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3 Tactics I Used To Pay Off $58,000 Of Debt In 18 Months

I understand the mixed emotions when you think about paying off a significant amount of debt. Excitement quickly turns into discouragement. Sending in larger payments only to receive a statement that looks about the same as it did the month before feels like a losing battle. Trust me — it’s not. If you’re able to push past the emotional and psychological resistance, strength and confidence do eventually take over.

Right after I decided to pay off my student loan, I recall staring at the $58,000 statement balance thinking, What’s the point? Eighteen months later, the loan was completely paid off! Let me tell you how I did it.

1. Save Money Wherever You Can

Step #1: Go through your budget with a fine-tooth comb and free up as much money as possible. If you have any loan debt, shop around to see if you can save money by refinancing.

Getting out of debt is about momentum, therefore psychological victories are critical. I understood that cutting unnecessary expenses was an easy win, so the first thing I did was scour my budget for opportunities to free up money. That process didn’t yield a huge amount, but it helped. I immediately applied everything I saved directly to my loan balance.

The other thing I did to save money was refinance the debt. One day at lunch, my coworkers and I were discussing the interest rates on our student loans. None one at the table seemed pleased with their current rate. This prompted me to do an online search for companies that refinance student loans, and I found a company called SoFi. I proceeded to complete an online application and they told me what my interest would be right there, on the spot. Refinancing my loan brought the interest rate down from 6.5% to 4.2% and increased the amount I was paying toward the principle.

2. Set a Goal

Step #2: Pick a debt, any debt. Target a bill that you believe you can knock out and go after it. Be sure to tell someone about your plan. That will help you own the goal and hold yourself accountable.

Getting out of debt does not happen overnight. It’s good to establish some specific goals to keep things interesting. Not only does it feel good to hit new milestones, but there is power associated with setting specific goals.

The second thing I did was set a goal for the amount I planned to pay each month. I started out paying around $800. However, it was still going to take a while to pay off the balance, so I set a goal to pay $2,500 per month. That goal seemed very outlandish at the time. I had no idea where I would get an additional $1,700 every month, but I wrote it down anyway.

After I set the goal, things really began to open up. It took about six months for me to make the first $2,500 payment. Three months after that, I was consistently paying more than $2,500 every single month. I stayed focused, kept praying, kept working, and things turned out very well.

3. Look for Money-Earning Opportunities

Step #3: Research things you could do to make some extra money, pick one or two that work well for you and go at it as hard as you can.

Increasing your income is almost always an option. We live in the world’s most prosperous nation, and there is no shortage of money-making opportunities. If you’re thinking about getting out of debt, bringing in some extra money is the fastest way to do it.

The third thing I did was look for part-time work. Schedule restraints made it difficult for me to find a traditional part-time job like retail or food service. I needed something with more flexibility. A friend told me about an opportunity to become an independent contractor with a well-known energy company. At the time, they were looking for individuals to perform site inspections at different gas stations. I wasn’t crazy about the idea, but the work provided enough flexibility for me to set my own hours. I worked evenings and weekends inspecting gas stations across the Southeast.

The first assignment I worked paid only $34. It wasn’t encouraging, but I had to start somewhere. Over the next six months, I gorged myself on as many of those jobs as I could handle. Then out of the blue, I landed an assignment that paid $1,800! Two months after that, I found one that paid $3,000! All this extra money went to pay off debt.

When it comes to making extra money, there are a ton of opportunities out there. You could:

  • Sell products, online or in person.
  • Hire yourself out as a driver.
  • Rent part of your home.
  • Be a mystery shopper.
  • Participate in clinical trials or focus groups.
  • Write a book.
  • Start a business.
  • Get a second job.
  • Baby-sit.
  • House-sit.
  • Walk dogs.

It’s just a matter of getting out there to see what you can discover. I had to find something that fit my schedule. It’s not always easy to find the right fit, but if you’re serious enough, you’ll make it happen.

In Summary

Getting out of debt is a three-step process.

  • Cut as much fat as you can from your budget.
  • Set goals to keep things interesting.
  • Make money on the side and use it to pay off debt.

Cornelius Davis Jr. has worked in public service for 18 years. Currently, he works with the U.S. Department of Transportation as a Transportation Specialist. He is also a Financial Coach and the author of Want to Change Your Life? This is How You Do It.

Image via Unsplash

  • tamika

    Bottom line, if you want to pay $2500 on your debt, you need to make $2500 more than your living expenses. This article has some good reminders (refinancing, set goals) but make more money isn’t particularly groundbreaking advice and it’s something many would do if they could.

    Things like writing a book or starting a business are generally not viable options that people just haven’t thought of yet — they’re difficult, time consuming, and potentially costly ventures that often leave people in more debt than when they started. I just don’t think readers need the big hook of $58,000 to bring us in to an article where the main crux is to have a friend who knows a gig that pays up to $3000 per assignment more than readers need concrete advice on how people can restructure their budgets or balance part-time work with their full time jobs while still staying healthy and rested.

    • Janessa

      Agreed on all these points! Was expecting some more unique advice given the amount of debt paid off within a short amount of time. I found the bullet points for second income ideas prohibitive and scarily generic given the type of advice typically given out on TFD. I am currently in the process of starting a business for extra income and setting up an LLC alone is costing $350 given state and accountant fees…

    • HL

      Agreed – I had the same thought as well. I’m always a little disappointed to see articles about how someone paid off or saved a huge amount in a short time, only to see tips that, for people like me, wouldn’t even come close to generating that much extra cash per month. $58,000 in 18 months is about $3,222 per month (without interest factored in), and I imagine most of us aren’t going to generate that kind of extra cash by trimming fat from our budgets and picking up the occasional house-sitting gig. With all due respect to the author, he’s pretty lucky to have landed a side gig where he’s suddenly having $2,000 jobs just fall into his lap. Nothing wrong with that but I’m going to go out on a limb and guess that this isn’t a particularly common experience for the average joe side hustler.

      The missing piece in these types of stories is usually that the person is earning a substantial income and/or doesn’t have to pay a large monthly expense like rent. And that’s perfectly fine! It’s just nice when the author is transparent about this so readers can put their story into context. TFD published a story – I think it was by Desirae? – about how she saved half her income, and she was very up front about how being a high earner to being with played a huge role. I appreciated that.