This author and her spouse paid off $85,000 in debt. Discover their secrets for getting out of debt.
- Posted on Aug 1, 2016
In 2007 I was a newlywed college student who had just returned from a honeymoon in the Caribbean thanks to Mastercard. Upon our return from the sunshine, my husband and I sat down and decided to practice being adults by outlining a budget. The numbers stopped us in our tracks. We were barely making ends meet. And we had debt. Lots of it.
Debt is not the most blissful way to begin a marriage, but, I suspect it’s a reality for more than just us. With roughly $85,000 owed towards our educations and various creditors we were at the bottom of what felt like Mt. Everest. The question was, do we start the difficult trek up now or do we ignore our financial mess and let it poison us later?
In the 3 years that followed, we significantly changed our money habits. Many of our changes were thanks to what we learned in Dave Ramsey’s Financial Peace University course. Bottom line, paying off debt is all about sacrifice. Spending less allows you to pay off more, more quickly. And we committed to that. For 36 months, we chose to rough it in order to find financial freedom.
If you’re feeling the effects of your own debt mountain, trust me, I can easily recall the stress of your circumstances. Debt binds you and instills fear and worry. The “freedom” that credit and low interest provide in the beginning later turn out to be the very shackles that keep us from fulfilling our dreams. Without debt, what would you do? Would you travel more, work less, help out a family member, buy something you’ve been wanting without guilt? Paying off debt and working towards debt freedom opens all those doors. And that’s why I’m excited to share 7 ways you can start paying off debt now.
1) Save $1000 and Then Cut Up Your Credit Cards
Saving what Dave Ramsey calls an “emergency fund” gives you the cushion and peace of mind you need to start living on a ruthless budget. Cutting up your credit cards eliminates the crutch that could put you into more debt. To move towards debt freedom you have to change your perspective of money. Credit cards don’t save you, they hinder you. Say goodbye to them.
2) Have a Plan
You might need to take a class or meet with a financial advisor (one who isn’t trying to sell you something) to really get the debt-pay-off ball rolling. Do what you have to do to make a plan AND EXECUTE IT. From the very beginning, we knew that if we could save or earn an additional $1000 a month we would be out of debt in 4 years. Thanks to our daily sacrifices, job changes, and a small inheritance we beat our goal!
3) Get Savvy About Your Utilities
It takes a little time, but shopping around for the best prices on cable, internet, and phone can save you hundreds each month. Maybe even consider giving up cable or your fancy phone for a time.
4) Reign In the Food Budget
Food is a necessary expense, but there are many ways you can reduce how much you spend each month. Kick off meatless menu days (meat is one of the most expensive things at the grocery store), learn to coupon, grow your own produce, buy in bulk when it makes sense. One thing that was huge for our family was cutting the amount of money we spent on beverages. My husband gave up soda, I cut my morning juice habit, we rarely if ever bought alcohol, and we drank drip coffee brewed at home. Basically, water became our best friend and we paid off debt with what we would have otherwise drank.
5) Become a Seller
I’d venture to say that half the things you own, you don’t need. If you think you can sell one item a week and put that money towards debt, I’d say, “Go for it!” Between Craigslist, Offer Up, and eBay I’ve learned the ropes of earning extra income in a jif. My favorite tip though? If you have something to sell, post it on your Facebook page with a family/friends price. There is nothing better than selling to someone you already know and trust.
6) Learn To Say No
No, we can’t go out to eat, but we’d love to get together for homemade pizza. No, we can’t go to the movies on Tuesday, but if you’d like to join us for a Redbox, we’ll pop the popcorn! No, we aren’t going on vacation this year, but our kids are sure looking forward to setting up the tent in our backyard for a few nights. Saying no doesn’t mean you’re giving up all the fun, it just means you’re teaching yourself to have fun without spending a ton of extra money.
7) Forget What Others Think
You don’t drive the nicest car? Who cares. You exercise outside or at home with a YouTube video instead of at a fancy gym? Not a problem. Your Christmas looks meager compared to others? Um, is that even what Christmas is about? Keeping up with the Joneses is so last year. Paying off debt? That’s what is cool these days! Do it now and do it with a smile on your face. Adulting is hard, delayed gratification isn’t always fun, but the rewards are great and you are worth planning for a future with less money stress.