Everyone makes mistakes while paying off debt. We have all been there!
Today’s post is by my friend Charissa – enjoy!
I must admit something. I was not a shining example on how to best pay off debts! There were plenty of dumb mistakes I made while paying off debt.
Regardless, the story ends well and I paid off $7,661 in total debt while putting my hubby through school!
So, what mistakes did I make? Here’s a list of mistakes I made while paying off debt (so you don’t have to).
12 mistakes I made while paying off debt
1. I did not follow a debt snowball.
A debt snowball takes the smallest debt and pays as much as possible until paid off, while paying minimum payments on the rest, then adding the first payment to the next debt.
I jumped around and did not pay off debts in order.
Paying off smaller debts first would have kept my motivation high.
This is one of several mistakes I made while paying off debt.
One helpful tool to learn more about the snowball method is Dave Ramsey’s book The Total Money Makeover.
2. I forgot to include necessary categories, like car repairs, in my budget.
This lack of planning caused the 3rd mistake.
3. I kept charging on my credit card.
I added $1,000+ in charges before closing the card after paying everything else off.
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4. I paid extra only on the car loan.
I had been paying more on my car loan before getting married and continued with the extra amount, but never increased the payments on other debts.
5. I did not cut my lifestyle expenses much.
More mistakes I made while paying off debt were we took trips, ate out, and bought what we wanted. I fit monthly payments around lifestyle expenses.
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6. I did not have a solid plan to attack my debt.
I tried to budget and pay off what I could, but did not detail a plan on how and when I wanted to pay everything off.
7. I never hustled to work more and bring in more income.
I did not want to work more hours than was comfortable and therefore stressed about money. I started hustling after becoming debt free.
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8. My hubby and I did not work as a team to pay off our debt.
We were in agreement about getting out of debt; however we did not share the passion and hard work of paying everything off.
9. I was spotty about budgeting.
I hated budgeting and panicked, thinking a budget showed how I failed with money so I avoided budgeting. This was one of the biggest mistakes I made while paying off debt.
10. I did not apply my raise as extra payment amounts on my debt.
I received a raise in our two-year battle with debt, but only increased lifestyle and paying cash for hubby’s tuition.
11. I was not mad at my debt.
Hatred towards debt brings a willingness to do anything necessary to pay off debt.
12. I did not have a clear picture of why I wanted to be debt free.
I only wanted to see my husband graduate with no loans. But now being debt free, I have the freedom to save for the future, give to others, and enjoy the fruits of my labor with no regrets.
Looking back, I wallowed in debt longer than I should have done. Don’t make the same mistakes I made while paying off debt! Set a plan, use a budget, hustle, sacrifice while being furious with debt and you will be able to clean up your debts quickly.
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What mistakes did you make paying off debt?
Author: Charissa Quade became debt free while cash flowing her hubby’s education. She and her husband live in the beautiful Southwest desert of Arizona where Charissa uses her expertise in living debt free by following a shoestring budget to encourage others to take control of their finances. On her website, Cook With A Shoe, she shares tips on how to handle money well and takes the scary out of budgeting. Connect with Charissa on Face Book, Twitter, or Google +.