Out in the Open

This frugal millennial paid off $18,000 of student debt in less than a year

Kara Perez felt like her debt was defining her, so she made some drastic changes to her lifestyle.
Kara Perez had a "quarter-life crisis", which led her to hunker down and pay off her student debt in less than a year. (Courtesy of Kara Perez)

At the age of 26, Kara Perez had what she calls "a quarter life crisis."

She was underemployed, broke and anxious about the $18,000 in student loan debt she had hanging over her head.

"My debt weighed on me every single day," says Kara. "It made me doubt myself and really dislike myself."

Growing up, Kara had seen her mom struggle with money, and wanted something different for herself. So she decided to make some drastic changes to her lifestyle. 

Kara stopped going out, she slashed her grocery budget by only eating leftovers from her catering job, sold clothes and books, and stopped buying gifts or any other non-essential items. 

Within 10 months of scrimping and saving, she paid off the entire $18,000.

Kara says her lifestyle changes set her apart from the other millennials in her social circle. 

"Pretty much everyone in my life has debt. But a lot of them were comfortable making the minimum payments," she says. "My singular focus on paying off my debt definitely made me the weird one." 

Kara is 29 now and says she's finally starting to get comfortable spending money on some things beyond the bare necessities of life.

"There is still a part of me that wants to be hyper frugal and save every single dollar," she says. "But there is a joy in knowing that I have the money to go out to dinner, or to buy a new shirt if I want."

Kara still isn't exactly where she wants to be financially, but when it comes to money, she says, "Now I feel more powerful and more in control."