I've recently started reading some of the great personal finance blogs that are out there. (Although this blog does touch on personal finance, I'd call it more of a bargains/coupons blog, or a homemaking blog, or a food/cooking blog, or a shopping blog. Actually a mixture of all of those.)
One blog I came across was No More Harvard Debt. Written by a Harvard MBA graduate in his late 20s working in the tech field in Austin, Texas, No More Harvard Debt chronicles the author's journey in paying off more than $90,000 of graduate school debt.
One of the problems of a blog format is that you read the most recent post first, so the story is kind of spoiled when you go to the site. He set a goal to pay off the $90,000 in ten months; he managed to pay off that huge amount in only 7 months. Wow.
Here's what I learned from his journey:
- It's a lot easier to pay off debt when you're single. Not that I am complaining about the cost of children, but if you're single and you cut back your lifestyle drastically, the only one who suffers is you. In a family, everyone is affected.
- It's difficult to create a new income source. The author tries driving a pedicab and ends up losing money on the deal. He starts a landscaping business with a friend, but gets very little business compared to the amount of time giving estimates to homeowners. He rents out two rooms in his home, which successfully brings in money, but he has to live with difficult roommates.
- To earn extra money, instead of trying new jobs, dedicate yourself to your current job. Over the course of the seven months, the author works very hard on his day job and ends up earning both a raise and a larger-than-expected bonus - and the latter pays off the rest of the debt.
- Dial back your lifestyle to a minimum. Before the debt payoff, the author spent an average of over $7,000; during the debt payoff time, he spent around $3,000, half of which was his mortgage. He analyzes all of his expenditures and tries to bring them down to a minimum. Anyone who is paying off debt should analyze their budget this way, trying to reduce every possible expenditure,
- Sell stuff. To get the debt rolling, the author sells a car, a motorcycle, and a bicycle, as well as other household items. Of course, it helps to have high-value items to sell in the first place!
- Most importantly: Set your goals high, and have complete focus on your goal in order to reach it. You can do it!
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