A YouTube blogger who recouped nearly $200,000 in debt in less than two years has revealed her secrets to getting out of debt.
Aja Dang was in her early 30s when she had what she describes as an ‘aha’ moment after being faced with an unexpected vet bill that left her determined to get her finances under control.
The 36-year-old drastically stripped down her overnight lifestyle, sacrificing trips to Europe with girlfriends and dining out as she put a strict budget in place.
On top of that, it has rolled out the “debt snowball” method which urges borrowers to repay their loans in order of size – starting smallest first and working their way up.
The idea is that over time, individuals build momentum and have the motivation to stick to their plan.
Aja Dang, 36, drastically stripped down her overnight lifestyle, sacrificing trips to Europe with girlfriends and dining out as she put a strict budget in place
Dang’s debt was mostly made up of his student loans after earning an undergraduate degree in marketing from the University of San Francisco and a master’s degree in broadcast journalism from the University of Southern California.
Together they cost him $150,000, but by 2018 — eight years after he graduated — they had racked up $50,000 in interest.
The rest of his debt came from a car loan and credit cards.
But Dang said she denied her financial situation for most of her 20s before getting a wake-up call when her one-year-old dog Luke needed emergency surgery – for 5 $000.
“I was faced with a situation where I either had to take on more debt or euthanize my dog,” she told Dailymail.com.
“I never wanted to be in that position again.”
From there, she decided to start a YouTube series documenting her journey to paying off her loans — and holding herself “accountable.”
At the time, she was making $60,000 a year from her content creation.
She immediately took to online debt management blogs and cut her budget – adding that the biggest sacrifice was to stop eating out.
His main expense was $1,500 a month in rent. On top of that, she planned a $200 gym membership, $200 for car payments, $700 for food, and $60 for gas.
And she maintained one luxury — a once-a-month facial that would cost her $100.
She said: “It’s so important not to take all the fun out of your life or you won’t stick with it.
“I always tell people to decide on the things they don’t want to give up and then build them into your budget.”
On top of that, Dang has also increased her stream of income – first by earning extra cash from jobs such as dog sitting and selling her clothes on second-hand sites like Poshmark.
And over time, his YouTube series exploded in popularity, increasing his take home pay to over $100,000.
Her best advice to people in debt is to never pay the minimum repayment amount on a loan – which she says will definitely keep you in debt for life.
By overpaying, she was able to tackle both the principal loan amount and the interest.
Dang said she refuses to give up her monthly $100 facials, adding that it’s important to keep some fun in your lifestyle — no matter how much debt you have.
At the time, she was making $60,000 a year from her content creation, but soon grew her income to over $100,000.
She also recommends building an emergency fund from an early age. The goal, she says, is to have three to six months of spending in a high-yield savings account.
And she said it was important to find a “community” of other people in debt to motivate each other. She generated her own thanks to her social networks.
Dang’s advice comes as more Americans face financial hardship amid high inflation and broader economic uncertainty,
Data from the New York Federal Reserve showed household debt rose $148 billion to $17.05 trillion in the first three months of the year.
It marks a $2.9 trillion increase from the end of 2019 before the pandemic and ensuing economic turmoil put pressure on household budgets.
The problem has only been exacerbated by Biden’s debt ceiling showdown with congressional Republicans who could see the United States default on debt as early as June 1.
This week, experts urged households to make emergency preparations in the event of a default.
Previously, analysts had warned that a default could cause mortgage payments and credit card loans to rise and investments to plummet.
