PHOENIX — Jade Warshaw got out of nearly half a million dollars in debt and she shared with 12News how you can too!
"It sounds like an astronomical amount. And it is, but more and more people are going into six figures of debt. This is becoming more and more normal," said Warshaw.
Warshaw is a personal finance expert with Ramsey Solutions. She's the co-host of the Dave Ramsey show.
Warshaw and her husband accumulated $460,000 in debt and more than half of it was in student loans. She said it took them seven and half years to pay it off, and they were able to do it by starting with the snowball method. They paid off their smallest debts first and then kept rolling that money into their next payments.
Budgeting is the key, she said!
"You have to give every dollar an assignment. And for most people getting out of debt, it looks like not only cutting their expenses down, you know, no restaurants, no extra spending, but also in a lot of cases, you need to get your income up and find ways to bring in more income," said Warshaw.
Warshaw also shared that it took commitment to the following things to put their money to work in the correct places. She said think about the side hustles, sacrifice, career shifts and selling you can do.
Warshaw and her husband found ways to bring in extra money with side hustles. They made sacrifices like giving up eating out and also deciding to sell their car and becoming a one car family. They also made career shifts to make sure they were bringing in the most money they could.
While paying off debt can feel like making a lot of sacrifices, she hopes people can look to it as an opportunity and think of it more as a trade.
"You're trading one card for another card, and the card that you're trading for is better, right? Because that card gives you peace. It gives you freedom. It helps you sleep at night. It's not a sacrifice. It's a trade," said Warshaw.
Warshaw and her husband owed $280,000 alone in student debt which is a major topic right now as student loan payments will start becoming due again in October. She wants people to know you are not alone.
"There's 40 million people in student loan debt right now, you are definitely not alone. There's over $1.7 trillion of student loan debt. So you're not in this boat alone. I was there. I know how it feels," said Warshaw.
Student loan have started gaining interest in September after being paused for more than three years due to the pandemic. Those bills will start to be due soon. Warshaw shares that borrowers should make sure they know who their loan provider is, as many loans have been sold to different providers. She said to make sure you know when your bills are due and check your budget to see if you can afford paying them. She said only if you cannot make your month payment each month should you look into payment plans.
"I would only look into a payment plan for the purpose of lowering your minimum so that you're able to pay off your debt using the Debt Snowball Method," said Warshaw.
Ramsey Solutions is hosting a free live stream on September 12th at 5 p.m. Arizona time focusing on student loan debt. You can find more information at www.ramseysolutions.com/debt/student-loan-debt-hub.
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