(Re)Creating Carly











{March 30, 2013}   $4,000 of Debt Gone in 2 Months!

Yep, you read that title correctly. In just two months, I’ve managed to pay off $4,000 of debt. How did I complete this most incredible feat, you ask? Well, I didn’t resort to selling my eggs (mostly because you have to be under age 28 to do so) and I didn’t get a visit from the Publishers Clearing House (do you think anyone has ever really gotten a visit from Publishers Clearing House?). What I did, however, is follow tried and true get-out-of-debt techniques.

Here’s what I did:

1.  Hello (and Goodbye), Tax Return. I put my entire tax return towards my debt. Yes, all of it. Sure, I could have used the money to buy those amazing knee-high boots with the triple-buckle detailing that I really wanted, but I decided having food, shelter and less stress over debt was a better option.

2. Track it. I wrote down EVERYTHING I spent — from the fifty cents I put into the parking meter to my monthly enslavement payment, also known as NYC rent. The simple act of tracking my purchases made me more aware not only of what I was spending but why I was spending. More often than not, I purchased things because they made my life more convenient. But guess what I’ve since concluded? Being broke really isn’t all that convenient. In the end, I decided I could live without much of what I wanted to buy.

I also discovered that what had been slowly killing me financially over the years wasn’t a secret designer shoe addiction or luxurious escapes to tropical islands. It was food. I ate out. A lot. I ordered in. A lot. I threw out decaying produce. A lot. In order to get rid of my debt, I had to get rid of my love affair with Indian take-out. And Brazilian take-out. And freshly made organic juices at the amazing little market down the street. This was not easy. And after a week of peanut-butter and jelly sandwiches for lunch, I started thinking maybe being in debt wasn’t so bad after all (see section on finding support). But, eventually, I decided to become more creative with my groceries (i.e., I learned to cook) and am now eating much healthier for a lot less money.

Once I started tracking my spending, I began challenging myself to spend less on groceries than I did the previous month. I started checking out weekly circulars online, searching for coupons, and stocking up on the things I needed when they were on sale. Although this takes a bit of planning, it’s not nearly as tedious as I’d imagined. “Oh, it’s only a dollar,” I used to say to myself over and over again until all those “only a dollar”s became hundreds of dollars that I could have used to pay off debt–or buy some Indian take-out.

Up until this point, I had been convinced that I didn’t have even an extra dime to squeeze out of my monthly budget to help pay off debt. I was wrong.

willworkformoney

3. Make More Money. Even after the extra couple hundred dollars I managed to save from coupon-cutting and eating in, I knew the only way I was going to get rid of this debt before my 100th birthday was by bringing in extra money. I found a part-time job after work and put every penny I earned from it towards my debt.

4. Find Support. It helps to have a Partner-in-Debt helping you stay focused. My budgeting buddy and I are in constant contact about how we’re saving money or when we’re feeling the urge to cheat. We’re available to talk each other down from the peanut-butter and jelly covered ledge or give each other high fives when we get that $15 bottle of conditioner on sale for $3.50.

I also came clean to my friends and family about my situation, which is crucial. What I found out was that many of the people I know are either in a similar situation or have been there at some point in their lives. People were actually okay with meeting me for hot chocolate instead of dinner or going for a walk instead of going to the movies.

Lastly, I subscribed to emails from learnvest.com, a website dedicated to helping people take control over their finances, and the daily bursts of virtual motivation have gone a long way in keeping me focused.

animalhighfive

5. Sacrifice. Finally, I decided that if I really want to be debt-free, I have to make sacrifices. I capped my entertainment spending at $100 per month. YIKES. This includes meals out, haircuts, clothes, manicures, trips, etc. — pretty much everything that is not a need. DOUBLE YIKES. Although this has been the most difficult part of the process for me, it has helped me prioritize my wants. Do I want to go out to dinner with friends or do I want to buy a new shirt? Do I want to be free from debt or do I want to look cute walking down the street in those knee-high boots with the triple-buckle detailing? Hey, nobody said this would be easy!

It has also helped me become more creative with my free time. I mean, this is New York City–there are a ton of free things to do. (Note to self: write future blog on all the free things there are to do in New York City.)

To be sure, this is just the beginning. $4,000 down. $17,000 to go! But I know if I stay committed and focused on the end goal, before long the money that I’m using to pay off my credit card debt will soon be money I can put towards investments and, occasionally, knee-high boots with triple buckle detailing. And Indian take-out.

How do you prioritize your spending? Do you have any tips for saving money?

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Matt says:

Inspiring! And yes please to a future post about free things to do in nyc…



Carly says:

Thank you, Matt! 🙂 And will do!



Brigitte says:

Way to go, Carly. It’s simple (not really) but you know if you just live below your means, you’ll be okay. And I’m saying “you” in the universal sense. I know this is made even more difficult by living in one of the most expensive places on the planet (geez, why??), but I so admire you. We drive 10 plus year old cars. It’s not fashionable but we’ve not had car payments in years. It’s getting to the point where we may have to remedy that situation and I so dread it, but our priorities have always been traveling, going to new places. That’s another thing — setting priorities as you are so successfully doing.

And yes, post those freebies in NYC because God knows it needs some to offset the crazy expense! Loving your blog.



Carly says:

Thank you, Brigitte! I totally agree with you – the plan is simple: live below your means. The hard part is actually sticking to it. 🙂 I think it’s fantastic that you don’t have car payments. Between insurance, gas, maintenance and tolls, transportation is already so costly. Traveling to new places seems like a much better use of your money.

And, yes! I’ve already started compiling my list of NYC freebies. Stay tuned!



Hi Carly! I just started on the same quest…To become debt free in NYC! I am really good at coming up with yummy cheap recipes so will be happy to share some with you! Best of luck, and congrats on paying off $4K in 2 months. You’ll get there!



Carly says:

Thank you so much! I’d love it if you’d share those recipes with me. I have the bad habit of learning how to prepare a new dish and making it over and over until I can’t stand to even look at it anymore. Best of luck to you as you begin this journey, as well. Hopefully, we’ll be able to help each other along the way. 🙂



Jennifer says:

Great job Carly!Stick with it. I know one of the hardest things for myself is resisting the urge to eat out. I’ve learned to make extra food, if possible, when cooking so I can freeze part of it in lunch size portions for work. Although PB & J does happen quite a bit also. Good luck.



Carly says:

Thank you so much, Jennifer! Not eating out has been the biggest challenge for me, as well! I’m hoping this experience will turn me into a better cook.



Carly any time you want to try an indian recipe – holler. I’m pretty decent at cooking indian food. Well done – proud of you!



Carly says:

Thank you, Brinda! And, yes please. Experiencing severe withdrawals at the moment!



Andrien says:

That was an awesome read. Your tips are simple but helpful. I know this post is a few years old so I want to know how frame you’ve come implementing your methods?



Andrien says:

Of course I mean how far?



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