How Jule Paid Down Her Credit Card Debt After 7 Years
Around here we celebrate your money wins - big and small - each and every week. 🥳 Because taking steps, no matter how small, leads to more steps and our progress snowballs. It’s a beautiful thing!
And now we’re diving into a money win of your choice each month so you can get all the juicy deets.
This month we’re talking to Jule who paid off all of her credit card debt after 7 years.
HUGE congrats on this tremendous milestone. It's so inspiring! How did you do it?
I moved to Los Angeles about 7 years ago from a city that had a much smaller cost of living. It was a huge adjustment to get used to. Between moving and slow lifestyle changes, I had about $10-20K in credit card debt.
​​Despite increasing my earnings every year, with a pretty significant increase between then and now, I never seemed to pay the debt down. I've been in a state of paying it down and gaining more debt over those 7 years, so it essentially always evened out.
18 months ago, I moved into my own apartment for the first time, which led to the most debt I've had, and that was sort of the final straw in my spending habits. So, in January 2024, I decreased my 401K contribution and investments to a minimum (just the percent that my company matches), and also stopped focusing on an emergency fund.
Instead, I used a 0% interest balance transfer credit card to consolidate it all into one place, and I poured my money into paying down the debt. The final push came from my end-of-year bonus, which was the biggest bonus I've ever received at work.
As soon as it hit my bank account, I paid off the remaining balances on my credit cards and then there was a little left to pay off my highest interest federal student loan. I literally woke up at sunrise and paid off my debt while in bed. It felt like Christmas morning came early!
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For those who are so inspired by your achievement and are looking for guidance / advice, what would you tell them?
Don't be discouraged if it takes you a long time to adjust your habits. It took me 7 years to get out of the hole because I didn't want to sacrifice enjoying my life, and I've had a lot of great things happen as a result.
Over that time, I still took a trip to Paris and decorated my apartment. If I hadn't done those things, would I have paid off my debt sooner? Of course. But I was able to be more aggressive about paying it off when it made the most sense to me.
​Have you tried to do this before? What made the difference this time?
I would make good strides in the past, and then reward myself for the effort with things that added more debt (like the aforementioned trip to Paris). I try not to be hard on myself about those things.
What made the biggest difference this time was my hard work paying off with an excellent bonus, which I know isn't possible for many folks. Without that bonus, I think I still would have stayed on track to pay it off in a few extra months, but wiping the debt out in one final swoop was so satisfying thanks to that bonus.
​What motivated you to keep going?
Something that helped me stay motivated over the final 6 months or so is that I built a chart in Google Sheets that showed a visual representation of my progress. I've been using a Google Sheet for 4 years to track my debt on one tab, and my wealth on another.
This year, I decided to look through the revision history of the sheet, and build a line graph from the last few years of data, showing my increase in wealth and decrease in debt in monthly increments. Seeing it all on one page, with my debt getting smaller and my wealth getting larger was a huge motivation.
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What's next for you as far as money goals?
Now that my debt is paid off, I get to increase contributions to my investments again: my 401K, IRA, and shorter-term investment accounts. I think my most important goal is to have an emergency fund with 3-6 months of income saved. I'd also love to learn how to start saving for a house one day.
How are you celebrating this win?
One of the other things I did in 2024 was I banned myself from buying new books because I already owned enough to get me through a whole year of reading.
Now that it's the end of the year, I rewarded myself by stocking up on books for next year that I've been anxious to get my hands on. I built a list over the last year, so I bought books I've been really wanting.