How to Get Out of Debt Fast?

Is this you… I’m drowning in debt and I want to know how to get out of debt fast?

Have you finally realized that you are in debt and getting nowhere because it keeps growing.

Well, you have found the right article.

Everyone’s underlying situation is different but the action one would need to take is pretty straight forward.

Line In The Sand

What’s yours? My line in the sand moment was when I went to ask my best friend to borrow some money for the 3rd time and he said, “NO!” That was when I thought to myself that I really had to take control of my finances.

No one else was gonna lend me the money because everyone else had already said “NO!”

I had accumulated 50K of debt over the years. Majority of the debt was from college loans and the rest was from foolish spending.

I bought the latest and greatest gadgets, aftermarket car parts, fancy clothes, partied every night and bought rounds.

At the time, I didn’t even know what a FICO credit score was, and who cared?! I didn’t!!

Living paycheck to paycheck is a real thing. I was there and I had to find a way to stop it.

What’s Your Problem

I thought about possibly using a debt consolidation service but realized that it wouldn’t really fix my issue.

What would happen there is that you’d pay them a fee to manage your debt and make timely payments for you.

I was capable of making my own payments but I was just a little short on income.

At the time, David Ramsey was an authoritative source on different strategies to handle debt like the snowball and avalanche method. It really didn’t matter to me what got paid off when.

I was grasping at straws and I either method would have worked, but choosing which wouldn’t have solved my issue.

It was my spending habits. I was spending more than I had. And I needed to fix just that.

Spend Less or Make More or Both

Below is a near duplicate picture of what my expenses were. I was bringing in 4K a month and all that was left over was roughly $250 which was not much to pay down my 50K debt that was split amongst 4 credit cards and 2 loans. This had gone on for too long and I needed to make some drastic changes.

I started a new primary job that paid a little more and picked up two part-time jobs: one as a waiter and another as a valet.

My total monthly income was now 5.5K.

With the additional income and a few spending adjustments, my cash flow went from $250 to roughly $4150.

First of all, I cut the cable bill. Who has time for TV, when you are working all the time.

Instead of paying a monthly lease on a car, I found a reliable beater for a few hundred bucks.

Living with friends ain’t that bad, especially if you can split the rent.

I cut out 100% of dining out and chose to make my meals at home. I actually went back on that college diet (I’ll write an article on this soon).

Clubbing was not an option, instead I chose to socialize by doing free outdoor activities and read borrowed books (exchanged books with some of my co-workers) on my free time.

Since I really wasn’t driving anywhere other than to work, I was able to cut down on gas as well. Sometimes I’d opt to walk or ride a skateboard to go anywhere close by.

I started spending my money only on necessities.

Results

You see, I could have opted to just make more money and keep my spending habits, but that would have kept me in debt longer.

By making more money and cutting my spending, I was able to pay off my 50K debt in a year.

A year of actual money management training and it allowed me to begin building a savings.

Although it felt like I lost a year of my life, what really happened is that I took control and saved many years where this debt could have lingered and continued to make my life miserable.

It was a lesson that paved the way on how I think about money today. I now think twice on whether I should purchase something or not.

If it’s not gonna save me time or have a return on investment, I’ll usually not buy it. Hey, sometimes I’ll splurge but I now know my limits.

I’m happy to report that since then, I’ve been mindful of my spending and have been able to build up my credit in the 800-850 range and have kept it up for the past 10+ years. I even hit the elusive 850 FICO Credit Score, consecutively.

I will never be in that position again and if you are where I was years ago,I hope this inspires you to get rid of your debt, fast.

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