Friday, November 30, 2012

Take That, Debt!

Today, I made an extra payment towards my debt of a whopping $950!! Eat it, debt! This means by the time 2013 rolls around, I will have paid off around $19,000 of debt in ONE YEAR. SERIOUSLY? How is that even possible?

<---Why thank you, David Brent!

To see how I did this, I went back over my payments. I discovered a few key things:
1) I made quite a few large payments that significantly lowered my principal balance.

  • April 7, 2012 - $2,800 (money I had saved from when I was in school + tax return of about $700)
  • June 5, 2012 - $1,175 (graduation money + waitressing money)
  • June 19, 2012 - $2,300 (my first paycheck at my new job)
  • August 6, 2012 - $1,162 (birthday money + income from selling crap)
  • September 15, 2012 - PAID OFF GRAD LOAN #1
  • November 30, 2012 - $950 (security deposit returned + waitressing for the week)

These large payments alone total $8,387.
2) I put every extra penny of income towards my debt. This included monetary gifts and income from my side job as a waitress.

The rest of the balance was diminished by small weekly payments ranging from $50 - $500, depending on the week. I came up with this money by living in a cheap apartment and by putting all of my waitressing income towards debt. My second-job income since August netted me a total of $3,523.

If you add that to the large payment of $8,387 above, the total now becomes $11,910! This is all WITHOUT my income from my day job being used to bring down my debt.

3) I budgeted monthly debt payments to come out of my paycheck.

Finally, I put some of my monthly salary towards debt. I budgeted the minimum payments of $121 (undergrad loan) and $152 (remaining grad loan) to be paid from the money I made at my full-time job. This ensured that I would always pay the minimum payment on my debts every month.

I am simply AMAZED by this. It was both easy and it wasn’t. The hard part is working the second job. I do love waitressing on most nights. It gives me the chance to be social. But it does make me tired.

BUT, the easiest part was putting this system in place. I made a budget. I paid the minimum payments along with rent and other bills. Then, I decided that anything extra that came in would go towards paying off that debt. After that, the system just started working for itself. That’s what the debt snowball concept is all about. You knock one debt off and then you hit the next debt with an even larger snowball.


  1. Congrats! That is amazing!! Those sacrifices throughout the year must seem worth it now! :)

  2. Yes, it does totally seem worth it! I need to figure out what to do as a reward when I pay off the second graduate loan. For the first one I just went and had a beer with my roommate! I think something else should be my reward this time. Like a massage, perhaps!