Millennial Money: She crushed $20K+ in debt at age 24

Jun 1, 2021, 4:00 AM | Updated: 4:53 am

With over $195,000 in student loan debt, Annika Hudak saw little harm in swiping her credit cards.

“I was in the mindset that I’m going to be in debt forever, so what’s a couple of thousand dollars here,” says Hudak, 25, a product analyst in Oregon.

Hudak eventually racked up about $20,242 across four credit cards by charging food, textbooks, school supplies and other expenses. Like her, many borrowers also have other forms of education debt outside of student loans, including 21% who hold credit card debt, according to a recently published Federal Reserve report based on 2020 data that explores the economic well-being of U.S. households.

In college and in the first years of her career, she hadn’t found her financial footing. It wasn’t until she heard others’ debt payoff stories on YouTube and other platforms that she felt hope, learned money management skills and found a road map to pay down debt.

In January 2020, she began her debt-free journey and paid off all credit cards before the year’s end. Here’s how.


Hudak set a goal to become debt-free by 30, envisioning goals like building wealth or buying a house. She jotted down all her debts as she went along to get a full picture of the amount owed.

She also looked at expenses. It’s important to review credit card and bank account statements to see where money is going, says Jeffrey Arevalo, a financial wellness expert with GreenPath, a nonprofit credit counseling agency. Look for opportunities to cut back on unnecessary purchases like unused subscriptions.

Hudak builds her budget months in advance to plan debt payments. “It’s definitely a trial-and-error process, and you have to find what works for you,” she says.


When exploring ways to pay off credit card debt, checking your credit score in a credit card issuer’s mobile app is a good way to know where you stand with options.

A balance transfer credit card , for instance, typically requires a good FICO credit score of 690 or higher. This option lets you move debt from a high-interest credit card to one with a lower interest rate, typically for a fee of 3% to 5% of the amount transferred. The money saved on interest can be applied to your balance, cutting down the time it takes to pay off the debt. The ideal balance transfer card has no annual fee, a 0% intro APR and a low balance transfer fee.

“Look at the cost of the fee versus the savings and interest,” Arevalo says. “That interest savings a lot of times is going to be a big benefit.”

Hudak was approved for a balance transfer with a 0% introductory APR over seven months in January 2020.

The amount transferred can only be as high as your credit limit. For Hudak, that meant she was able to move slightly less than half of her highest credit card balance to the new card. The remainder of that balance was subject to a 26% interest rate, so two months later, she applied for another balance transfer card through her credit union, which offered an APR of 8.99%.


Hudak stopped using her credit cards and aimed to pay off one of them over that initial seven-month promotional period. She used a debt reduction calculator to keep track of how long it would take to pay off all her cards.

Hudak tackled smaller debt amounts first — known as “the snowball method ” — to get instant gratification and stay motivated with every balance paid. Another approach, “the avalanche method,” would be to pay down high-interest debt first. Choose the method that works for you.

Her plan also included earning extra income to put toward debt. She retained her full-time job amid the COVID-19 pandemic and had some side gigs. She taught children at a virtual coding camp, edited videos and got paid for other as-needed tasks.


Hudak stayed motivated with a budgeting app to count every dollar. She also used a bullet journal and a spreadsheet to track combined debts and celebrate small victories.

She says she paid off the first card in June and by November 2020, at age 24, she had wiped out her credit card debt completely. After that milestone, she put her energy and money toward her car loan and paid it off in February . Her efforts are now on demolishing that six-figure student loan.

“I think staying focused is my biggest goal and also the hardest one because now that I’ve paid off those smaller debts, I don’t have that next win anytime soon,” Hudak says.

Hudak aims to be debt-free by 2026 and is now on the other side of the YouTube camera. She hopes her channel, Annika Hudak, will be one source of income as she documents her debt-free journey to show others it’s possible.


This article was provided to The Associated Press by the personal finance website NerdWallet. Melissa Lambarena is a writer at NerdWallet. Email: Twitter: @lissalambarena.


NerdWallet: How to get out of credit card debt in 4 steps

Federal Reserve: Economic well-being of U.S. house holds in 2020

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Associated Press

Judge dismisses lawsuit over US utility’s long-term deals

NASHVILLE, Tenn. (AP) — A federal judge has dismissed a lawsuit by environmental groups that challenged how the nation’s largest public utility signs up local power providers for two-decade contracts. On Wednesday, a ruling by U.S. District Judge Thomas L. Parker in Memphis sided with the Tennessee Valley Authority, agreeing that the environmental groups don’t […]
18 hours ago
Associated Press

Authorities: Woman sent to Iowa funeral home was alive

A continuing care home in suburban Des Moines, Iowa, has been fined $10,000 after a funeral home discovered a woman sent to it in a body bag was still alive. The Iowa Department of Inspection and Appeals said in a report filed Wednesday that the 66-year-old woman was declared dead at the Glen Oaks Alzheimer’s […]
18 hours ago
Associated Press

Kohl’s names Tom Kingsbury as permanent CEO

NEW YORK (AP) — Kohl’s said Thursday it has named acting CEO Tom Kingsbury as its permanent leader. Kingsbury, a Kohl’s board member with more than 40 years experience in retail, has served as an interim CEO since early December, when Michelle Gass left the department store chain to become president of jeans maker Levi […]
18 hours ago
Associated Press

‘Boom’: FirstEnergy exec text revels in landing state plane

CINCINNATI (AP) — New details emerged Thursday at the trial of former Ohio House Speaker Larry Householder on the use of the state plane scheduled to bring state lawmakers back to Columbus to vote on the now-tainted nuclear bailout legislation at the heart of Ohio’s largest ever corruption case. Text messages presented to jurors in […]
18 hours ago
FILE - Republican Gov. Tate Reeves outlines his priorities during his State of the State address on...
Associated Press

Doctor, GOP governor clash over private Medicaid discussion

JACKSON, Miss. (AP) — Mississippi’s Republican Gov. Tate Reeves said in a private conversation that expanding Medicaid to people working low-wage jobs would be in the best interest of the state, but that he refuses to support the policy for political reasons, a former chancellor of the University of Mississippi said Thursday. Dr. Dan Jones […]
18 hours ago
FILE - This Wednesday, July 24, 2019 photo shows an Apple Store in Chicago is seen. Apple reports f...
Associated Press

Apple suffers 1st quarterly sales decline in nearly 4 years

Apple on Thursday posted its first quarterly revenue drop in nearly four years after pandemic-driven restrictions on its China factories curtailed sales of the latest iPhone during the holiday season. The company’s sales of $117 billion for the October-December period represented a 5% decline from the same time in the previous year, a deeper downturn […]
18 hours ago

Sponsored Articles

Day & Night Air Conditioning, Heating and Plumbing

Company looking for oldest air conditioner and wants to reward homeowner with new one

Does your air conditioner make weird noises or a burning smell when it starts? If so, you may be due for an AC unit replacement.
Fiesta Bowl Foundation

Celebrate 50 years of Vrbo Fiesta Bowl Parade magic!

Since its first production in the early 1970s, the Vrbo Fiesta Bowl Parade presented by Lerner & Rowe has been a staple of Valley traditions, bringing family fun and excitement to downtown Phoenix.
(Desert Institute for Spine Care photo)...

Why DISC is world renowned for back and neck pain treatments

Fifty percent of Americans and 90% of people at least 50 years old have some level of degenerative disc disease.
Millennial Money: She crushed $20K+ in debt at age 24