I paid off $ 20,000 in credit card debt on a zero-based budget



DEBT is a reality most Americans face, but coming out of the red can be a bigger problem.

On TikTok, a woman told her 435,300+ subscribers how she got out of $ 20,000 in debt in one year.

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TikTok influencer explains how she eliminated $ 20,000 in debt

Between July and September 2021, US household debt hit a new record high of $ 15-24 trillion, according to the Federal Reserve Bank of New York.

Getting out of debt can take a long time, but with a little discipline and patience it can, according to TikTok user called TheAvocadoToastBudget.

His secret? A zero-based budget.

In her video, she explained how she allocated all of her money to an expense or savings category.

Every time she got paid, she gave that money a “job” and assigned it to one of those categories.

His advice is to track all of your spending and allocate money every time you get paid.

This way you make sure you stay the course.

Influencer TheAvocadoToastBudget said the benefits of doing this are more control.

You save more money and you know where your money is going.

She found this strategy as a way to pay off her $ 20,000 debt faster, but also frankly explained the downsides of engaging in this technique.

The TikToker has stated that accounting for your money takes longer because you have to keep track of every part of your spending.

She noted: “It took a long time to do it, but it was totally worth it.”

What is a zero-based budget?

Personal finance expert Dave Ramsey explains on his RamseySolutions site that zero-based budgeting is a way to budget where your income minus your expenses is zero.

All of your expenses are documented for each paycheck, month and quarter.

You build your budget based on upcoming goals.

Zero-based budgeting is a technique used by many businesses.

When an individual or family uses this method, they will allocate all income to specific expenses, including retirement and savings, leaving you with zero dollars at the end of each pay period.

We tell you if you need more stimulus money.

Plus, how to get a free limited edition mug at Starbucks.

I saved $ 60,000 just this year by tracking my expenses, here is my tip

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