7 Secrets From People Who’ve Paid Off a Collective $231,000 Worth of Debt

A woman sits with her phone and dog.
Nancy Frost used a cash-back app to save and make money when she shops. Matt Roth for The Penny Hoarder
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Let’s be frank: Debt sucks.

Whether you’re struggling to pay off student loans, high-interest credit cards, an unexpected medical bill or all the above, it’s easy to get trapped in the doom and gloom of owing money.

Are you supposed to live off ramen the rest of your life? Never take a vacation? Work until you’re 90?


We have stories from real people who’ve managed to pay off a collective $231,000 without making any drastic lifestyle changes. Use their secrets to help you become debt free.

Secret No. 1: Don’t Settle — See if You Can Lower Your Monthly Payments

When it comes to debt, it’s easy to fall into the “it is what it is” mindset. Too late to do anything now… just have to try to keep up with those monthly payments, right?

Wrong. You can look into saving money on your debt — or paying it off even faster — by refinancing it with a personal loan.

Now you might think this sounds counterintuitive — like you’re just moving your debt from your credit cards to a loan — but the truth is, this could lower your monthly payment, save you tons of money in interest over time, and allow you to pay off your debt faster.

Just take it from Nick, with whom we chatted in 2018. He was carrying around more than $26,000 in credit card debt. He owed about $800 a month — but a lot of that was going toward interest, not actually chipping away at his debt.

He felt like his wheels were spinning, until he read about refinancing. He took out a personal loan and used it to pay off his credit cards. His monthly payments dropped from $800 a month to $667 a month, thanks to the difference in interest. Plus, he’ll be debt free a lot sooner.

If you’re not sure where to look for your personal loan options, we like a website called Fiona. All you have to do is fill out one page of information, then you’ll get quotes immediately.

Pro Tip

When shopping personal loans, look for interest rates lower than your credit cards’ and manageable monthly payments. Oh, and don’t take out more than you need to pay off your credit cards.

“It was such a relief — like a giant weight had been lifted off my shoulders,” Nick said, after refinancing.

You can borrow up to $100,000 through Fiona, with terms ranging from two to seven years. Interest rates start at 3.84%. though note you’ll want a credit score of 620 or higher. It takes only minutes to see if you qualify.

Secret No. 2: You Don’t Have To Do It Alone

Two friends walk down a sidewalk.
Close friends Sha’Kreshia Terrell (left) and Sau-Sha Hill encouraged each other to pay off their collective $70,000 debt. Chelsea Purgahn for The Penny Hoarder

Think about this: When you’re trying to get in shape, isn’t it easier when you’ve got a partner? A spouse who’ll be your gym buddy? A friend who’ll text you encouraging words? Even someone who you can compete against to get the most steps?

Well, why not use this same trick when it comes to paying off your debt? Grab yourself a money buddy!

That’s what friends Sau-Sha Hill and Sha’Kreshia Terrell did. Between the two of them, they had 12 credit cards and a collective $70,000 in debt.

“At the beginning of each month, we write down a list of clear goals that we would like to achieve before month end and send them to one another,” Terrell said.

Hill added: “Sha’Kreshia would literally take my credit cards out of my wallet and keep them at home.”

When we talked to the duo earlier this year, Terrell had $1,450 of debt left, and Hill had $2,500. Not bad, right?

If you need a money buddy — but maybe don’t want to bring your friends or family into your financial business — turn to The Penny Hoarder Community Group. Members share their favorite ways to pay down their debt and keep each other accountable.

Secret No. 3: Every Little Move Helps

A woman shops at Wal-Mart.
Frost saves and earns money using the a cash-back app while shopping at Walmart. Matt Roth/The Penny Hoarder

We’re going to tell you how to get some free Visa gift cards, and you might be thinking: How’s a gift card going to help me pay off my debt? But trust us: Every little move counts.

We’ve talked to plenty of folks who’ve earned a ton of money using cash-backs apps. If you’re not well-versed in this world — or just want another one to add to your collection — we suggest Fetch Rewards because it’s so easy to use.

With Fetch, you simply take a photo of your grocery receipt (from any store!), submit it through the app and earn points. You can then exchange these points for gift cards, which you can use to offset some of your regular monthly expenses, like groceries or a dinner out.

We spoke with an avid cash-back app user Nancy Frost, who earned more than $430 in a year. She was using the money to put toward her retirement, but you could easily use it to make an extra payment on your debt.

When you download the Fetch app, be sure to use the code PENNY to automatically earn 2,000 points when you scan your first receipt — you’ll be well on your way to your first gift card.

Secret No. 4: Map Out a Plan — and Stick to It

portrait of Melinda Smieja
After her daughter was diagnosed with a terminal brain tumor, Melinda Smieja was overwhelmed with debt. Photo courtesy Melinda Smieja

After her 13-year-old daughter was diagnosed with a terminal brain tumor in 2005, Melinda Smieja faced a slew of expenses. She racked up debt, somewhere between $20,000 and $30,000, on 11 credit cards.

Like any big move you make in life, you need some kind of plan when it comes to paying off debt.

If you need some help devising that plan, many personal finance experts suggest one of two debt-payoff methods:

  • The debt avalanche method: This is when you prioritize your debt with the highest interest rate first. The idea is to save money on interest over time.
  • The debt snowball method: This is when you pay off your smallest balances first. It’s perfect for folks who are motivated by instant gratification.

But let’s back up really fast. Maybe you aren’t even entirely sure how much you owe at this point and feel totally overwhelmed. That’s where a free website like Credit Sesame can help. It’ll outline your total debt and even break down how much you owe and to whom, as well as interest rates and minimum monthly payments.

It helped Melinda Smieja pay off the approximately $30,000 worth of debt she’d accumulated on 11 credit cards when her daughter was diagnosed with a terminal brain tumor back in 2005.

Smieja didn’t know where to turn. She’d heard about Credit Sesame and decided to give it a try. After all, it’d take less than two minutes for her to sign up.

“I could look and I could say, ‘OK, this is what’s all going on here. This is my debt. This is what’s happening. This is what’s making my credit (payment) high,’” she said.

Armed with the information she needed to begin making moves, she mapped out her debt snowball repayment plan. She paid off the card with the hightest balance, then worked her way down.

Eventually, she became debt free — and cut up her credit cards. Her credit score consequently jumped up 264 points.* Sure, it took a while, but Smieja says Credit Sesame helped her get there — and signing up takes no time.

Secret No. 5: You Might Benefit From a Short-Term Side Gig

Maybe you’ve been thinking: This advice is great and all, but I hardly have enough money to pay rent — let alone pay off my debt.

If that’s the case, you might want to look into a flexible side gig. No, this doesn’t have to be a forever thing. You might only need to do it for a month or two. But the extra paycheck could really help you get back on track — or even ahead.

There are plenty of flexible side gigs out there these days, but we’re partial to grocery- or food-delivery apps, like Doordash. You don’t have to deal with strangers, like a ride-sharing app, and it doesn’t require much prior experience.

That was part of the appeal for Destiny Frith. At 22, she moved to a new state. She hadn’t secured a job yet, and her credit card balance crept up and up. It wasn’t anything too major — about $2,000 — but she needed to find a way to make money on the side, so she started delivering groceries.

With these types of side gigs, you get to set your own hours and work as much or little as you want, meaning how much you make is up to you.

You’ll earn money for each delivery, plus tips. Frith says the money she earned helped her put a dent in her debt and hold her over until she could find a full-time job.

If you sign up for Doordash now, it’s possible to get your first paycheck this week — just in time for your next credit card payment.

Secret No. 6: Cut Some Monthly Expenses (But Don’t Sacrifice a Thing)

A couple play with their daughter.
Cody and Georgi Boorman live with their two-year-old daughter, Eloise, comfortably in their Moses Lake home after paying down their debt. Paul T. Erickson for The Penny Hoarder

Need some wiggle room in your budget? Or maybe you’d just like an extra $440 to throw at your debt this year. That’d be nice.

That’s where cutting some of your major monthly expenses can help. One of the easiest to cut — without giving up anything — is car insurance.

And if you look for quotes through a digital marketplace called SmartFinancial, you could be getting rates as low as $22 a month — and saving yourself more than $700 a year.

It takes one minute to get quotes from multiple insurers, so you can see all the best rates side-by-side. Yep — in just one minute you could save yourself $715 this year. That’s some major cash back in your pocket.

Pro Tip

You don’t have to wait for your current policy to run out before switching. You can cancel at any time, and if you’ve already paid your premium, your current provider probably owes you a check.

For Cody and Georgi Boorman, they made a more drastic move to conquer their debt: They entirely ditched their monthly $465 car payment and got a more affordable car. This allowed them to ditch $27,000 of the total $83,000 worth of debt they’d accumulated.

They also adjusted some of their other monthly expenses: They switched from Verizon to Republic Wireless to save on their phone bill and started shopping at Costco.

Just by taking some time to examine their monthly expenses and consider alternatives they were able to cut costs. And guess what? They’re now living debt free!

So if you haven’t checked car insurance rates in a while, see how much you can save with a new policy.

Secret No. 7: Get Creative and Use Your Home

Homeowners: Did you know you can use your home — likely your largest asset — to help you become debt-free?

A home equity line of credit works similarly to a personal loan that you’d use to refinance your debt. But because your home equity line is backed by the amount you’ve paid to own your home, the loan’s interest rates tend to be lower.

It could be the perfect move for someone with high-interest credit card debt. Like California couple Wilmer and Kimberly Swerdfeger, who faced a sudden and unexpected $20,000 worth of credit card debt. Wilmer explored his options and decided an online lender called Figure would be the most effective way to stay paying off his debt.

Figure offers home equity lines of credit for up to $150,000 and with APRs starting at 4.99%.** That was way better and more affordable than the 21.99% interest they faced on one of their credit cards. The Swerdfegers were approved for their line of credit, and the money was in their account the next day.

“It was like, ‘Wham, bam, bam,’ and everything was paid off,” Wilmer says. “Now I just owe Figure. It took a lot of stress off.”

Your first step is to decide if a home equity line of credit is right for you. You’ll be using your home as collateral, but your new interest rate should be much lower than that of your credit card.

Then, consider your options with a free quote from Figure. It only takes five minutes, and if you like what you see and your application is approved, Figure will initiate funding within five days.

* Like Smieja, 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.

Credit Sesame does not guarantee any of these results, and some may even see a decrease in their credit score. Any score improvement is the result of many factors, including paying bills on time, keeping credit balances low, avoiding unnecessary inquiries, appropriate financial planning and developing better credit habits.

** Terms and conditions apply. Visit figure.com for further information. Figure Lending LLC is an equal opportunity lender. NMLS #1717824