Transcript for Sisters Team Up to Eradicate Nearly $200K in Debt
Now we turn to our series, secret cash stash and this morning, we have the story of four sisters in their 20s, they were drowning in debt. We first saw the sisters in "Forbes" magazine and needed to learn their siebolds to erasing nearly $200,000 and, guy, they did it in less than two years. Becky Worley shows us how. Reporter: The sisters from Dallas, Texas, had always been close. Four young women, four years apart but with one big problem they were all confronting. It was a bit embarrassing to admit that, oh, I have so much debt and can't make a depth in it. In my case I had stopped making payments because I couldn't keep up. Reporter: They had a combined income of $106,000 a year. But between student loans, car payments and credit cards, their combined debt had ballooned to $182,000. Insurmountable they feared but came up with a novel concept. Band together and attack it as a team. Their loan became our loan. It was no longer your debt, it was our debt. Reporter: And now they're sharing their secrets. First step, move in together. All four sisters rented a house and became roommates, a savings of $400 a month. Another secret, they direct deposited their paychecks to a joint account. We're going to pass out some allowance. Reporter: And held sister meetings where they handed out Ang allowance of $75 each every two weeks for spending money. The plan, credit cards paid off first. Student loans last and within a month, credit cards were Welcome back to "Gma." Time now for the ""Nd I exon hid S T mog'rnotsin H button, parenting ale about add. As kids head back school it's season diagnosis of attention disorders appear to be on the rise and a brand-new survey reveries haveth STE bet insist ancso T WER the kids need he.lp nzlian jasie the details. Reporter: This morning a new report from the CDC saying parents may be the best at picking up early signs of add inhe tir children. I just K started, all four student loans were paid in full. No way would we have gotten done with our payments within the next 10, 15 years. And definitely no way we would have done it in 18 months. Reporter: $182,000 in debt vanished in 18 months bichir discipline, sacrifice and a plan that could work for you too. For "Good morning America," Becky Worley, ABC news, new York. Wow! Two key word, discipline and sacrifice and Rebecca Jarvis, ABC's chief business correspondent is back with us with even more tips. Rebecca. Hey, Lara, this is a story. I mean their story is incredible. You can see what they did, what they -- very inspirational much it's a perfect time for people to start thinking about this. It's back to school. Parents are setting budgets for their kids for their family so that's the first thing you want to do is set that budget. Do it right now. There's a lot of technology out there that will help you do this. Apps like mint will let you track everything that you're spending, every account you have open. Also, for paying down that debt -- That's great. I think it's a good thing to teach kids. Actually you can teach your kids more about this. My mom used to do this with me. She would say look at every price and add them up. Think about what you're pout putting in the shopping cart H is a great thing you can do with your kids and teach it early. Debts, pay the most expensive ones down first. If you're paying interest on those debts that's continuously adding more and more debt. Some would think let me get the little ones taken care of because that's -- the list is shorter, but, no, you're not really getting a good bang for your buck. Might feel satisfying but you're just adding more debt so list them, know exactly which credit cards you have. Know which car loans you have outstanding. In general the credit cards will be the most expensive debts that you own and lastly, pay in cash. It is phenomenal what paying in cash can do if you have that budget in place, you take out a certain amount every single week and you stick to that budget. You're going to save 20%. Studies are showing this right now that people who switch over to cash and I followed a couple of people who have done this. Once it's gone it's gone. I guess I can't buy that. Can't go back to the atm after that. Those are great tips. Rebecca, thank you so much. Thank you.
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