We Paid Off $75,000 in Debt in 24 Months

You have to decide when enough, is enough

We had every kind of debt imaginable, student loans, car debt, and credit cards out the wazoo. It’s really surreal to even write this, but we actually paid off $75,000 in consumer debt. Impossible, you say, no, it’s really possible.

We are not perfect; after the Great Recession and a divorce, I lost everything with bankruptcy to prove it. I was on a cash basis because I had to be. I eventually remarried and became normal again. You want to have a good credit score, right?

Together we created new debts, while health issues put our income at new lows. We survived through some tough times and were no strangers to a food bank. Through my encouragement, my husband went back to school and found assistance through the VA.

Our financial situation turned around when both the VA and disability were approved. At the same time, I got a better job. You don’t have to stay in the situation that you’re in.

You have to decide when enough is enough

When you go to the grocery and your debit card is declined, maybe that’s the wake-up call you need? The first step to being debt-free is to quiet all the chaos. Only you can decide when you’re ready to say no more.

Don’t pay the credit card first and worry your lights will get shut off. Create some peace in your own home first. Prioritize the roof over your head, utilities, groceries, and gas for the car.

Do you have one?

Okay, I won’t say it, but cash, do you have a cash fund? For you know, an emergency? I started carrying a couple of dollars in my wallet. Then I traded them in for a five-dollar bill. Today I have a twenty, just because. It’s not much to you but priceless to me. Today I can gift my granddaughter just because.

We maintained $1000, and we used it when we had an emergency. 47% of Americans can’t come up with $400 for an emergency. It’s interesting, but after you have it — the emergencies aren’t life-shattering. If we needed to use some of our funds, we stopped paying down the bills until they were replaced.

Stop using credit cards.

The only way to pay them down is to stop using them. It’s simple to say, much harder to do. Do you want to keep paying for your past or save for your future? Take them out of your wallet. Use your debit card or cash instead. If you want to be debt-free, say no to yourself.

Debt is emotional spending.

“Money is 80% behavior and 20% head knowledge” Dave Ramsey.

If it were easy to be debt-free, everyone would do it. If it were easy, we’d have done it twenty years ago, or even ten. We were a one-income household for many years. It was all we could do to survive. Buying something makes you feel good; seeing the bill afterward doesn’t.

Do you want to live paycheck to paycheck for the rest of your life?

Take twenty-four hours and think about a purchase first. What are you giving up for it? Have you ever gone car shopping and they ask how much can you afford a month? They want to know how to appeal to your emotions. If you say three hundred, they’ll show you something that’s four hundred, and then you really want it, don’t you?

We stopped to look at minivans several years ago. We never really stopped; we just slowed down and drove around window shopping while the used car salesman followed behind us, waiting for us to stop. I still wonder how many laps he would have done around the lot, but I digress.

Create your budget

When you start a diet, you think you don’t take in as many calories until you write them down. A budget is the same. Take a week and write down everything you spend, every foo-foo coffee, every kid’s meal. You’ll be surprised at how much extra you spend and how much you could use that to pay off your debt.

Make a plan or a budget. Find a budget app, use a spreadsheet, or even old-fashioned pencil and paper.

List your income, then list your debts smallest to largest. We paid the minimum on each bill first. Any extra money went to the smallest bill until we paid it off. You need to see that little victory. Then you move to the next smallest, paying the minimums and putting any extra money on the balance.

When we paid off the car, we really knew it was a possibility, giving us the motivation we needed.

Sell an asset

A pandemic didn’t hold us back; it pushed us forward. We decided to sell our rental property after our daughter moved out. We paid minimums on our bills and used cash to fix up the house. New floors, fresh paint, and a few remodeling projects, and two months later, the house brought multiple offers and sold on the first day.

We’re now debt-free except for our house

We paid off $75,000 in debt and stopped living paycheck to paycheck. I still look at that and think it’s someone else, almost like reading all those get-rich-quick schemes.

But it wasn’t quick, and it wasn’t easy. It is possible, it’s up to you, and you really can do it.

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