Self-employed 20-year-olds have paid off $ 39,000 in debt in 5 years
Like many Americans, Redd Horrocks got into debt in his twenties.
The Briton from Atlanta began to live beyond her means when she moved into a new loft. “It was wonderful, I organized great parties”, she says. CNBC do it. “[But] I didn’t choose it and honestly couldn’t afford it.
“I chose to keep the peace [with my roommate] to keep me debt free. Everything except the rent was on my credit cards. “
Then she had a car accident. “I had medical bills. My scooter was a write-off, but I still had to [top] all that, the insurance company condemned me, ”she said.
Before she knew it, Horrocks was $ 24,000 in the red with little to pay it off. Then she racked up $ 15,000 in additional debt when she moved to a new city with her boyfriend.
“I was offered a great job in another state. I asked my partner at the time to come with me, ”she says,“ which would mean he would quit his job and I would be the sole supplier.
“Suffice it to say things didn’t go exactly as planned and after a year I was out of a relationship and found myself in debt of $ 15,000 that my new salary was going to take. hardly nibble. “
Now, five years later, Horrocks is debt-free and earns a six-figure income from his home voice over work. His advice to millennials also burdened with loans or credit card debt: “Do the math.”
“Stop spending on your [credit] cards, “she said.” Sit down. Be honest about what is going on with your finances, then decide where you want to be. If you are smart with your money now, you can turn things around and have a healthy financial future. “
She built a professional recording studio at home. In an interview with Forbes, she says she works about 30 hours in the studio per week and earns about $ 15,000 per month.
To pay off her debt, Horrocks first calculated how much she owed. “I sat down and took all of my debt on my five credit cards, as well as auto loans. I made minimum payments on each of them, then every extra penny I paid on the smaller debt, ”she told CNBC Make It.
When she paid off a loan or a bill, she concentrated her payments on the next highest amount. “The snowball ended up being the point where I made massive payments and settled the debt.”
Horrocks, who now owns Instant voice messages, her own voicemail company, says it’s important to track your spending and create a budget. She believes the key to paying off her debt fast was to resolve it.
“I took side jobs, freelance and jostled with the best of them. I used coupons. I sold things that I no longer needed. I learned new skills and didn’t take vacations, go shopping, or live beyond my means, ”she says.
The hard work paid off: “My credit rating used to be nothing nice, but after paying off all that debt, it’s great. I have no problem getting a mortgage now and use great credit cards all the time to earn points and then pay off in full at the end of the month. “
Millennials who want to pay off their debt quickly can take Horrocks’ advice. They can also listen Amber and Danny Masters, which aim to repay $ 600,000 in debt over five years.
“It’s tempting to bury your head in the sand and ignore the weight of your debt,” Danny tells CNBC Make It, “but you really have to look at your situation to get it under control. The sooner you will understand it. , the less painful and more manageable it will be in the end. “
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