Keep tabs on debt with creative visual aids

WWith $ 82,000 in debt, buying a home seemed a long way off for Ehren Sixon and his wife, Florida residents who embarked on a debt-free journey in 2016. They opted for it. debt snowball method, a debt repayment strategy that encourages motivation by quickly attacking smaller balances first.

The couple also followed each step along the way with different visual aids as they paid off car loans, student loans, and credit card debt.

“We wanted to be able to track our progress and stay motivated,” says Sixon, a 32-year-old systems engineer and part-time YouTuber.

The internet is full of debt tracking templates that can help you record milestones towards your debt free goals. From coloring pages to spreadsheets, here’s how you can use visual aids to eliminate debt.

Visual aids motivate

If you’ve got a long journey ahead of you, a roadmap that tracks your progress can offer support and encouragement.

“You get a lot of little dopamine shots ticking off those little milestones or those little things along the way, and that really keeps the motivation going,” says Katharine Iesiev, owner of She Minds Money, a Massachusetts-based financial therapy service. .

Yesiev favors creating something tangible that you can print and view often at home.

Track your progress in several ways

The Sixons have taken to the internet for debt management solutions. As you explore your options, think about what will be the most motivating for you.

Spreadsheets

Sixon started out with a spreadsheet to track all lenders, balances, and paid debts. A spreadsheet can be as simple or as elaborate as needed. You can use it to record each payment to each lender or to update balances after you make a payment. A key benefit is that it can keep debt and information organized. It also pairs well with other tracking systems.

Printable for daily viewing

The Sixons also reviewed online templates to make it easier to check debt goals. They chose a thermometer for their refrigerator and then moved it to the front door as a daily reminder to stay true to their goal. With each monthly check-in, they would rate their progress and color the thermometer, each paying 10% of their debt.

“With the spreadsheet, there were times when we were so caught up with overdue balances instead of celebrating how much we had paid so far,” says Sixon. “I hadn’t realized how fun and exciting coloring part of this debt thermometer was, but it made our debt-free trip more enjoyable. “

Also consider coloring pages that display pictures such as a house to represent a mortgage or a car to represent a loan. You can fill in the increments as you make payments.

For a different creative approach, a progress card can offer an attractive and understated artistic design with unlabeled increments that you color in the same way. For the Sixons, their daring red thermometer became a topic of conversation and inspired some friends to pay off the debt.

“They were grateful to have seen the way we installed it in our house and they were able to do the same,” he says.

Bullet journals

A bullet journal is less noticeable than a page that you can print and display, but it could offer more frequent engagement with your finances. Keep it as simple or creative as needed. In 2018, Kaila Penner, co-owner of the blog Frugal Twins, drew an easy bar graph inside her bullet journal to track payments for the last $ 24,000 on a car loan and two student loans. She colored each bar with pink, green, or blue ink after meeting each $ 1,000 increment.

It is possible to further break down the increments and designate different pages for different types of debt. So instead of a bar graph, you can choose to draw graduation hats, dollar bills, or whatever else you can color to represent paid debts.

Like Sixon, Penner also used a spreadsheet throughout his journey, but it wasn’t as motivating as the bullet journal. “Completing that every month was a lot more satisfying for me,” says the Iowa resident.

She also added a thermometer to her refrigerator door for daily visibility. With all three trackers, she’s made progress in crushing debt.

Rely on visual aids long after debt

The Sixons paid off their debt earlier than expected in 2018 by budgeting for cash envelopes and cutting back on categories like restaurants and streaming subscription services. They now use a thermometer to track savings instead. In anticipation of their baby girl’s arrival, the Sixons recently colored a thermometer showing their savings for a family-friendly vehicle.

“To go out in 2021 and buy a car without a car loan – fully paid off – and get it ready for our kid, I didn’t think we would be at this point in our financial journey,” Sixon said. “It’s incredible.”

They currently use several thermometers that remind them to focus on priorities like paying for their house and saving for renovations and travel.

This article was written by NerdWallet and was originally published by The Associated Press.

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Melissa Lambarena writes for NerdWallet. Email: [email protected] Twitter: @LissaLambarena.

The article Keeping an Eye on Debt Using Creative Visual Aids originally appeared on NerdWallet.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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