Buzz
Kara Perez, a 29-year-old freelance writer from Austin, Texas, didn’t understand what an IRA was until someone casually mentioned it when she was 25 years old.
By this point, Perez had been working as a waitress for several years after graduating during the 2011 recession with an English degree and $25,000 in student loan debt. She shared an apartment with three roommates and juggled multiple odd jobs while pursuing her dream of becoming a writer.
In June 2014, after making minimal payments on her debt and still living with roommates, she had a turning point: “I had my breakdown,” she recalls. “Nothing in life was working the way I wanted it to. I thought, ‘Holy moly, I have to get it together.’”
Perez was raised in a single-parent household that relied on food stamps for a period, and discussions about personal finance were scarce at home. But she knew that to achieve the freedom she desired, she had to break free from her debt. In her mind, the only path forward was to aggressively pay off her obligations. She turned to personal finance blogs and websites that promoted a minimalist financial approach, like the Frugalwoods. Over the next year, “I lived super frugally, I cut everything out,” she shares. “No Christmas gifts, no outings for drinks, I minimized driving and walked more, I sold books and clothes.”
She took on various side gigs, including working as a receptionist at an MMA gym, catering, and freelance social media writing. By June 2015, just a year after her financial crisis, she had fully paid off her debt—all on her own—with no external financial support, while earning just $18,000 in 2014 and $32,000 in 2015.
In addition to her freelance work, Perez now runs Bravely, a personal finance platform aimed at women, cohosts the Fairer Cents podcast, and organizes personal finance events. Her goal is to help others achieve their financial objectives. Here’s her journey.
How did you handle everyday living expenses while aggressively working to pay off your debt?
My expenses were already quite modest, and I maintained them that way. I relied on leftovers from catering jobs (in February 2015, I didn’t buy groceries and only ate leftovers to save money), shared an apartment with three roommates, and stopped eating out. Sticking to the plan was key.
Did you face setbacks while paying off your debt? How did you stay on track?
There were no slip-ups. Being debt-free meant more to me than anything else. I wanted it so badly that I could practically taste it. I dedicated everything to achieving this goal and didn’t falter. Becoming debt-free mattered more than traveling or dining out. With only a small remaining balance, I knew I could pay it off immediately instead of dragging it out for years. Why carry around $18,000?
Did you receive help from anyone?
No regular financial assistance, but I had a lot of emotional backing from my friends and my boyfriend (whom I’m still with). For Christmas and my birthday, my Gramma would give me $100 each, which I put directly toward paying down my debt.
You’re a big advocate for side hustles. What odd jobs did you take on?
I worked as an MMA gym receptionist ($9/hr), a caterer ($12/hr to start, bumped to $15 during my debt repayment period), a lacrosse coach (stipend), a van driver ($1500 stipend), a freelance social media writer ($12/hr), a nonprofit development director (starting at $11/hr in 2014, later moving to a monthly stipend in 2015), and a nanny ($15/hr). I also did odd jobs like waiting in line for $100 for a guy.
What would you say to those who feel they don’t have marketable skills in that area?
Take a look at the various side gigs I took on! Ideally, your side hustle should help you advance your career or teach you new skills. But if it’s simply about earning extra cash, that works too! There’s always an odd job out there that needs to be done.
What are your current financial goals?
In the short term, I aim to max out my 401(k) (I’ve already maxed out my IRA for the past three years). Long term, I’m working toward financial independence.
What’s the key to saving or reaching another financial goal?
You have to desire it more than anything else in front of you. I succeeded because I was fully committed, giving 110% effort and working toward my goal every single day. You don’t need to be as intense as I was, but consistency is key.
What’s the best financial advice you’ve ever received?
Have separate savings accounts for different financial goals. For example, your down payment savings should be kept apart from your emergency fund.
What’s your advice for people buried in debt or unsure where to start with their finances?
The first step is always to face the numbers. You can’t change anything if you don’t understand where you stand. So sit down, look at your situation without judgment, and then figure out what you want to improve. From there, create a more specific plan to make those changes.
