California mom reveals how she paid off $72,000 in credit card and college loan debt
A 36-year-old mom has revealed how she paid off $72,000 in debt by following just three simple tips.
Amanda Courtney, from San Diego, California, paid off all of her student loans and credit card charges after she fell into a mountain of debt due to a lack of knowledge and a ‘false sense of security’ when it came to finances.
From creating a budget that works for you to consolidating your loans, the mom-of-one detailed how she finally freed herself from her large amount of debt after eight years.
Amanda Courtney, from San Diego, California, has paid off all of her student loans and credit card charges after she fell into a mountain of debt
The first thing Amanda did when she decided to take control of her expenses was ‘be honest’ with herself.
The San Diego mom explained that she was ‘adding’ to her balance because she ‘didn’t have the financial literacy to understand’ the ‘full implications’ of what she was doing.
Speaking to Good Morning America, Amanda explained that she came from a family that never discussed budgeting or finances, which created a ‘false sense of security’ that she would be able to pay everything off easily.
‘Then reality hits you and you realize that’s not how any of this works and my $15,000 in loans very quickly becomes $30,000,’ she explained.
You don’t have to give it all up! Create a budget system that works for your lifestyle and allows you to celebrate
Amanda began by pulling all of her credit card statements and all of her student loan balances to help her truly understand where she was at and make a plan that worked for her life.
The 36-year-old mom has revealed how she paid off more than $70,000 in debt by following just three simple tips
When she began dating her now-husband, she realized not everyone faced similar debt issues and began having serious discussions about her finances.
With the help of her husband and setting a strict plan into motion, the mom spent eight years paying off $50,000 in student loan debt and $12,000 in credit card debt.
Amanda made her final student loan payment in September 2021.
She explained to GMA that it took her a significant amount of time because she made sure to allow herself to still live her life and budget.
‘It took that long because I did it while still living my life. We built things into the budget so I felt this freedom to still live my life,’ Amanda explained.
Amanda began a zero-balance budget, which saw her directing every dollar from her paycheck to a specific area.
Amanda began a zero-balance budget, which saw her directing every dollar from her paycheck to a specific area (stock image)
She explained that she would thoroughly examine her paycheck and rebuild her budget every month.
‘I was honest with myself, and I made a plan, but I made a realistic plan,’ Amanda said.
‘You have to allow yourself to go to that lunch celebration with friends. You have to allow yourself to buy yourself a new top every now and again.’
The 36-year-old loves to travel so she created a special travel saving account that she allocated a small portion of money into each month and if she didn’t have enough money saved up, she wouldn’t go on a trip.
One step at a time! Consolidate your loans to help make the payment process easier
When Amanda applied to college she knew she had to take out student loans and began by taking $15,000 in loans in her freshman year alone.
When Amanda applied to college she knew she had to take out student loans and began by taking $15,000 in loans in her freshman year alone
Over the next few years she attempted to lower her student loan debt by moving back in with her parents and transferring to a community college.
She told GMA that when she graduated in 2008, the country was in the midst of a financial crisis and she struggled to find a job.
‘I continued to enroll in school just so I could defer my student loans because I couldn’t afford to make the minimum payments, all while continuing to accrue more credit card debt. And I just fell deeper and deeper into debt,’ Amanda said.
When she was 25, Amanda got a job in education that helped her make minimum payments to her debt each month.
She soon realized that although she had put off making payments by continuing to enroll in low-cost community college courses, the interest on her debt continued to soar because she had to get a loan through a private company since federal grants didn’t cover the total amount, meaning that she dealt with an ‘insane interest rate.’
After beginning her debt-paying journey, Amanda consolidated her loans by using online finance company SoFi, which she said was ‘so freeing.’
Make a plan! Cut out your credit cards by planning for major events instead of swiping
Without any knowledge about how to budget or make payments, Amanda got a credit card at age 18 and quickly piled on even more debt (stock image)
Without any knowledge about how to budget or make payments, Amanda got a credit card at age 18 and quickly piled on even more debt.
One of the biggest keys in freeing herself from debt was cutting out credit cards.
Amanda did this by planning ahead for events such as birthdays, holidays, and vacations, so that she wouldn’t have to charge her credit cards.
She explained that in the past she would just swipe her credit card while shopping and counted vacations as ’emergencies,’ which would further put her in debt.
Amanda began by pulling all of her credit card statements and all of her student loan balances to help her make a plan that worked for her and her family
‘Whereas I always wanted to treat the holidays as an emergency and put it on my credit card and just make it rain in various stores, all of a sudden it was like, “Oh, I should be putting away money every month to get there and then look at what I have at the end of the year and look at what I can afford to do for people,”‘ she said.
Since she loves giving gifts during the holidays, she thought of a way to do it within her budget plan.
Amanda added that when she first put this debt payoff plan in place, she made all of her Christmas presents for her friends and family.
When she first began to cut out credit cards, she prioritized paying off the credit card with the smallest total balance while still making minimum payments to the others.
Paying off one credit card would give her the strength and motivation to continue with her plan.