6 second take: After nine years of paying off college debt, this woman reached her financial goals and continues to challenge herself.

At the time of writing, I am witnessing the beginning of my life after debt. This is the first month of my adult life that I don’t owe anyone money. I was paying off student loans for nine years, and I’ve never known what it’s like to not be in debt…until now.

One December, I made the last payment on my student loans. Though I’m debt-free now, I’m starting at ground zero. It’s a new beginning for me in many ways — a fresh start, a time to rebuild.

Getting Out of Debt

To get out of debt, I had to tap into my emergency fund. Currently, it sits at an uncomfortable level — an amount that would hardly help in a real emergency. I have approximately $600 in a Roth IRA … and that’s it.

I’m in my 30s, but my finances feel young and immature.

I need to catch up to where I should be financially, and save for my future and personal goals. This year, I have big plans to start over and finally have my money work for me. I plan to:

• Fully fund my emergency fund ($10,000)
• Invest $20,000 in index funds and my Roth IRA.

These goals are ambitious, to say the least, but I am hopeful and determined. Last year, I put $30,000 toward debt, so theoretically, I could put that same amount toward saving and investing.

There’s just one problem: I’m moving to a location with a higher cost of living.

While paying off debt, I’ve remained in Portland, Oregon, where my expenses are low. The catch? I’m not happy here. After four years of trying to be happy, it finally makes sense to move somewhere else now that I’ve entered my life after debt.

I’m moving to Los Angeles, where I am from, and where my parents live. I expect my rent to double when I move. It will be a challenge to pay double my rent and also save and invest $30,000. But there are ways that I plan to accomplish my goals:

1. Earning More

This year, I plan to earn more by targeting high-paying clients, asking for raises, and selling stuff before the move. In addition, I plan to diversify my income streams even further.

2. Automated Savings

I’m a huge fan of automation when it comes to finances. As humans, we make a lot of excuses for why we don’t do things. I’m no different. I’ve found that paying myself first through automatic contributions is the best policy. I automatically save 10 percent of my income, but I plan to increase that to at least 25 percent and contribute more as I can.

3. Avoiding Lifestyle Inflation

Even though I’m debt-free now, I plan on keeping the lifestyle I have, for the most part. I don’t plan on suddenly increasing my expenses (aside from rent).

I don’t have a car, a pet, cable, a gym membership, and I don’t buy clothes unless I have to — and I plan to keep it that way. Although my goals are ambitious, and to be honest it feels a bit stressful, I’m ready to finally live life on my terms, and not in the shadow of debt.

I’m going to make my money work for me and use it as a tool to be happy and enjoy life, no longer being crushed by the burden of debt.

In 2021, my goals are to grow my podcast, The Mental Health and Wealth show, focus on creating digital products to make passive income, and continue investing in index funds to multiple six figures.

Setting Financial Goals

You may be asking yourself what to do after you’ve reached the life after debt. “Paying off debt is like getting past the doorman. Now as a debt-free person you have more room and space to enjoy your hard-earned money,” states Jacent Wamala, licensed marriage and family therapist and money mindset coach.

“You have to transition into a new frame of mind and budgeting in a whole new way,” Wamala adds. “Include a line item in your budget to allow for fun money to be spent in the areas you value. Address your scarcity mindset that keeps you feeling restricted.”

You may also be asking yourself what the plan should be in the months following such a big milestone. “The next thing to do is to actually set another goal,” asserts Paul Sundin, CPA and tax strategist at Emparion. “When it comes to financial matters, the goals are endless, just like numbers are almost endless.”

Giving yourself something else to work toward can help you stay focused.

Whether it’s paying off student loan debt, saving a certain amount in an emergency fund, or starting a retirement account, here are some tips to help you on your next goal:

• Rethink Your Budget: Examine your priorities and long-term financial goals now that your burden of debt has been removed. “It is important not to feel deprived when you are building out your new budget, because people then tend to rebel against it. By setting realistic budgets and goals you will set yourself up for success,” says Erika Wasserman, a financial therapist.
• Rebuild Your Emergency Fund: Having an emergency fund is still important even if you have reached your financial goals. If this was your goal, great! See if you can pad it even more.
• Increase Your Retirement Fund Contribution: Now is the time to add and add a lot to your retirement so you are well prepared later in life.

Begin to Invest: Being debt-free now gives you the ability to take risks with your money ー and possibly earn rewards.Setting New Financial Goals After Paying Off Debt