How I paid off $18K of personal debt in less than a year

Anf Chansamooth
November 18, 2022
How I paid off $18K of personal debt in less than a year
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Disclaimer: Anything you read here should not be taken as financial advice. I'm not a financial advisor. The strategies and principles we'll look at are things that have worked for me and may or may not work for you. Please research and consult a certified financial expert if you want personalized advice.
It was November 2018, and I owed $18,000 to a debt collector.
After a recommendation from a mate, I picked up the book Barefoot Investor by Australian personal finance educator Scott Pape.
After reading the book, my wife and I put our "Barefoot plan" in place. Our money management plan involved dividing our income into three separate 'buckets':
a Blow Bucket, for everyday bills, the odd extravagance, and some additional money to handle unexpected costs.
a Mojo Bucket, to provide some ‘safety money,’ and
a Grow Bucket, to build long-term wealth and total financial security.
Here's how we allocated our income (at the time):

I also set some personal money rules for myself:
1. Always have 6-12 months of emergency fund cash.
2. Put 12.5% away for debt reduction (this will become my investment fund once I clear all my debts)
3. Invest in learning, experiences, and giving back.
As a sole proprietor, my income had fluctuated since the pandemic hit, but I managed to cover my rent and put away money each month towards clearing off my personal loan debt.
This debt started as a $30K personal loan for some educational training programs that I took (which ended with a one-week event in Maui) and has been following me since 2009 (eleven years!).
So it was approaching Xmas Dec 2018, and I called up the debt collector and negotiated 50% off the total amount owing. (Shout out to Ramit Sethi for his great debt negotiation tip!).
Fast forward five months, and in May 2021, I paid off the last $9k of my $18K debt.

As you can imagine, at the ripe age of 42, I felt a great weight off my shoulder and was positive about the future. I also had the best month in terms of sales for my business that year.
The important takeaway from this experience:
You're never too old to improve your personal financial situation - but you've got to learn from trustworthy people.
In my next newsletter, I'll look at the problem with financial advice, and how we as a society got into the mess we're currently in. I'll also share some principles and strategies for saving, investing, and achieving financial freedom from credible sources.
Anfernee Chansamooth
What's new this week
1/ New blog post: 7 Skillful Examples of Long Form Content
2/ Coming soon... Notion + AI = magic! Join me in the alpha waitlist!
3/ I'm currently writing this from Suvarnabhumi Airport, Bangkok. C and I had a 24-hour stopover here and we're literally waiting for our plane to Phuket. We've got a week's vacation before heading back to Danang.