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How I Went From Being $18,000 In Debt To Owning A Small Business In 2.5 Years

I like to refer to summer 2014 as “crying-in-cars-2014,” because I did, indeed, spend June through August of that year crying almost every time I got into my car. I don’t know why, but once I was tucked into my little sedan, all my anxiety and stress bubbled to the surface and came out.

At the time, I was making $900 a month, carrying $18,000 in student loan debt, and had no idea how to break out of the shitty money cycle I was in. I felt trapped by my low income, and was scared witless that this would be the rest of my life. I knew that debt was bad, but paying it off felt impossible. $900 a month only goes so far, after all.

I needed change. I needed action. I needed information on how to make my money work for me. I grew up with very little financial literacy, and shied away from learning about money in my early twenties. Money very much so felt like something for dudes in suits to handle. It was foreign and scary to me, and so I avoided it.

The personal finance blogosphere was my introduction to the world of money. I literally Googled “how to pay off student loans faster,” and fell into a world where people were talking about money from every angle. I found stories of people who had paid off hundreds of thousands of dollars in debt. Stories of people who retired at 30. Stories of business founders who started in their parents’ basement.

It blew my world wide open. I didn’t feel so alone with my money issues anymore. There were other people struggling, too! And they were writing about it, sharing the tools they used to pay down debt, grow their income, and reach for their audacious money goals.

I started implementing some of the strategies I read about online in my own life. Within ten months of my sad Googling, I had paid off all my student loan debt. Within 16 months, I had doubled my Emergency Fund and maxed out my IRA. Last month, two and a half years from crying-in-cars-2014, I founded my own company to help connect women and money.

Of course, almost no one starts totally from zero. I have privileges that can’t be denied: I’m white, college-educated, healthy, and a US citizen. Yes, in 2014, I only made $15,000, but I also wasn’t subject to racial bias, or also trying to feed a family. Yes, I worked five part-time jobs to increase my income, but I also had the physical ability to do that. Privilege goes hand-in-hand with hard work.

To have gone from broke and buried in debt to debt-free and a business owner in two and a half years is incredible. I can honestly say that I never envisioned this for myself. In 2014, I was certain that I’d be making sub $20,000 for my entire life, subsisting on black beans and cereal until my old age.

Because my company is all about giving women real, actionable tips about how to take control of their money, I want to leave y’all with the top three things I did to pay off my debt and increase my savings. Inspiration is great, but you need to know what kinds of steps to take to change your own financial life.

1. Make multiple debt payments a month. Student loan interest accumulates daily. The more often you pay, the less time interest has to grow. That means more of your payment can apply to the principle. I often made five to seven debt payments a month. Sometimes they were big, and sometimes they were just $50. Everything counts, so I encourage people to pay as frequently as they can.

2. Increase your income. I didn’t have a traditional 9-5, so for me, increasing my income meant finding more work. I picked up several part time jobs. At my height, I worked five different jobs. That allowed me to double my income in 2015 to $32,000, which allowed me to make bigger debt payments. Ask for a raise, increase your rates, or find a side hustle to generate more money for yourself.

3. Be relentless. Debt payoff and savings are both a long game. They take time. I was all about debt payoff every day of the ten months that it took me. I thought about it and worked towards it every single day. Dedication to a goal is the only way to ensure success. Keep at it, and don’t give up on yourself.

It was financial literacy, coupled with dedicated work, that changed my outcome. Simply learning about money, and beginning to use it as a tool, changed my entire life. It showed me what I was capable of as an individual, and created a career path for me. I never thought I’d be writing professionally about money. Yet here I am, writing about everything from mortgages to debt payoff, and loving every second of it.

Change is possible. Your present circumstances do not define your future options. Find out what you need to change your life, and pursue it with everything you have. Then watch the magic happen.

Kara Perez is a freelance writer and the founder of Bravely, a company that connects women and money. Visit bravelygo.co, or follow Bravely on Instagram and Twitter.

Image via Unsplash

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  • Ellie Rockhill

    “Money very much so felt like something for dudes in suits to handle.” <– This to me is WHY I LOVE TFD. And why I tell every single one of my girlfriends about this space. <3

    • Kara

      Thank you! It’s so important to realize our own power and control, and not let stereotypes hold us back. I hope you’ll check out bravelygo.co too!

  • Emily

    Kara is AMAZING and I have the privilege of knowing her IRL! bravely is going to do great things, and everyone on here should be keeping up with her. <3

    • Kara

      You are the ultimate babe. 🙂

  • Alyssa

    Loooooved this article and so proud to read yet another Austin-ite on this amazing site!

    • Kara

      Thanks Alyssa! Feel free to email me (kara@bravelygo.co) if you’re in the ATX and maybe we can get coffee!

      • Alyssa

        Oh I absolutely will!

  • Anon

    Congratulations on paying off your debt, but I can’t help but wonder how
    you did it? More specific details would not only be helpful but are
    necessary to realize how plausible your success story is. How did you
    pay your living expenses? $32k is not a lot to be able to both pay off
    $18k of debt and afford rent/food/car payments/insurance/gas/etc. Did
    you live at home for free?

    • Beck

      She probably did a good job at avoiding lifestyle inflation. If she was previously getting by on just $15k, then $32k gives her an extra $17k per year to work with. That gives her an extra $34k over two years to work with! Plus, working 5 jobs means she probably didn’t spend a lot of time eating out, partying, shopping, or doing other things that cost money.

  • Louise Gleeson

    This is inspiring, my debts are not to this scale but I have no EF so these are great tips to help me get started on that.

    I would love to see a post from your on how you set up your business? It is similar to something I have in mind (not finance, a totally unrelated topic) and I would be really interested in any tips you may have. Especially revenue streams. My business would be a service business and would really help people but I am struggilng with working out how to make it a vialbe money making business. I am happy to put all the work in require but because it would be a LOT of work I need to have a plan in place for the future.