This guest post from Rita marks the start of a new feature here at Get Rich Slowly. Every Sunday will include a reader story (in the new “reader story” category). Some will be general “how I did X” stories, but most will be like this: An example of how a GRS reader achieved financial success.

I discovered Get Rich Slowly from a link on MSN Money in the fall of 2008. I’d just purchased a home with my husband and I was in a lot of debt (we keep separate finances for reasons of convenience). I’m not the type of person to feel hopeless or sorry for myself. I realized that I had only myself to blame for my situation and I really wanted to turn things around.

The best thing I ever did
The single best thing I ever did for myself was create an excel spreadsheet which added up the debt that I owed. I’d never taken a look at my “number” before and, oddly enough, it made me feel better knowing that I was getting organized. I then created a list of my monthly fixed expenses and a paycheck-by-paycheck spending plan (I don’t like the word “budget” because it sounds too restricting). Whatever I had left over each paycheck was my debt snowball.

My situation was relatively simple: I made a nice salary and I had money left over each paycheck because I had already optimized my auto insurance, cell phone bill, gym membership, etc. After looking at past bank statements and credit card bills, I realized that I wasn’t spending money on clothes, video games, etc. but I was spending way too much on experiences (trips, dining out, concerts, etc). Understanding my spending habits helped me plan for debt elimination.

In order to start my emergency fund before paying off my debt, but I failed at this numerous times. I have always been a little bit of a risk-taker, so I decided that I had a large enough cash flow to just pay for unexpected expenses out of my debt snowball if needed. I was also in debt elimination mode so I felt like that money would be better spent on my debt. I wouldn’t necessarily recommend this method, because I do think it is better to build a small savings; however, I was just coming out of a period of bad spending habits and I didn’t trust myself not to spend the money that I had in savings.

Some would say that I should have put my fun money toward my debt instead of spending it, but I believe that having that extra money to spend on whatever I wanted was what made me succeed in paying off my debt so quickly. When I started my debt payoff, I cut up all of my credit cards (and left the accounts open) and just used the fun money in my bank account to spend freely. I know I would have paid off my debt sooner had I not spent this money, but I was a much happier person for having it.

Life after debt 
Now that my debt is paid off, I have a new spending plan which allocates a large portion of what was previously my debt snowball to a Roth IRA and an HSBC Direct online savings account (my emergency fund). Funds are allocated to my accounts through direct deposit each paycheck so that I can’t mess with them. Once my online savings account has reached my goal, I’ll begin allocating funds to a few other online savings accounts (one for vacations, one for a car, and one for irregular expenses).

I’m now able to keep my needs at 50% and allocate 20% to my wants and 30% to my savings (I am maxing out my Roth IRA and building an emergency fund). My goals for the future include paying cash for my next car, building a $20K emergency fund, and paying off my federal student loans.

Thanks so very much for creating such a useful and inspiring blog. I will continue to be an avid reader and forward your posts to my friends.

Reminder: This is a story from one of your fellow readers. Please be nice. After nearly a decade of blogging, I have a thick skin, but it can be scary to put your story out in public for the first time. Remember that this guest author isn’t a professional writer, and is just learning about money like you are.

GRS is committed to helping our readers save and achieve their financial goals. Savings interest rates may be low, but that is all the more reason to shop for the best rate. Find the highest savings interest rates and CD rates from Synchrony Bank, Ally Bank, and more.