Tuesday, November 16, 2010

How I Wiped Out a $33,000 Debt in Under 1 Year!

I entered University in 2001 with $2,500 in the bank with no Educational Fund.  Forward to 2008, a bachelors and masters degree later and a bill for $33,000 in student loans. 

I was very lucky to have landed a full-time job before graduation, my dream job actually (read: Vancouver 2010 Olympics!).  This was an 18-month contract, and I knew that I wanted to have this student loan off my back before the contract ended.  I set myself a lofty goal of 1 year....eek, that's $2,750/month not factoring interest.  "Okay, I can do it".

Here's how I ditched the debt (including interest):
1) I paid a minimum of $1700 per month onto my debt = $22,400
2) I applied my tax refund onto my debt = $5,400
3) I sold my car = $1,800
4) I put every per diem cheque from work onto my debt = $7,000
5) I put every birthday/christmas money onto my debt = $600

I was fortunate enough have a parent who let me live rent-free while I was paying down my debt. I was fortunate enough to have a job that provided me with a vehicle, so I was able to sell the car I'd had since high school.  My job paid us $60/day per diems, and since we'd generally be too busy to eat we usually netted at least $35/pay.  More than 200 days on the road sure adds up.

It wasn't easy, but I was able to pay off my loan in 10 months, 2 months shy of my goal!

What has been your greatest financial achievement?


  1. That is fantastic! Congrats.

    Mine was clearing $60k in 18 months, very similar to your goal :)

    I ended up traveling to every city I could on a project and just staying there, which allowed me to go with one suitcase and give up my apartment.

  2. Incredible! That is an amazing story. I'm really impressed with your dedication. So many people (myself included) don't think about paying off their loans that quickly and we get stuck paying loads of interest. Your story is really encouraging and a great model for the rest of us.

  3. Thank you for sharing. You just go to show, that if you want to do something strong enough -you can. Great Job!

  4. That's fantastic! Congratulations! We've been digging our way out of a mountain of debt for awhile now. We once managed to pay down $24,000 of debt in 6 months, but we found that level was a strain on our family, so we loosened up. But $33,000 in 10 months is a great acomplishment. You should be proud of yourself!

  5. Wow! Amazing! Congrats! :) It's very impressive! You must have been very very strict on your budget! You should be soooo proud of yourself for your accomplishment! :)

  6. Thanks so much for the positive comments!

    I'm trying to stick with the aggressive savings plan for the house fund, but after taking a $15,000 pay cut from the last contract to this one my total savings per month is lower. It's tough some months to make the $1,300 savings goal.

    Reading all of the PF blogs out there are incredibly inspiring as well.

  7. That's fantastic!! That is an amazing feat!

    I think it really helps when one does it "automatically" before you have a chance to decide what to do with the money.

    That's cool you got to work for the Olympics (being a fellow Vancouverite- I loved the atmosphere last Feb!) and even cooler you got a per diem. Oh how I wish my job paid me extra for food allowance!