Get out of Debt



Paying off a debt feels so good.

Seeing that balance drop down to zero gives me hope that one day soon, I will be entirely debt-free.  Of course, being in the majority of college graduates who are strapped with enormous student loan debt, I know I have at least another decade to go.

I’ve been using a method that was featured on getrichslowly.org, a fabulously simple and straightforward personal finance blog, called “Debt Snowball.”  Basically, you order all of your debts from the lowest to the highest balance and make sure to pay the minimum amounts on all of the debts, except for the one with the lowest balance.  For the lowest amount, you use every spare penny to pay off the debt until it’s gone. Then you move on to the next-lowest and so on, until you’ve eliminated all of your debt.

I have four separate student loan payments, along with one high dental bill and a balance on my UConn account (admittedly from something totally avoidable – campus parking tickets). The two lowest amounts were the dental and UConn bills, so for the past few months I’ve been focusing on paying these off as quickly as possible.  I just finished my UConn bill and will hopefully be able to pay off the dental one this Friday. Success!

For me, getting out of debt has been positive so far: I stopped using a credit card years ago and I’m not planning on taking on any more loans or debt if I can avoid it.  I’m prepared with a good amount of savings in case of medical or other emergencies.  And I’m picking up odd jobs and online work to make a few extra dollars per week to put toward paying down my debt.

What ”get out of debt” method(s) do you use?