How to Aggressively Pay Off Debt Even When You Don’t Make Much Money

Cara Perez, a 29-year-old freelance writer from Austin, Texas, didn’t know what an IRA was until someone brought it up in casual conversation when she was 25.

At this point in her life, Perez had been waiting for the waiting table for several years after she dropped out of school in a recession in 2011 with an English degree and $ 25,000 in student loan debt. She lived with three roommates and worked various odd jobs while trying to become a writer.

About a year later, in June 2014, after minimal debt payments and still living with roommates, “I had a nervous breakdown,” she says. “Nothing in life worked out the way I wanted. I thought, “My God, I have to put this together.”

Perez grew up in a single family that had been using food stamps for several years, and personal finances were not a topic of conversation at the dinner table. But she knew that in order to have the freedom she wanted, she had to get out of her debt obligations. In her opinion, the only way to do this is to aggressively pay for everything. She looked at the web sites and blogs devoted to personal finance, who preached cash minimalist lifestyle, for example, Frugalwoods . The next year “I lived very frugally, I cut everything out,” she says. “No Christmas gifts, no drinks, I gave up travel and tried to go out more, I sold books and clothes.”

She also worked as an MMA gym secretary, caterer and freelance social media writer, among other odd jobs. A year after her financial meltdown, in June 2015, her debt was paid in full – and she did so without any financial help, earning just $ 18,000 in 2014 and $ 32,000 in 2015.

Now, in addition to his freelance work, Perez runs Bravely , a personal finance site for women, contributes to the Fairer Cents podcast, and hosts personal finance events. She wants to help other people achieve their money goals. Here’s how she did it.

How have you dealt with your day-to-day living expenses by persistently paying off your debt?

My expenses were initially pretty low, and I just kept them at that level. I ate leftovers from public catering (in February 2015, I did not buy any groceries, but just ate leftovers to save money), I had three roommates, I stopped going out to eat. It’s about sticking to a plan.

Have you ever missed paying off your debt? How did you get back on track?

No misses. Avoiding debt was more important to me than anything else. I wanted it so badly that I could taste it. I have tried my best to achieve this and I have not had any mistakes. Getting out of debt was more important for me than traveling or eating somewhere. And the remaining debt I had was small enough, and I knew that I could pay it off now , and not stretch it out for years. Why carry around $ 18,000 with you?

Has anyone helped you?

There was no regular financial help, but I had strong emotional support from my friends and boyfriend. (Who am I still with.) I would get $ 100 for Christmas from my Grams and $ 100 for my birthday, so I put that into my debt.

You are really pushing the outside fuss. What odd job did you work in?

MMA Gym Administrator ($ 9 an hour), Catering ($ 12 an hour, up to $ 15 in debt settlement period), Lacrosse Coach (Scholarship), Van Driver ($ 1,500 Scholarship), Social Media Freelance ($ 12 in hour), nonprofit development director (I believe it started at $ 11 an hour in 2014, switched to a monthly stipend in 2015), nanny ($ 15 an hour). I also did completely random things: once I was waiting in line for a guy for $ 100.

What do you say to people who don’t think they have the skills that are in demand?

Take a look at the list of what I’ve done! Ideally, a side job propels you up the career ladder or adds new skills. But if it just brings in extra money, that’s okay too! There is always strange work to be done.

What are your current financial goals?

Short term: Start making the most of my 401 (k). (I have maximized my IRA in the last three years.) Long term: financial independence.

What’s the secret to saving money or pursuing another financial goal?

You must want it more than what is in front of your face. I could do what I did because I was 110% committed and worked on it every day. You don’t have to be as hardcore as I am, but you have to be consistent.

What’s the best money advice you’ve ever received?

Different savings accounts for different financial purposes. Your down payment fund must be different from your contingency fund.

What advice do you have for people with a lot of debt / who don’t know where to start putting their finances in order?

The first step is to always face the numbers. You cannot bring about change if you don’t know the situation. So sit down and look at your situation without judgment. Then figure out what you want to change and make a more detailed plan.


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