The D Word: Hannah and DEBT are DONE!

Budgeting and Debt

Jun 27

The D Word: Hannah and DEBT are DONE!

UPDATED POST: This post is from 2014, when Hannah finally cleared her debts and was able to begin saving up for our travels in Australia. In 2016 we remain debt-free nomads!

YAY!! No other word so majestically describes the feeling of finally being debt-free.

I did mention in a previous post that June would be a big month for me as I would finally clear my debts; debts in the form of a student overdraft and a credit card.

So here it is, June 2014, and I have paid everything off. I am now debt-free!

I feel like all the big 'D' words are always bad things that people don't like talking about i.e. Divorce, Death, Dentists.

I suppose not everyone likes to air their financial laundry in public but I am an open book; and I write a travel blog about minimalism and living a fulfilling life on a small budget. I have to be a good example to all our readers of course. Which is why I wanted to share this milestone, to inspire and enthuse everyone else, who is trying to eradicate their debts.

Clearing debts is not so easy for the likes of us who are self-employed or part-time employed, as it might be for people earning the big bucks.

But it's probably just as difficult for those on a hundred grand a year as it is for those on ten grand!

Why? Because we generally adjust our lifestyle to our income, and plenty of people become quite accustomed to a life of luxury when it becomes affordable; sometimes wealthier people who feel more financially secure and actually accrue a lot of debt (despite a high income) in order to go for the bigger, better, more expensive; the house, the car, the holiday, the new kitchen extension.

But I doubt these people are the same whom might be wanting to ditch material possessions, escape the trappings of 9-5 society and go all nomadic.

Maybe they are! Who am I to generalize, we can all become tired and disenchanted by our lives and want to enact big change.

Either way, I am proof, that despite living on a low and unpredictable income (my tax return for that period showed that one month I earned £1000, the next only £500, all whilst paying out £100's on fuel) I still got myself out of debt in the space of 7 months.

7 months, it really has gone by so fast.

I so clearly remember envisioning this time; it seemed so far away but so exhilarating, because I was determined, and I knew I was going to get here, with time and pressure. Not to say I haven't slipped up, because I certainly have.

On one occasion I went to my local town to buy 'a couple of new tops' and spent way more than I had intended. I am not perfect but I have still come along way.

My top three realistic suggestions for debt clearing:

1. Always Question.

When you are in a shop, holding something, weighing up buying it, is it a NEED or a WANT; is it something that will be useful and that will last?

Is it worth the expenditure when that money could be elsewhere clearing debts quicker?

If the answer is YES, then to maintain balance you'd need to spend less in the coming days/weeks after making the purchase.

Is this sacrifice now, worth further sacrifices later?

Is the item going to bring instant gratification or long-term satisfaction?

People waste their cash and then don't repay their debts as fast as they'd like, when they consistently spend money on random and useless stuff.

Buying a good-quality pair of trainers is not a spending sin, but buying a new pair each week? Buying duplicates of things simply because you enjoy the new and trendy?

There is no room for excess and luxury when it comes to debt clearing!

2. Don't let disposable funds sit in your current account or wallet.

A sure-fire way to accidentally (on purpose) spend your cash is if you leave it sitting there in your wallet or debt account, tempting you with it's come-hither papery pull.

I always move my funds away, either straight toward my debts, bills, or into a savings account which isn't linked to my debit card, so that I can't waste that money on day-to-day life.

If I am using a cash method (leaving debit cards at home) that week to pay for my groceries, I will resolve that I can't then touch my debit card to pay for food.

If I frivolously blow this cash, I also then can't eat for a week...the way I organize my money has actual painful consequences, so I manage it more strictly.

I move funds for each bill into a specific bank account and I do the same with spare cash, but I usually just send it into the black hole of debt straight away and then I can't feel the loss of that money too acutely.

When I would get a large influx of cash, say, when a customer pays an invoice, if I can spare that money and if it isn't required for bills, I don't then view that as play money, instead I send it straight to the debt!

I believe extra cash influxes aren't truly yours to enjoy whilst debts linger over your shoulders.

3. Always look for the best deals.

When I do my weekly food-shop I always buy the cheaper version of what I need.

I do try to buy healthily and organic where possible, but I will help my bill with buying the cheapest meal staples plus buying frozen fruits and veg.

I always take a list to the shop with me, which is based on a meal-plan I would have designed the previous night.

I account for snacks and a few treats also within my meal plan. If you have nothing in the house to eat, the temptation to head and out spend outside your budget will be your undoing!

I also always write on my list what I already have at home to prevent extra wasteful spending.

Other ways to maximize debt repayments:

So here I am.

I have reached this pivotal moment when I can enjoy the relief and bask in the fruits of my labours. Now, I get to watch my savings mount up, knowing each earned penny is all going toward an awesome, life-affirming travel adventure. My money is now going to work for my goals and my dreams, as opposed to making me feel enslaved by its pull and the push to consume mindlessly.

Of course I'm not yet rich, I am merely unburdened by debt, and I won't get too far travelling on a couple grand, but I will get to Australia with my gorgeous partner within a few months, and that makes all the sacrifices feel so justified.

Thanks for reading!

Hannah and Taran here. We hail from Southern England, where we met online and are now realizing our mutual passion for travel here at Nomad'erHowFar. We discuss Nomadic Living, Simplifying your Life and Long-term Travel, to empower, motivate and inspire our readers. Get to know us here!

Get social and follow us across the web!