My husband and I are debt-free after we paid off almost $90,000 in consumer debt. It has been one of the most freeing experiences of our life! Here’s the story of how we became debt-free (and how you can too).
By April Swiger, Contributing Writer
There was nothing abnormal about my family. We had a mortgage, student loans, a car loan, and credit cards with various balances. We believed that debt was just a normal part of life and there was no way around it.
In reality, we were in a terrible place, living paycheck-to-paycheck, praying nothing catastrophic would happen. We had absolutely no savings, and were in debt up to our eyeballs. That reality was crushing, and I struggled with fear and anxiety about our financial future.
In 2013 my husband took a worship pastor job in Connecticut, and we moved in with my parents for six months. We sold our house in Pennsylvania and used the proceeds to put toward a small emergency fund and the rest toward our debt.
Living with my parents for six months helped catapult us forward in our debt-free journey. My husband took extra side jobs computer tutoring, and odd jobs he found on craigslist to pay off our debt faster (that’s a whole other blog post about the quirky gigs he took).
Over the next two years we had ups and downs in our debt-free journey. We moved into a rental home with the smallest rent we could find. We knew we were in no position to buy a house yet, and had zero down payment. My husband’s pay also increased, and we began receiving a monthly stipend from the state when we became foster parents.
Some months we weren’t able to put much toward our debt, and other months we had excess in our budget. Every extra penny went towards those pesky student loans, and our motivation to get rid of them grew by the day. We tightened up our budget and anticipated being debt-free by August 2015.
Finally the day arrived and we had the exact amount needed to pay off our final student loan. We opened the website together with our 4-year-old son (who was equally as excited), payed the final payment, and then celebrated like crazy. We screamed out loud “we’re debt free!” and praised God for bringing us the financial freedom we had been craving for years.
It felt so good.
Here are my top three strategies for paying off debt. With a plan, and a season of intensity, you can do it too!
1) Get on a budget
This was the number one way we were able to get our money under control (as opposed to us being controlled by it). It took a couple months to work out the kinks, but once we knew exactly what we needed to live on each month, we could easily allocate every extra dollar to debt. We highly recommend You Need a Budget, as well as EveryDollar.com, and Dave Ramsey’s baby steps.
When you tell your money where to go, it feels like you got a raise. You’re welcome.
2) Determine needs vs. wants
We haven’t had cable in years, but honestly, I don’t miss it. Instead we have Netflix and enjoy Redbox every once in a while. We rarely eat out, buy new clothes, or travel.
When you are determined to change your life, these are sacrifices that you make for a season. It is hard, but very worth it.
3) Commit to doing it with your spouse (or accountability partner if you are single)
Money fights are one of the top reasons couples divorce. Having felt the crushing weight of debt on our young marriage, I can see why!
Working toward this big goal (and then accomplishing it) brought us closer together and strengthened our marriage in ways we never have imagined. Our finances have done a complete 180 since our wedding day. Not only are we debt-free, but we have an emergency fund of four months expenses, and are on our way to saving a down payment for a house, and investing for retirement.
Our next big need will be a car and we plan to buy it with cash! I never thought this would be possible for us.
This was one of the hardest journeys we’ve ever been on. We went from broke to a positive net worth. Fearful about the future to confident and hopeful. Floundering through life with our money to having a plan with goals.
With sacrifice and a commitment to a counter-cultural lifestyle, it IS possible to live debt-free in America.
Are you debt-free? How did you pay all your consumer debt off?