This guest post from Jeff is part of the “reader stories” feature at Get Rich Slowly. Some stories contain general advice; others are examples of how a GRS reader achieved financial success — or failure. These stories feature folks from all levels of financial maturity and with all sorts of incomes. You can read more from Jeff at Sustainable Life Blog.

After making New Year’s resolutions while an undergraduate (at least two years in a row) to pay off my credit card debt and failing (miserably, I might add), I decided that when I went to grad school I’d get serious about it and finally get my credit cards paid off.

I was able to pay one off relatively quickly, but the other three remained rather stubborn and never seemed to go down. Finally, I figured that because I had been trying for the better part of three years to pay off my credit cards and wasn’t really getting any traction, I’d turn to the internet to see if I could find people in similar situations or with strategies that worked better than mine. It wasn’t long at all before I got sucked into the black hole of personal finance blogs like Get Rich Slowly and The Simple Dollar.

I decided that this was something I wanted to do. I had some great tips from PF blogs, and as luck would have it, I was just about to finish up my masters degree. I paid minimums on my debt and stocked up on cash because I didn’t know what was next, and I figured that once I got a “real” job, I could pay down my debt rather quickly.

J.D.’s note to college students: I also told myself this in undergrad. It seemed like it wouldn’t be hard to pay down debt when I had a “real” job and making money. Now that I’ve paid my debt off, I can tell you that’s not true. Your future self would tell you that paying off the fun you had in college sucks.

To illustrate my story, here’s a graph of the major points on my road to debt elimination. I’ll refer to each point in the story that follows.

Jeff's debt, graphed.
Jeff’s debt graph. This article will explain each numbered point.

Making Progress
It took a while to get situated into my new home and city, and that ate up much of the savings and a few of my first paychecks. I was still paying slightly more than the minimum on my debt, living like a college student, and making more than I ever had. After two months, I was able to make my first large payment (graphed point #1) and it felt great! I finally got some traction, and was on the way to paying off my credit card debt.

At this point, I was more than excited, and started forecasting the day when I’d have my credit card balance at $0 for the first time in about seven years. I figured 01 January 2010 was a goal that I could reach, still challenge myself, and I thought it was a nice way to start a new decade. Then came the car trouble.

I had little cash in savings when car problems started popping up left, right, and center. I bought a beater car to get me to work. I put it on a credit card because I felt I had no choice because I needed to get to work (graphed point #2). I kept my old car, with the intentions of fixing it and selling the one I had more recently purchased once my old one was fixed. While this plan was basically fool-proof in my head, it backfired in spectacular fashion. Once I cleaned up that mess (that I made) I was able to make another large payment to my credit card debt for two months (graphed point #3) in a row and I was back in the game!

That didn’t last too long, as my old car finally became more trouble than it was worth and gave up on me. Due to my job, I needed a car, and I needed one quickly. I had money earmarked for credit card payment that month, but instead it went to a down payment on a car. I paid the down payment with all the cash I had, and then got a nice lesson on purchasing a car in the state where I live.

In most states, the dealer pays the sales tax for you and rolls it into your loan. Not here. They handed me a receipt for the purchase price of the car and the percentage of sales tax charged by my county. I thought I was in the clear, but just like that I was staring down a $2,000 tax bill. Since I’d used all my cash savings for the down payment, I didn’t have the resources to pay for it, but after making big payments on my credit card for the previous two months, I had room on the card. I headed over to the county clerk and paid my sales tax with a credit card (graphed point #4).

Missing My Goal
January 2010 arrived. I had hoped to have repaid my credit cards by that date, but the debt-free train came to the station and left without me. I had a debt level only slightly lower than what I started with! I decided it was time to stop messing around. I wasn’t going to have any more car problems (I had a warranty!), and it was time to get serious about knocking down this credit card debt.

Oh, but wait! I couldn’t pay as much as I would have liked because my student loan payments were coming due. I cut even more out of the budget, including the cable TV, pared the budget to the bone, and got down to business. I was able to cut my credit card debt down by more than half in just two months (graphed point #5). I was finally seeing results, and it felt good!

To continue with the theme of this story, I made a small mistake and paid one of my bills twice, which threw my finances out of whack all month and I didn’t make any progress (graphed point #6). No matter: I paid more than half of what I had left and kept my head down during the month of June, and paid the last of it at the beginning of July (graphed point #7).

It’s a great feeling not having any credit card debt. To those of you wanting to be at $0 on your credit card debt, keep your head down and stay focused. Your day will come.

Lessons Learned
Here are some things I learned while paying off my debt:

  • Life is going to get in the way of your best laid plans. Yes, my own stupidity was probably the biggest roadblock to my success, but other things contributed as well. You have to be like a bop bag in that when something punches you down, you just bounce back up.
  • You have to want it. You cant just sort of wish that you could pay them all off, you have to make it a priority. Nothing’s going to happen if you don’t change your actions/spending.
  • You can’t quit. Perseverance is key to just about anything in life, including debt repayment. Find a group of people that are where you want to be, and copy their methods, or adapt them to your situation. I think if I wouldn’t have been reading PF blogs and listening to other people who have eliminated debt and all the freedom they enjoy, this quest to kill my credit card debt may have been as feeble as my previous attempts.
  • Don’t forget what success tastes like. One of the things that kept me going in the early months of my repayment was the success that I hit at point one on my graph. Man did it feel great! And it kept the juice flowing during the times where progress was small or non-existent.
  • Personal Finance is a life long journey. Keep your head in the game the whole time and your eyes on your goals, and you’ll be just fine.
Reminder: This is a story from one of your fellow readers. Please be nice. After more than 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. Henceforth, unduly nasty comments on readers stories will be removed or edited.