- Eric Hu
From living in vans to using simple credit card tricks, everyday people have gotten incredibly creative to eliminate their debt.
If you’re looking for an alternative to the more conventional path to get out of debt – or are trying to accelerate your repayment track – you have options.
Consider the strategies of these eight people who paid their way out of the red, creatively and quickly.
- Anna Newell Jones
Anna Newell Jones went on a ‘spending fast’
In 2009, Anna Newell Jones was deep in debt – $23,605 – thanks to credit cards, student loans, and a personal loan from her parents for college tuition and expenses.
Eager to be debt-free, Newell Jones took drastic measures: She went on a year-long spending fast. “A spending fast is where you spend money on the basics needed to live. It’s created by structuring a wants and needs list, which is personalized by each specific person’s priorities in life,” she explained to Business Insider.
She spelled out her needs – rent, utilities, cell phone without internet, necessary groceries, low-cost gym membership, medical costs, inexpensive photography exhibits for her side business, car payments and gas, a bus pass, and boxed hair dye – and eliminated pretty much everything else.
Fifteen months later, she had wiped out every cent of debt.
Jason Roesslein lived out of a van for 5 months to cut housing costs
Tesla engineer Jason Roesslein lived in his “studio on wheels” – a 2006 Dodge Sprinter van – from October 2014 through March 2015, using Tesla and his gym to shower and eat most of his meals.
After five months of van life, he reverted back to a more traditional lifestyle with nearly $10,000 in extra savings, some of which he diverted toward paying off his student loans in full.
Devin Elders adopted a simple mantra
Devin Elders, who paid off $110,000 in two years, looked for every opportunity to put money toward his debt instead of spending it.
“Part of the Elders’ extreme savings plan involved brutally cutting every corner possible. Elder said his mantra became ‘Is there a free alternative?’ Every time he could have spent money on something, he would ask himself that question and almost always come up with an answer.
“For example, when he needed a ladder to paint his house, he borrowed one from a neighbor. When he and his wife wanted to go to the movies, they watched one online. And, they went to the park for picnic dates and had friends over for happy hour. When asked if he ever splurged, Elder laughed and said, ‘No. It sounds cheap, but it worked.'”
Eric Hu holds multiple side jobs to pay his NYU tuition as he goes
Long Island native Eric Hu paid his $48,280 freshman tuition bill by the beginning of his sophomore year – and he’s on track to do the same for his remaining time at NYU in order to escape student loans.
The 20-year-old media culture and communications major did it through a variety of strategies, such as taking advantage of about $13,000 of scholarships, working multiple jobs, and following a clear financial plan.
Ken Ilgunas secretly lived in a van
After graduating from the University of Buffalo in 2005, Ken Ilgunas had $32,000 of student debt. He moved to Alaska and spent two years paying back every dime by working odd jobs that provided housing and food, meaning he was able to save nearly all of his $9-an-hour salary.
When he enrolled at Duke University for graduate school, he was determined not to make the same financial mistakes, so he turned a van that he bought for $1,500 into a mini dorm room and secretly lived in a parking lot off-campus. It paid off – he graduated in May 2011 completely debt-free.
- Adrienne Dorison
Adrienne Dorison started a side hustle
Adrienne Dorison graduated with a degree from the University of Georgia and a tab for nearly $50,000. In order to fast-track her 25-year repayment plan, she made short-term sacrifices such as getting a roommate, switching cell phone providers, cutting travel, and pressing pause on her 401(k) investments – but she also focused on earning.
“I realized that I could only cut my expenses so much,” she writes. “Increasing my income would be a critical part of gaining freedom from debt. So as a side gig, I took a skill set that I was using in my corporate role – streamlining projects to save money and time, and get better results – and used it to show entrepreneurs how to run their businesses more efficiently.”
Cutting costs and increasing income allowed her t0 pay off $48,000 in just six months.
- Kim Parr
Kim and Jim Parr used a simple credit card trick
Kim and Jim Parr paid off $30,000 of consumer debt in less than two years, with help from a simple credit card trick: After paying half of their debt, they made a 0% balance transfer, which allowed them to pay the remaining $15,000 without incurring any interest.
A balance transfer is when you roll over your debts from one credit card to another. “Usually there is a one-time transfer fee associated with this move, which is generally a percentage of the amount of money you’re actually transferring over,” explains Cheryl Lock on Magnify Money. “The best way to get the most out of a balance transfer is when you can move debts from a high-interest interest card to a low or no interest one.”
While the Parrs note that balance transfers aren’t for everyone – 0% interest is usually an introductory rate, and if you don’t have that balance paid off by the time the rate expires, you could get hit with massive interest – they had 12 months to pay off the balance before the interest kicked in, “and I knew that unless there was a catastrophe, we’d be able to pay it off,” they explained to Business Insider.
- Courtesy of Joel Weber
Joel Weber traded expensive dorms for a 145-square-foot tiny home he built himself
Joel Weber took one look at the cost of residence halls at the University of Texas at Austin (about $1,135 per month) and knew dorm life wasn’t for him.
To save on student housing, the design major spent a year constructing a tiny house in a friend’s backyard for less than $15,000. He had to empty his savings and emergency fund to make it happen – which he admits was a risk – but he now pays nothing in rent and plans to graduate debt-free.