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As the Director of Affiliate Relations at HomeFree-USA, I’ve always been fascinated with how people handle their money. Like everyone else, I’ve had my financial ups and downs. In fact, it took me 32 months to pay off $32,000 in credit card bills and build up a six-month emergency fund. While that was a very difficult period, I am grateful – and wiser -- for the experience.

Through my personal experiences and working at HomeFree-USA, I’ve gained a ton of insight that I feel compelled to share. You’ll find those lessons here. Feel free to take the thoughts and ideas that resonate with you most and put aside the rest for later. I look forward to sharing my journey.

Six steps to getting out of debt

I decided to get out of debt because I didn’t like the feeling of being indebted to a company with no real tangible benefits. My credit card debt was a glaring reminder of my lack of discipline, and I was willing to make sacrifices to get rid of it.

I truly believe that when you put something you really want out there, it will come to fruition. A few months after I made the decision to get out of debt, a financial break came and I was able to move forward using the following tactics:


Step One. I set a debt pay-down schedule and kept it above my computer at work so I’d never forget. I crossed off each month as it came.


Step Two. I opened three credit cards under a 0% balance transfer offer and spread out the debt I’d incurred on my two original cards to all five. I used this tactic because your credit score increases when credit card balances are 30% or less of the total limit. My total debt spread across the five cards was far below that amount.


Step Three. I cut up all five cards. The three new ones were a tool, not a means to acquire more debt.


Step Four. I paid down the debt based on the expiration date of the 0% rate. On the remaining I made minimum payments. Once the debt on each of the new cards was paid I closed the account. A new account doesn’t have an impact on your credit like an old one does.


Step Five. I got a side job. Every dollar I made went to paying off debt. 

 
Step Six. I found every means of cutting expenses I possibly could, even when it meant saying ‘no’ to things.


In the last six months I ran out of steam. Yet again, the universe conspired to give me the lifeline I needed when I happened to pick up the book The Total Money Makeover by Dave Ramsey. That encouraged me to listen to his radio show. The very first day I heard people call in and excitedly tell Dave how they’d paid off thousands in credit cards, student loans, medical bills, even mortgages. That gave me all the motivation I needed. The last payment of my $32,000 debt was made on August 4, 2010. On October 15, 2011 I finished building my six month emergency fund.


When challenges come about many say ‘I can’t.’ But it is the truly committed who say ‘how can I…’


And so it is.

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