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I am determined to have a financially successful new year, so I decided that I was going to work on paying off my car loan. This journey to financial freedom has definitely been tough, but I am determined to get rid of as much debt as I possibly can. I want to free myself from a day job, but before I do, I have to lower as many expenses and I have to improve my cash flow. So, I paid $1,000 more on my car principal (still amazed I could do this), this will get the ball rolling for me to pay off my car by the end of this year. If I just make the minimum payment on my car note, I would pay off my car in the next 3 years, but since I have dreams of owning my own business very soon, I want to go ahead and get rid of this debt now.
I have been following the “snow ball method” of paying off debt. I wrote down all of my debt balances, and I am going to attack the smallest balance first. I took $1,000 from my savings and applied it towards my principal on top of my monthly payment this past January (yayyy!). I also took the initiative to create a plan on how I would improve my cash flow so that I can pay off my debt and it is as follows:
How I plan on paying off my $10,000 car loan this year:
- Stop contributing to my 401K to have extra cash flow to pay off my car loan
- Start cooking and eating at home during the week.
- Cut out all unnecessary spending such as nail salon, hair salon.
- Looking for a new job that pays more.
- Starting a side hustle.
While these are definitely big life changes for me, especially not contributing to my 401K, I am committed that make these small changes that will help me in the long run. I plan on paying off my car and driving it until I pay off a generous portion of my student loans as well! I hope that this encourages you to work on paying off your debt to recognize that you are not alone in your journey! My first recommendations are to find some inspiration and mine were listening to the Dave Ramsey Podcast and hearing all the “debt free screams”, also the fact that I want to free myself from a day job!! Another motivation is that I want to have kids and I want to set a good example for them! Overall, I hope that this inspires you to not give up the faith and realize that in the end, getting rid of more debt will all be so worth it!