How this YouTube creator paid off his debt
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Aja Dang isn’t shy about talking about her $ 200,000 debt repayment trip. In fact, chronicling her monthly budget and progress along the way to her 450,000+ YouTube subscribers That’s what helped her pay off her six-figure debt in just two years.
After years of ignoring her debt, Dang decided in November 2017 that it was finally time to take care of it when she couldn’t afford surgery to help her sick dog.
Dang’s indebtedness included the outstanding credit card balances, a car loan, and undergraduate and graduate student loans that made up most of the $ 200,000. Once Dang realized she wanted to pay off her debt, she immediately tackled the small items. She paid off her credit card balances overnight, which she estimates to be around $ 1,200, and paid off her car in February 2018. The rest of the time was spent. pay off student loans.
As Dang’s journey to pay off her student loan debt accelerated thanks to the significant income she earned as she gained ground as a social media influencer, she has an idea that can be applied to anyone trying to tackle their debt.
Below, Dang shares with CNBC Select her number one rule for paying off debt, plus three tips for getting rid of debt.
Dang’s # 1 rule when paying off your debt
Whether you have a short or long debt repayment road ahead of you, Dang’s number one rule is to find your community.
“Paying off debt is really, really hard and can be isolating, but there are a lot of people going through it,†Dang told CNBC Select. “If it hadn’t been for my YouTube community, I would have given up.”
Although Dang started his YouTube channel filming more lifestyle content, it was a Video from December 2017 where she revealed her significant student loan debt which caught the attention of many viewers. She received comments such as “Feel your pain on student loans“, “I also didn’t know what I was signing up for when I signed up for undergraduate student loans either” and “Someone finally discuss it on YouTube! “
These comments helped her realize that many people could understand her situation and prompted her to document how she was going to repay her loans.
Paying off debt will likely involve cutting back on things like traveling or having dinner with friends, so being able to talk to other people who understand what you’re going through is helpful. “Be surrounded by a community of people who can continue to encourage you and remind you of how far you’ve come,†says Dang.
You don’t have to go far or pay a lot to find help. Online personal finance groups like Bravely and the Financial Cents Facebook Group are free and help you find others in the same boat.
Tip 1: budget and track everything
Dang still has a budget now that she is out of debt. She details the details on his YouTube channel.
“When I started out, I didn’t really understand how much I was really spending on stuff,†Dang says. “You really can’t commit to paying off your debt if you don’t know where your money is going. “
To begin with, Dang first read Dave Ramsey’s “The Total Money Makeover†after a friend suggested it.
Feeling motivated, she then created an Excel spreadsheet to serve as a budget template. The spreadsheet included a monthly summary of things like his income, expenses, and student loan debt. When Dang started, she went through four months of bank statements and divided everything she spent her money on into separate sections, such as food (restaurants, groceries, delivery), her dog, and her living expenses. She then calculated how much she was spending on average in each category per month and created spending targets to reduce her spending and direct those savings to her student loans.
Learn more: How to create a budget in 5 steps
Beyond his monthly budget spreadsheets, Dang has tracked his daily expenses through personal finance mobile apps like Capital city, as well as in an agenda. Each night she made a routine of writing down her daily expenses for that day. It helped her visually see how much money she had spent and on what. It also helped her understand her needs versus her wants. She learned to cut back on all the expenses that she was constantly making that she could easily get rid of, such as food delivery from Postmates.
Tip 2: try one or two side activities
Before Dang became big enough on YouTube, generating the majority of her income through branded deals, her debt repayment plan included a side scramble in her spare time.
She’s done everything from dog sitting to dog walking to Rover.com, selling clothes and beauty products on Poshmark and random tasks through TaskRabbit, such as assistant work, video editing and audio transcription.
The side hustle is a good way to supplement your income so that you can significantly reduce your debt.
When choosing the right side for you, first decide how much extra time you have. Then think of things that you like. For example, if you like to organize and clean, you can organize and clean people’s homes or closets. If you like to fix things up, buy from thrift stores to make new and resell. Examining the on-demand apps you already use on your phone can help you come up with ideas for side activities or gig-type work.
Learn more: 5 easy ways to earn extra cash from your couch
Tip 3: Treat yourself
Dang didn’t want to commit to not spending money on things that made her happy. “I tried and almost gave up,†she says. So she decided to reward herself throughout her debt repayment journey.
Whether it’s a nice dinner or a self-care manicure / pedicure, Dang has found success in these mini treats. They motivated her to keep paying off her debt until she reached the grand finale goal.
Saving for these little rewards helped her emotionally and kept her excited about reaching her bigger goals, she says.
As long as the expense doesn’t keep you from paying off your debt, it’s worth indulging yourself. To help you save for those little rewards along the way, create a separate savings fund and schedule a small automatic transfer every month so you don’t even have to think about it.
A high yield savings account can help you reach those small goals faster. The Ally Online Savings Account allows users to categorize their savings goals through its Smart savings tools called “Buckets.”
At the end of the line
Dang’s influence income from his branded sponsorship deals played a big role in paying off his 6-figure debt in such a short time. Along the way, however, the tips outlined above have helped her and can apply to anyone trying to get rid of their own debt. Focus on generating more income with the skills and resources you have. Then cut the budget and find ways to stay motivated that work for you.
It doesn’t matter if it takes you two years or 10 years (or even longer), the goal is to establish good debt repayment habits, like finding a community, budgeting, tracking your spending, getting by and getting along. to please, it can help you progress.
Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.
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