Our Debt Free Story

On my birthday, March 7th, 2018, I sat on the floor in our tiny home office that I would soon be converting into a nursery. I had a notebook, a calculator, pen, and too many bills laid out in front of me. I can tell you it was chilly that morning, typical for early March, and my cup of coffee felt nice and warm in my hands as I took sips in between punching in number after number into my calculator. My pen scrawled out every new debt total in a new column next to my budget which was getting tighter and tighter. My husband joined me a few moments later with his own cup of coffee. He sat down on his computer chair and asked what on Earth I was doing. I told him All of these bills kept coming and asked why none of them had been taken care of while I was working. I had just returned to being a stay-at-home mom a few months earlier and was backtracking over 3 years worth of debt that had never been paid. He said something about not knowing if I had paid them or not and how they either sat on the table or were tossed out. Angrily, I went back to the never ending task of adding up more and more bills. When I came to a grand total of over $30,000, I made another full page of debt totals, this time by category; Medical, Student Loans, Car, Electric, Water, Gas, and Other. "Well, how much?" My husband asked, now interested. "Over $30,000..." I felt like the room was closing in on me. "Oh, that's not bad at all! Plenty of people are in over $300,000 or even a million!" I stared at him blankly. How could anybody think $30,000 was nothing to be concerned about while on an income of less than $60,000 a year? How were we going to bring a new baby into the world? How were we ever going to be able to afford a life while paying this mess off? Where should we even start? I already had a budget for every paycheck. After bills and food we were lucky if we had $80 left for gas. Now what?

I dug through every mommy blog I could find, every Millennial money channel, every budget page, and then I kept seeing a pattern in the comments; Some guy named Dave Ramsey. The name showed up video after video, blog after blog, it finally clicked that I should maybe check this guy out. I found a few videos of him and was quickly turned off after seeing him bringing up Financial Peace University. I felt like he was just trying to sell me a program and a book. I continued my search for the "right" solution. By the time dinner came around I had this nagging voice in the back of my head saying I should give that Dave Ramsey guy a chance. I found his channel and listened to a few calls, then a few rants, and then I binge watched for 2 weeks nonstop.

My husband came home from work to see me sitting on the floor, yet again, this time surrounded by all of our DVD's, a pen and paper, and my phone which I was using to scan the bar code on every single DVD. "What are you doing?!" To say the least, he wasn't happy. I said I was selling everything we had, including the DVD's. Everything that wasn't nailed down in this house besides our oldest son and our cat, everything else was going so we could start to pay off debt. He thought I had lost my mind, and said to just pay the minimum on everything and we would be okay. "How? We don't even have the money for the minimums." He got quiet and left the room and I resumed my task of bar code duty. We only received about $30 or so from Decluttr, but it was a start to our $1000 Emergency Fund!

I listed my debts from smallest to largest. Every pay day I would put as much as I could on debt, even if it was $1 - and sometimes it was. Yet somehow we started making progress. When our first debt of only $75 was paid off, I felt like I could have cried. I began calling the next collector on the list to see if they would settle or make some sort of deal with me, to my surprise, most were willing to settle and take what they could. One by one those debts were crossed off and our total debt amount was dropping. After selling everything I could, I was able to pay off almost all of my student loans and the remaining amount was taken care of via tax return - I did cry on that one! We were no longer making $1 payments, but $10, and then $20, and then $50, and then $100.

I used my small art business, resale, coupons, cash back apps like Ibotta, and must have logged onto our bank website at least 5 times a day to keep a tight leash on our money. We kept a tight budget of $150 or less for groceries bi-weekly, this meant a lot of potatoes, rice, spaghetti, ramen, bread, and Great Depression recipes. We made "radical" moves like cancelling cable, changed our insurance company, skipped buying new phones, new clothes were a myth unless they were given to us for free or were an absolute need like underwear and socks, in which case Family Dollar or Wal Mart were my go-to's. Decorating for Holidays meant Dollar Tree and Diy crafts. Christmas consisted mainly of Goodwill, Dollar Tree, Wal Mart, and even Wish. When our second son was born that meant breastfeeding, cloth diapers, hand-me-downs, and homemade baby formula when the time came. With all of this, we were able to make more and more progress on our debt. My husband got raise after raise and suddenly money seemed to be working for us for once. By the end of our debt, our big bills of over $400 or even $600 were paid in full all at once. Our final bill was our car note, and I attacked it with everything we had and managed to get it paid off a few months early - I cried even harder on that one. For two years it was a nonstop uphill battle of clawing our way out of debt, when the occasional bill does come our way, we pay it off quickly. This is an ongoing journey, and through it I've become a minimalist, meaning I only keep what we need and what brings us joy, this cuts down drastically on mindless spending as well. I cook everything I can from scratch and know how to do a ton of Diy money saving projects. Frugality has become a way of life. Once you realize $1 can be the difference between a $30 overdraft fee at your bank or being positive $1, all of a sudden everything gets thrown into perspective.

The only part of the plan we haven't followed thus far is we did end up opening 2 credit cards, one for me, and one for my husband, with only a limit of $200 on each. I put one Christmas gift a pay on mine and pay it off every pay day, and my husband uses his for the vending machine at his work and sometimes gas, we never use over 20% and never carry a balance. Because of this we are now able to buy our first home and start a new chapter in our lives.

This plan works, we are living proof and so are millions of others from around the world. Dave Ramsey has changed our lives forever.

Thanks for reading!

Amanda