I love sharing stories of real people who are taking control of their money, getting out of debt, and on a journey to financial freedom.
So far on the blog we have heard from Ron and Thu Noble and Alex and Megan Barker who have shared how they have paid off their debt.
Today I am pleased to bring you Amy Nickson’s story.
Amy is a single young woman living in Atlanta, Georgia. She openly shares with us the habits and influences that led her to enormous financial stress during one of the saddest periods in her life.
She reveals how she took control to change her financial future and is using her experiences to help others do the same.
Here is the interview:
ME: Thank you so much for agreeing to share your story with Our Debt Free Family! Please tell us a little about yourself so we can get to know you.
Amy: I am Amy Nickson. I am 28-years-old and live in Atlanta, Georgia. I lost my adoring mom two years back and broke up with my ex-boyfriend last year.
ME: I am so sorry to hear that. Did that play a part in why you decided to focus on becoming debt free?
Amy: It was a really hard time for me three years ago. My mom was seriously ill due to liver damage. I wanted to get a better job but didn’t have the opportunity due to my low credit score. I had $88,000 in outstanding debt during that time.
Being absolutely helpless and grieving, I consulted one of my friends, John, who is a personal finance expert. He advised me first to calm down. Then he said, “Megan’s (my mom) medical issues can be resolved by her medical insurance. The rest you can manage from her savings. Your first concern should be your debt.” I was at a point where if I failed to pay my debts, I would become bankrupt.
ME: How much debt did you pay off, and how long did it take you?
Amy: Well, I have paid off $51,000 in the last three years and six months. Now I just have my student loan debt left, which I couldn’t pay off during that time due to some financial hardship.
ME: What kind of debt did you pay off?
Amy: I had four credit cards, a car loan, and a student loan. My biggest blunder was buying a brand new Volkswagen Beetle during my college days.
ME: What did you do for work while you were paying off your debt?
Amy: During that time I had joined a small non-profit company as an assistant account manager. My salary was fair.
My friend convinced me to leave my job to start my own business. I have a small financial consultancy now. It is still growing, and there is lots of work to do.
I love writing so I started blogging. I used to write on a variety of topics, but now I specialize in finance. I am a freelancer and a contributor for the Oak View Law Group. I earn a big part of my bread from there. Recently, I started my own blog as well to establish my expertise in the financial field.
ME: What was your annual income during this time?
Amy: It was approximately $57,000 during my struggling phase. I earned this amount from my job, but my boyfriend at the time was too casual about his career. He was a fickle-minded guy and loved to switch jobs frequently. For this reason, I used to support him.
During that time I started using my cards on a regular basis. We spent lots of money on Starbucks, and the result was a complete financial mess.
ME: I see. Did you do anything to increase your income during that time?
Amy: Well, my mom had medical insurance so her needs were taken care of. I sold my car to pay off the huge car loan. I rented my garage out to a friend to earn some extra money. I did what I had to do.
ME: What sacrifices did you make when you were getting out of debt?
Amy: Once I sold my car, I began using public transit to travel. I put an end to the habit of spending money on Starbucks with my boyfriend. I used to go to movie theaters every weekend. But I felt like these were nothing but bad financial habits that were sucking a lot of my money and leaving me with a long list of credit card bills and nothing else.
ME: So you became more intentional with your spending. What are your top money-saving tips?
Amy: Budgeting, budgeting, and more budgeting.
My mom always did it. And my friend John told me about the benefits of budgeting and taught me how to do it.
Take a piece of paper and note down all of the expenses that you incur on a regular basis. Cut down all your extra expenses that are a total waste of money. This helps you to save some money and make bigger payments to your creditors.
ME: I love that advice! What other advice would you give to someone considering starting their own debt free journey?
Amy: Adopt frugal living habits and saving habits. These are the most effective weapons to kill any debt troubles. You need to be determined and have patience to come back from the financial strain as well.
[bctt tweet=”You need to be determined and have patience to come back from the financial strain. @AmyNickson86″]
I would like to share some frugal tips with those who are facing a similar situation:
- One of the best ways to save is to cut down on your extra expenditures. You need to differentiate between luxuries and your daily needs.
- I made a list of all those items that I would need to buy every week such as groceries and consumer goods. Make sure that you keep your shopping list in your handbag whenever you go to the store. This will help to ensure that you don’t end up buying more things than necessary.
- I believe that excessive use of credit cards is one of the main reasons that people get into trouble with debt. I am no longer a crazy fan of plastics. I have decided to stop using my credit cards altogether, apart from emergency situations.
- Generally, I use cash for little shopping. This actually helps to keep track of your single expenditures. And you can trim extra expenses accordingly.
- I saved a lot of money after disconnecting my land-line in my house! If you are paying for the Internet, then don’t waste money on other prepaid text messaging packages or talk-time offers. Simply download apps to socialize or to stay connected with friends and family.
- I take care when it comes to using my electrical appliances and make sure to keep them turned off when they are not in use. 🙂
- I made it a point to pack a brown bag lunch for myself to take to work every day. My cost of eating out was reduced to zero. I gave up the habit of eating dinner in fancy restaurants on the weekends, as well. When I was racking up my debt, there were so many times that I would pay the restaurant bill by credit card. Alas! This was another big mistake.
- Get help from a professional settlement company if you need it. As per the advice of my friend, I opted for debt settlement. The debt settlement company that I selected actually negotiated with the creditors and collection agencies to reduce my outstanding debts by about 25%.
I admit that it was not easy for me to adjust to a frugal lifestyle. It was especially hard for me to give up buying clothes and accessories that I used to splurge on. But I am glad that by adopting these good habits I have been able to get past my debt troubles and have started living a normal life again.
ME: Thank you for those great insights! Have you made any big purchases with cash since starting your debt free journey?
Amy: Luckily, I already have my house that my mom bought several years ago. Thanks to God Almighty I was able to keep my mom’s hard-earned shelter.
While I haven’t made any big purchases, I am trying to save money to buy a low-maintenance car in the future.
Also, I have a plan to start my postgraduate studies. This will help me to improve my expertise in the area of finance. I will use my degree to facilitate my career through blogging and take up some freelancing work. I think it will take 2-3 years.
In the mean time, I will plan for short and inexpensive trips for refreshment. No big trips at this time.
ME: Thank you for sharing your story with us, Amy! What is the best part about becoming debt free?
Amy: Peace and freedom. I can now sleep peacefully without worrying about creditors’ threatening calls.
And more importantly my credit score has improved since I started dissolving my financial obligations. Thus, I will have more opportunities to apply for new or better jobs or apply for a loan.
Currently, I have only one federal student loan which I am thinking I will pay off with the help of a repayment program. My main goal is to build a solid career so that I can save more money and become rich. 🙂
I want to thank Amy for sharing her story and so many great money-saving tips with our readers. I am inspired by how she took action to improve her situation during one of the toughest periods a person will ever go through — losing a parent.
What About You?
Participate in the conversation. What parts of Amy’s story did you find most inspiring? What tips from Amy can you apply to your life? Share in the comments below.
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