How I Zerod $25,000 in Credit Card Debt

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Editor’s Note: This story originally appeared on Live on the cheap.

A few years ago, my longtime partner and I were living in his home country of Canada, and I spent a lot of time and money trying to get permanent residency. But sometimes relationships don’t go as planned. I returned to the United States in the spring of 2019 with only a truckload of belongings, my dog, and about $25,000 in credit card debt.

After considering several options, I knew my best bet was to eliminate debt while restarting my freelance business so I could move forward with purpose. So I took what might look like drastic measures to many.

Here’s how I reduced my credit card debt to zero in 2.5 years.

I let go of my possessions

storage units
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I still had a storage unit full of furniture from the house I owned before moving to Canada. I had rented this storage unit for two years, clinging to living room furniture, kitchen utensils and keepsakes. But I couldn’t empty the unit until I had a house. Or could I? I eventually decided that most of these things were a hindrance, keeping me in a monthly payment pattern and adding to the debt column.

I have sold or donated most of the contents of the storage unit. Items of sentimental value were sent to family members. The rest? Just stuff that would slow down my plan for a comfortable life.

Savings: $135 per month

I canceled subscriptions

Middle-aged couple watching TV
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Although I kept my Netflix subscription, I canceled Amazon Prime. YouTube became a fun diversion and I burned through the midnight Kindle, reading dozens of free books that I had never had the chance to read in the past. I also realized that I was paying a self-paying monthly membership fee to a group I no longer attended. Canceling the autopay feature saved me $120 per year.

Savings: $22 per month

I reduced my housing

Man raising his hand to stop buying a house
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I bought an old 13 foot trailer and took it to my son and daughter in law. They opened their arms to me and offered me a place with them for as long as I needed it. I didn’t want to live with my family, overstay my welcome, or become a nuisance – and the idea weighed on me. So we discussed and agreed that it would be a temporary situation. While there I was able to focus on growing my business and started to reduce my credit card balance.

But I also contributed to the housework, by doing the shopping, by preparing the meals and by being available for the grandchildren. Thanks to this, I was able to create a beautiful and lasting friendship with my daughter-in-law and create wonderful memories with my grandchildren.

My family helped repair the old camper; we added electrical outlets, a comfortable mattress, and a hinged table for a workspace. We removed the kitchen and made way for versatile open counters.

Savings: About $1,000 per month

I reduced electricity bills

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Once I was back on the road, I pulled this little RV through state parks and budget campgrounds. I purchased hotspot capability on my phone and chose campsites with strong wifi so I could keep working. My campground costs varied, but were always significantly less than paying for a rental plus utilities. If I was between campgrounds, I cluttered free of charge in businesses that have authorized or taken advantage of dispersed campsite in Bureau of Land Management parks.

Savings: At least $100 per month

I searched for the best credit card offers

Woman shopping online
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Early in my journey, I looked for 0% interest balance transfer offers and moved my balances from high interest accounts to promotional 12 month accounts. Part of my payments had been allocated to interest, so I was able to send the money directly to the principal.

Savings: About $100 per month

I consolidated my debt

Plastic
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When I found the right balance transfer offer, I combined debts from as many accounts as possible to stay below the maximum amount available for balance transfer. This way, I got an interest-free payment.

At first, I couldn’t transfer all my debts to interest-free accounts. I had a few cards with remaining balances. These cards were my first goal: to pay off the accounts that still had interest added to the balance. It didn’t take long to cross these accounts off the list.

Savings: Varied

I paid more than the minimum

Man paying off debt
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Once I saw some wiggle room in the budget by making the changes, I sent every extra dollar to those credit card accounts, always paying more than the minimum and as much as I could manage.

Savings: None immediately, as the savings were used to make payments on the other credit card accounts. But my money was no longer managing me.

I changed my eating habits

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Since I had no kitchen or fridge in the RV, I had to keep my grocery shopping to a minimum. I learned how to cook delicious one-dish meals on a butane stove and boil water for French-pressed coffee. I ate a lot of nuts and berries during this time!

I discovered that I didn’t crave fancy meals. I ate healthy and had never been hungry. My own grocery bill was a fraction of the cost of my dog’s food and care. Note: My beloved dog was never put on a special debt-free plan. Her needs were a priority, and we had regular visits to the vet and bought the food she used to eat.

Savings: About $300 per month

I took advantage of the available work

Young woman working on laptop in office
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When a family member offered me his cabin in Ontario, Canada as a potential temporary parking spot, I again crossed the border into Canada. Then the world changed in the spring of 2020.

My temporary situation turned into a gathering place, and with a still valid work permit in hand, I decided to look for work as an essential worker until my permit expired and the opening borders to returnees. Although my business slowed down for a while, it never completely stopped. I built new relationships with clients and colleagues.

Savings: It’s hard to say. I was ready to get off the road at that point. Here I could live in over 100 square feet of space and have time off the road.

The end of the story

debt free
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I returned to the US in May 2021 with a fraction of the $25,000 of original debt remaining, all in a 0% balance transfer account. I sold the motorhome and used the proceeds to rent an apartment and start over. Although my monthly expenses were higher, I continued to focus on paying off that credit card debt by sticking to a tight budget, working as long and as often as possible, and keeping track of every expense. In November 2021, I sent the last payment.

I was debt free! I paid $25,000 from June 2019 to November 2021, for a total of 29 months.

Letting go of ownership, place, and any pride that got in the way of my progress helped me remember what’s really important. Relatives helped me through the transition and supported me in my goals. It’s never priced for me.

Today, my goals are different. I am ready again for a home base and for different adventures. I stay on a frugal monthly budget. The lights are off when I don’t need them, and I use smart power strips and energy-saving bulbs. Food is never wasted.

Although your background is different from mine, you can apply some of the same ideas to your own financial goals. Sure, your changes may or may not be so extreme, but each step is monumental on the journey to financial freedom.

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