Miranda Free, a 28-year-old speech pathologist at UCLA, was going about her life paying down her student loan, when two days ago, Dave Ramsey, one of America’s most trusted sources for financial advice reposted her Instagram photo. This photo was an announcement of Miranda paying off $130K dollars of student loans in just 3 years! After Dave Ramsey reposted her photo, it has garnered over 30,000 likes and has a lot of people curious, “HOW’D YOU DO IT!?” Being on my own journey to financial freedom, I wanted to learn from her experience as much as possible, so I decided to invite Miranda Free to the show and she agreed to come on and share her debt free story with us! If you are ready to forget “the Joneses” and live free, you will love this interview.
Favorite Success Quote
“To give anything less than your best is to sacrifice the gift.” – Steve Prefontaine
1. Make Sacrifices | Start Seeing Debt As Baggage
During the three year period of paying off her debts, Miranda made multiple sacrifices from skipping lunches to driving a 2007 Honda.
2. Learn To Say NO.
The word ‘No’ holds a lot of weight. It is actually an aggressive word because it takes a solid stance and an unshakable point of view. Saying no to yourself and to people who may attempt to pressure you into spending money you do not want to spend, is powerful. Be willing to say no. This is necessary if you are to become debt free.
What was the most extreme sacrifice you made?
One day I ended up skipping lunch for free Graham crackers because I forgot my lunch.
3. Tell The People In Your Life What You Are Doing!
Make sure the people you are surrounding yourself are at least willing to support you. When you start out on the path of paying off all of your debt, tell the people in your life openly. Share with people what you are doing, why you are living so frugally, and why you are doing it. Miranda was surprised to find the response from most was overwhelmingly supportive. Ask for help where possible. If you are humble enough to seek help and guidance, you will take the shortest path possible to financial freedom.
4. Intentionally and Intensely Set Up A Plan and Written Budget
Yes, no one enjoys budgeting.. well, maybe some CPA out there gets off on it, but most of us can’t stand setting up financial documents. If you need to, reach out to your business’ accountant and ask for assistance. Without a written budget, you are planning to fail. You should review your budget monthly, especially if your income varies (this is normal for entrepreneurs and salespeople).
Here is How Miranda Paid Off 130,000 in just Three Years:
Write down all of your necessary expenses (these include things like food and shelter only), and put everything else you earn towards paying off your smallest loan first. Miranda reflects on her initial approach to paying off her highest interest rate loan. Mathematically she understood that paying off the debt with the highest interest rate could save her the most money, but psychologically and for the sake of motivation, she recommends people take Dave Ramsey’s “Debt Snowball” approach. Pay off the smallest loans in order of size, smallest to biggest, regardless of interest rates.
Remember, minimize, and consider eliminating smaller daily expenses. Though a latte is not going to make or break a budget for most, Miranda realized she was buying a $5 latte every single day, costing her almost $2,000 each year. Be honest with yourself and start tracking every single dollar. Every single dollar that enters your bank account should have a pre-determined destination before it enters your account(s).
Favorite ways of increasing / supplementing income?
Per diem jobs. Look for what you can sell.
Heart Healthy Hustle Round
Heart: What activity do you use to care for and strengthen your internal character?
Miranda reads often and enjoys writing fiction.
Health: How do you maintain your physical health and avoid burn out?
Yoga, running, weight lifting, and maintaining routine consistency.
Hustle: What’s your main motivation for doing what you do?
Crushing debt and achieving the emotional freedom from the baggage of debt.
“The Total Money Makeover” by Dave Ramsey
“The Millionaire Next Door: The Surprising Secrets of America’s Wealthy” by Thomas J. Stanley
“Young, Fabulous and Broke by Suze Orman
“The Park Bench Paradigm”
If you could go back in time, what would you tell your younger self and why?
Take out fewer loans. Be bear bones live like you are broke and don’t go out to eat, etc.
Connect with Miranda Free
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