I managed to pay off all of my debt, all $117,000 worth.

And so for the first time in a long time,

I could consider myself worthless.

I mean, at least as it related to my personal finances.

And so in this video,

I wanna share the three steps that I took to get there

and break down some of the important details

like my income during those years.

This video is brought to you by my friends at Squarespace,

I'll talk more about them later.

So at 22 years old and just fresh out of college,

I had over $97,000 in student loans.

And then I made the brilliant decision

to buy a brand new car.

So let's add another $18,165 onto the total,

not including change.

So at my lowest point, I had $117,000 worth of debt.

And while student loans are increasing every year,

most people don't graduate with the kind of debt that I do

unless you get into a medical field.

Now, I don't know why a filmmaker

would need $117,000 in debt to start their career,

but mistakes were made, blame it on the system,

blame it on myself and my stupidity at 18 years old,

the problem was now mine to deal with.

And at first I wasn't going to deal with it at all.

I was resigned to just paying

the minimum payments every month for 30 years

until I finally paid it all off.

But then I started to get interested in self-development.

I started to read stories of people

who had paid off their debts in two years,

five years or 10 years.

It started to inspire me to chase that kind of freedom

and that kind of financial independence,

and so that's when I got started.

And for me, there were really three core steps

that helped me get through it as quickly as I did.

Step one, intentionally cut back on your spending.

Now it really doesn't matter how much money you make,

if you continue to spend every last cent of your paycheck.

And so you need to get really intentional with

where you're spending your money and how you're spending it.

I know lots of people who make 150, 200K,

who still have tens of thousands of dollars

worth of student debt.

A lot of times we convince ourselves

that we deserve these nice things

because we work so freaking hard.

But what you really deserve after all that hard work

is to be debt-free.

And so if we can begin to reframe our spending habits,

if we don't increase our lifestyle

with each increase in pay,

then we can begin to make a dent on our debt.

One of the most difficult decisions that I made early on,

which ended up being the best one that I could have made,

was to move back home to live with my parents.

Hi, my name is Matt D'Avella,

and you are inside of the Black Box.

The Black Box!

Dinner time!

That's embarrassing.

Noodles with soup.

Yeah, I'll have some noodles with soup.

(soft music)

It was a difficult decision

because all of my friends were going off

and they were living on their own.

They were partying in the city

and dating and doing all the things I wanted to do.

And I was at home watching late night television reruns

in my parents' basement.

And it was really, truly difficult.

Like I wanted to do all those things,

but I also knew that this wasn't the time.

That right now I had to save, I had to be patient.

I had to look towards the long-term vision of my life

and take this short-term sacrifice now.

I ended up saving thousands of dollars every month

on rent and utilities,

and everything else that is associated

with living on your own.

It was around this time that I discovered minimalism.

And that really was a practice

that helped me understand my values

and change the way that I spent money.

Even though I had decided to move home with my parents,

I was still spending pretty recklessly.

I was spending thousands of dollars on clothes,

a flat screen TV,

I already mentioned,

I put $18,000 of loans into a brand new car.

And so when I discovered minimalism,

it helped me to redefine my idea of success.

I questioned what are the things

that are really gonna make me happy

at the end of the day?

Why am I making these purchases in the first place?

And when I started to ask these questions,

I realized that I didn't need to prove to anybody else

that I was successful.

Minimalism really helped me

to gain a better alignment with my spending

and the kind of future that I wanted to build for myself.

And that was a radical shift

that didn't just change the immediate future,

but it changed every decision I made from that point on

when it came to my spending.

One common misconception about minimalism

is that it means you have to live a frugal lifestyle.

And I don't think that that's true.

I don't think that

just because you're intentional with your purchases means,

that you will never buy nice things,

and you won't let yourself enjoy things

while you're also paying off your debt.

I love what Ramit Sethi teaches,

he's a personal finance expert.

He talks about not sacrificing the daily lattes.

And lattes as is metaphor

for anything that you might spend regularly,

that gives you a little bit of joy each day.

So if you cut out a $5 latte every day,

you're gonna save about $1,800 over the course of the year.

Now one, most people can't do that or won't do that,

or they will try and then give up and fail

and say, ah, you know what?

This frugal lifestyle thing,

this counting every last dollar,

it's just not gonna work for me.

Because it doesn't work for most people.

Instead what you can do is focus on the big items.

So the areas where you're spending

thousands of dollars every year,

whether it's clothes or eating out.

What are those areas

that are the biggest problem sources for you

when it comes to money disappearing out of bank account?

And how can you get more intentional with those purchases?

Again, I'm not saying that you can't buy nice things.

I don't think you need to deprive yourself

of things that will bring value and joy to your life.

But I do think we need to get really thoughtful about

which ones are essential right now,

when we're paying off our debt.

If you're making really big sacrifices,

like moving into your parents' house,

to live for a couple of years as you pay off your loans,

I think it also means that you need to get intentional

with those other decisions,

and you can make sacrifices for the first couple of years

as you begin to build momentum.

But no, you do not need to sacrifice your daily latte.

Step number two, focus on making more money.

So this is really personal finance 101.

If you wanna save more money and pay off your debts,

you need to spend less money and make more money.

I don't think that you need to over-complicate it

any more than that, it really is that simple.

But of course there are some nuances in here,

especially when it comes to making more money.

And so that's what I wanna talk about right now

and share some of the experience that I had

in increasing my income over just a four year period.

So I've never actually held a traditional job

apart from the grocery store that I worked at in high school

and was promptly fired from and sued for $7 million

for making a parody rap video.

But that's a story for another day.

♪ The fresh beats baby you know what I mean. ♪

I have run my own video production business

ever since college.

In around 2009 was the first year

that I started to make an income as a freelance filmmaker

and a videographer, whatever you wanna call it.

I made videos for clients and they paid me money for it.

Now running your own business is definitely

one of the quickest ways

to increase your income rapidly over time.

Over a short period of time I should say.

Now it's not guaranteed.

There are definitely a lot of risks involved,

and there are a lot of people

that start their own businesses

that never get it off the ground.

But if you're good enough,

if you invest in your skills

and if you invest in providing real value

to clients and customers,

a hundred percent, that's the fastest way

that you're gonna be able to increase your income.

So in 2009 was the very first year

that I made money running my own business.

And I made about $10,000 in profit.

In 2010, I nearly tripled my revenue,

my profit that year was about $28,000.

So in 2011, my revenue increased to around $53,000,

but my profit was actually pretty low

and pretty similar to the year before at $33,000.

Now 2011 was really a turning point for me and my business

while I did make around the same bit of profit.

Those first couple of years helped me to build momentum

and increase my overall revenue

and the amount of clients that I had,

which would eventually bring in more money down the road.

And so this was really that turning point that I needed

to give me the confidence to keep going with my business.

To make over $50,000, even if it wasn't profit in one year

was a huge win for me, and it showed me the potential

of where I could go with this.

2012 was a massive year for me

and was one that definitely helped me

to get the ball rolling on my debt

in a way that no other year did.

So my net profit was $94,000.

In 2013 again I had another big year,

more expenses this year as I hired more people

and invested more in my gear.

My profit was $65,000 for the year.

And in 2014, my profit, $84,000 for the year.

And so if you average it out over these four years

from the moment I started paying off my loans in 2011,

I made around $69,000 per year,

that's net profit after all my expenses.

Keep in mind that this does not include

my personal expenses,

like my rent, utilities and all that fun stuff.

Although I was able to write some of that off

because some of that was used for my business,

like the internet,

as well a very small part of my at home office.

So how was I able to steadily increase my income

over these six years?

Now the first thing which I already mentioned is,

I had to get really freaking good at what I did.

I had to make sure that I deliver

for every single client that I worked with.

Because every client that I delivered for

and I made an amazing video for,

they shared that work with other people.

They said, oh, if you need a video person,

you gotta go hire Matt, he's amazing.

That helped to build out my network

and the kind of people that came to me for more work.