Debt Mindset Series: Escaping the Debt Trap

Welcome to another weekly dose of the Debt Mindset Interview series. If you’re new, each week I share an interview an inspiring person who is either kicking debt to the curb or has already made their final debt payment.

These interviews are different from the usual in that they focus on mindset and each person’s choices behind their decisions and debt payoff strategies. No one’s journey is perfect or easy, so I like to focus on the obstacles and the mindset shifts that need to be made in order to succeed.

When it comes to personal finance and debt payoff, you’d think success starts with having more money or a higher income, but it actually begins with your mindset. If you don’t have the right mindset and know exactly what you want, you’ll fail before you even start.

This week I’m excited to share my interview with Colin, a fellow blogger who I met last year at a conference. I ran into him at the expo hall on the second day of the conference and I was blown away when he told me he had some availability in his schedule and flew in from Thailand where he teaches English just to attend the personal finance blogger’s conference.

Talk about dedication! Colin recently paid off all his student loans not too long ago and I witnessed his infamous happy dance on Instagram Stories 🙂 Be sure to check out his site and his post which shares more details about his debt journey after reading this interview.

Colin Ashby is the writer behind Rebel With A Plan, a personal finance and self-development website for people who choose to rebel against the norm of living in debt and feeling financially unenlightened. He believes everyone has an eccentric quality to embrace and that lattes are sometimes a necessity (despite what the personal finance community tells you).

Describe your debt situation.

I graduated college with $21,000 in student loans. I’m not sure if this is considered a purchase or not, but the first memory of me contributing to my debt occurred when I arrived at my college campus for my freshman year. My financial aid had just been dropped into my student account and I remember thinking “The money looks great but it isn’t really mine”.

I’ve been fortunate to never have to deal with super high-interest debt like credit cards. But having student loan debt is a weight I want to get rid of. I supported myself for the most part throughout college so I understand that my student loans helped me but I do want to pay them off and get them out of my life.

When did you decide your debt was a problem? Did you have an ‘aha moment’ and what triggered it?

I used to never think much about my student loans. When I was in college, I thought that when I graduated I would just get a job and start paying them off. The thought of interest rates and interest accruing on the debt didn’t even pass through my mind.

I started to take my student loan debt more seriously when I graduated college and was looking to move to another state. I had been wanting to leave my home state of Texas for some time and had my sights set on moving to a place like Chicago or Atlanta.

In preparation for the potential move, I budgeted out what my monthly expenses would be in the new city and that’s when I realized my debt was a problem. I wouldn’t be able to have room in my budget for other things because of my debt. Having debt kept me from having the freedom of more opportunities.

Did you implement a specific strategy to start paying off debt? Why did you use that strategy?

When I first started paying off my debt, I was super discouraged so I utilized the Debt Snowball method, a debt repayment method of paying off the smallest debts first, to get some quick wins and give me more motivation to continue.

Now I use the Debt Avalanche method, a debt repayment method of paying off the debts with the highest interest rates/biggest amount first. It makes the most sense for me because I want to save money on interest as much as possible.

Related: Creating a Student Loan Debt Plan of Attack

What are some obstacles you were/are faced with? How did you deal with the days when you lost motivation?

For a while, I stressed out about not being able to put massive payments towards my debt because of my modest income. I would constantly see stories about people who paid off 15k of debt in one year or 40k of debt in two years. Reading those stories left me discouraged and like I was somehow doing something “wrong” in my debt repayment.

However, the biggest obstacle wasn’t my income, it was pro-debt society surrounding me. People didn’t (and still don’t) understand why I’m so passionate about destroying my debt. Financing cars, buying big houses and putting things on credit are seen as normal.

The most important thing I learned is to stop focusing on what other people are doing with their lives and focus on what I want my life to look like. Several people I knew were financing new cars out of college and planning expensive weddings. Every time I encounter this, I just nod and keep going on with my plan.

My view of things, and the foundation I want to build right now are different and that’s okay. This was the hardest but most important thing I learned.

Why Choose to Move Abroad Despite Student Loan Debt? Did It Make Things Easier or Harder?

I chose to live abroad because I wanted to experience different societies’ values and their outlook on life. I also think it’s interesting to learn about how income level and debt play factors in different parts of the world. Originally, I wanted to eliminate all of my student loans before moving abroad, but I knew it would take a few years to reach that.

I was in a job I disliked that made me spiral into a deep depression. I thought for a while about just finding another job but in the back of my mind, I always yearned for a sense of adventure and loved the idea of “slow travel” rather than just visiting a place for one week. I figured moving abroad would allow me time to ramp up my skill set and explore personal development activities.

Moving abroad while still carrying student loans was scary but having a good-sized emergency fund and the inner motivation to pursue extra income opportunities while abroad make me more at ease.

In addition to my full-time job at a school, I also do lots of tutoring and some design work to make extra money every month. I put a set amount towards debt repayment. I treat it like a non-negotiable bill.

The disadvantage to living abroad while still in debt is the instant gratification factor. Since you’re here in a nice, foreign place, you want to explore as much as possible. It’s easy to slip into a habit of going to bars every weekend and constantly going on trips. You have to really decide what’s important.

The advantage? I’m not sure there are any, haha. I guess one advantage of having debt while living abroad is that it shows you just how much debt is holding you back from having more experiences.

What motivates you? What would you say to people who think they can’t get out of debt in an attempt to change their mindset?

Anger really motivates me. The anger that people become trapped in life due to their debt. I hear several times about people who want to start a new career, move somewhere, or try something new but they can’t because of their debt.

To anyone who feels hopeless with their debt, I would say the first thing you need to do is understand that your debt is not part of your identity. Debt has no place in determining your self-worth.

One of the most important things I did was pay attention to the psychological aspect of having debt. Learning more about this prompted me to start practicing gratitude and carve out time (even if a small amount) for creative expression. This helped tremendously in coming to terms with my debt and developing a plan of action going forth.

Learn More About Colin

Website: RebelWithaPlan.com
Instagram: @colinjashby (I love shooting landscapes and dogs! haha)