(SAN DIEGO) — A California mom is entering 2022 debt-free after paying off more than $70,000 in student loan and credit card debt.

Amanda Courtney, 36, of San Diego, said she began falling into debt as soon as she entered college, nearly two decades ago.

“There was no way for me to go to college without taking out student loans, so I knew as I was applying for colleges that I was going to have to take out loans,” Courtney told Good Morning America. “I was kind of like, well, everyone takes out student loans, right? It’s fine.”

Courtney said she took out $15,000 in loans for her freshman year of college, and then also got into credit card debt when, at 18, she got a credit card without learning about how to budget and make her payments.

Over the next few years, Courtney said she transferred to two different colleges, including at one point living back at home and attending a community college, to try to lower her student loan debt.

When she graduated from college in 2008, the U.S. was in the midst of a financial crisis and Courtney said she could not find a job. Without a job, she could also not afford to pay off her student loans, she said.

“I continued to enroll in school just so I could defer my student loans because I couldn’t afford to make the minimum payments, all while continuing to accrue more credit card debt,” she said. “And I just fell deeper and deeper into debt.”

At age 25, Courtney, who now works as an administrative assistant at a San Diego high school, got a job working in education that allowed her to start to pay off her debt, but only with the minimum payments each month. She said she quickly learned that though she had deferred making payments on her student loans by taking low-cost community college classes for several years, the interest on her debt had continued to add up.

“I was deferring my loans, but I wasn’t deferring the interest, so though I was deferring making those payments, I was adding to my balance,” she said. “I didn’t have the financial literacy to understand what I was doing and the full implications of what I was doing.”

Courtney said that because federal loans and grants did not cover her full college tuition, she got a loan through a private loan company that carried what she described as an “insane interest rate.”

In the United States, Americans owe nearly $1.8 trillion in student loans, according to the Federal Reserve.

Coming from a family that did not discuss finances or budgeting, Courtney said she “truly did not know” what she was getting herself into when she signed up for student loans.

“I didn’t understand the economics of it and the commitment of it,” she said. “I think I just had this false sense of security that I’m working and I’m going to get a degree and then I’m going to have a job that can pay off the debt so it won’t be a big problem.”

“Then reality hits and you realize that’s not how any of this works and my $15,000 in loans very quickly becomes $30,000,” she said.

Things started to change for Courtney when she started dating her now-husband and they had conversations about their finances.

“I, very innocently, early in our relationship, was like so, ‘How much debt do you have?,"” she recalled. “He looked at me very plainly and said, ‘I don’t have any debt. How much do you have?"”

Courtney said she made a decision in that moment to be honest about her financial woes, and her now-husband worked with her to build a budget, the first time Courtney had done that in her life.

“I truly lived with this mindset that everybody lives with debt. Everybody has student loan debt. Everybody has credit card debt,” she said. “Having had that conversation with my now-husband, I started to think of money differently.”

With that foundation in place, Courtney spent the next nearly eight years paying off $50,000 in student loan debt and $12,000 in credit card debt.

She made her final student loan payment in September 2021.

“It took that long because I did it while still living my life,” said Courtney, who got married and gave birth to her first child and was at one point the sole income earner for her family in those eight years. “We built things into the budget so I felt this freedom to still live my life.”

Here are Courtney’s three tips for paying off debt.

1. Create a budget that works for you.

“The first thing you have to do is you have to be honest with yourself,” said Courtney. “So for me, that meant pulling out all of my credit card statements and all of my student loan balances, and really looking at where I was at, and making a plan.”

Courtney works on what she calls a zero-balance budget, which means that she directs each dollar in her paycheck to a specific location.

“Every month, a week before payday, I can actually view my paycheck, so on that day, I rebuild my budget every single month,” she said. “I look at what I have coming in versus what I have going out and I tell every dollar where to go.”

Courtney said she made sure that even while she was focused on paying off her debt, she allowed herself to continue to live her life.

“I was honest with myself, and I made a plan, but I made a realistic plan,” she said. “You have to allow yourself to go to that lunch celebration with friends. You have to allow yourself to buy yourself a new top every now and again.”

Courtney loves to travel, for example, so she created a special travel savings account that she directed money to each month. She said this allowed her to still travel while being financially responsible.

“If I want to go somewhere, I look at do I have enough in that travel account to go,” she said. “If I don’t, then I don’t get to go.”

2. Consolidate your loans, if possible.

A few years into her debt-paying journey, Courtney said she was able to consolidate her loans into one payment, which made it easier for her to track and pay off the loans.

“That was so freeing,” she said.

The U.S. Department of Education offers a Direct Consolidation loan with no fee.

3. Plan ahead instead of trying to catch up.

Courtney said she kept herself within her budget by learning to plan ahead for major events, like birthdays and holidays and vacations, instead of putting those expenses on credit cards.

“Whereas I always wanted to treat the holidays as an emergency and put it on my credit card and just make it rain in various stores, all of a sudden it was like, ‘Oh, I should be putting away money every month to get there and then look at what I have at the end of the year and look at what I can afford to do for people,"” she said. “One of the years, during my debt payoff, I made all of my Christmas presents for my friends and family.”

“I still felt like I got to give gifts, but I did so within my means,” she said.

4. Focus on small benchmarks at first.

Courtney said she at first focused on paying off her credit card with the lowest balance as a way to feel like she was making progress.

“I continued to make minimum payments on my other [credit cards], but I really focused on that one because I wanted to feel accomplished,” she said. “And when I paid off that first credit card, I remember, it felt so good.”

“It started to feel like, oh, I can do this I can make headway,” Courtney recalled. “Just with every little benchmark, it felt so great and so exciting.”

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