holes to avoid having a roommate, and I don’t really regret it.

If my office had a free gym, why would I pay for a gym? Even if it’s nicer? No! I also apply this logic to office coffee.

WaityKatie (#1,696)

@The Dauphine Yeahhh but it sometimes depends on how emotionally scarring it is to have to see your elderly male bosses (esp. if they happen to be politicians or political appointees) in various horrifying states of undress.

@WaityKatie
That didn’t occur to me. I can see how it would be very scarring.

EM (#1,012)

I was sort of floored less by her debt-paying-off (impressive!) and more than after six months of dating this guy was like “I will reward you for paying off your debt by purchasing us a home when you’re done.” That’s basically a marriage proposal with a big fat caveat. They sound like they were both into the arrangement, so cool, but if one of my friends said her boyfriend of half a year was bribing her with A Future Together to change her lifestyle, I would raise some serious eyebrow.

josefinastrummer (#1,850)

@Michelle If my friend told me a guy bribed her to lose weight or change her looks, I would tell her to tell him to get lost. But if a decent guy told her to get her financial act together, I would want him to stick around, so long as he wasn’t a monster about it. She says in the comments that the boyfriend was actually the person who kept her sane and told her to take a break once in a while.

EM (#1,012)

@josefinastrummer Totally. It works in this situation because they were both on board and it was a positive move. But I usually feel like predicating the future of a relationship on someone making a huge lifestyle (or personality) change is bad idea.

acid burn (#113)

Every time I see articles like this I’m so excited to learn some SECRET and then I find out it’s just that they cut out all these expenses that I don’t really have in the first place (except for rent). But I would like to find out how to be a mystery shopper, because that’s always sounded fun to me.

WaityKatie (#1,696)

@acid burn I know I can’t be the only one who just spent a probably excessive amount of time online getting rejected for focus groups.

acid burn (#113)

@WaityKatie OOH, WHICH ONES?

selenana (#673)

@acid burn I’ve done mystery shopping and while it can be fun (fancy restaurants) it can also be really lame and more trouble than it’s worth (wading through all the detritus on the floor at Ross to note all the mis-shelved/mis-racked items – are you kidding me?) and you usually have to do the crappy assignments before you can get the good ones. And while sipping fancy cocktails for free is fun, it’s a ton of paperwork for the cost of a meal + like $10.

chic noir (#713)

@selenana Selena, tell us how you became a mystery shopper.

vathe (#5,387)

vietnam tour of viet fun travel,

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