It took about 2.5 years to get completely debt free!
Anyone can do it! We support you!
It was a long war with lots of battles won and lost. There was sacrifice and celebration, and lots of changes to our life (almost all good). In the end, I would do it a million times over.
Conquering such an insidious foe, becoming completely debt free, and the feeling of freedom and confidence that gives is invaluable!
It definitely wasn’t easy, but it also wasn’t that hard.
Here’s a list of all the things we did in the process to become debt free:
- Began using a budget and tracking expenses
- Took a personal finance course (Financial Peace University)
- Moved in with a roommate (we were 1 year into our marriage!), also we were super picky and ended up with a great fit
- Got a job (was unemployed at the beginning of the process)
- Got a better job (actually did this twice during the process)
- Got a raise (work hard, know your skills, know your value, ask)
- Sold stuff (guitars, video games, etc.)
- Got a cheap car ($1000, from a family member, paid in cash, and still driving it!)
- Rode bike to work (which I loved doing anyway, didn’t buy a new bike)
- Cancelled all subscriptions (except Netflix and Amazon Prime)
- Virtually eliminated online shopping
- Bought very few books (used physical and digital libraries), still got to read tons of amazing books
- Virtually eliminated eating out (brown-bagged every lunch for a year or two, ate out maybe once a month)
- Minimized trips and travel (although living in the Pacific Northwest made this very easy as we could hike, swim, bike, and go to festivals to our hearts content. Also, got to travel for work during this time, very lucky, all of these things made this pretty easy. Hardest part was not visiting family as much as we would have wanted.)
- Lived without a couch or TV for about two years (easy to get used to actually, again, easy in the PNW).
All of these changes seem huge, but we took each a step at a time and after some time, adjusted. (There’s a lot to be said here of “hacking” ‘hedonic adaptation’. Basically, there’s a vast potential for humans to adjust to change. That, coupled with: “knowing your why can empower your how”, allows for great things to be accomplished over time.)
Luckily, humans have a tremendous capacity for adapting. We leveraged this and actually accomplished the highest quality of life up to that point in our lives.
This is “hedonic adaptation”. With some mindfulness and intentionality, you can use this concept to create the life and habits that move you towards your goals in life. Time will normalize almost all conditions.
No eating out meant getting really good at cooking awesome cheap homemade food.
Biking around town and to work was extremely healthy and fun. I got to see totally new parts of the city and meet lots of new people (and lose weight and get into better shape). Also, our social lives exploded as it is way more common to run into people when you’re biking, and you can be way more flexible without lugging a car around. (PS – you will never get a ticket for parking your bike to hang out with friends longer, or for parking your bike overnight, etc.)
Not spending meant meant cultivating content for what we had. No couch or TV meant that we were out at the beach, picnicing at the park, hiking in the woods, camping on a mountain, or sleeping at home.
Not having an expensive car or bike meant totally stress free travel (rocks hitting the car, a ding here or a scratch there, who cares). We ended up being out with friends and doing cool stuff all the time because home was pretty much for eating and sleeping. We worked harder at work and negotiated much better because we truly knew the value of a dollar. Not taking on debt meant, if we wanted something (car, mattress, laptop, phone, etc.) we had to save that money up (not just put everything on payments, get stuff impulsively, then slowly drown in monthly payments (again)).
When it takes a month or two to save for purchases, shopping decisions change, with time to think and ask around. Usually, that means buying something that’s a better fit (or not at all as you realize you must not need/want it that much if you can go without it for a few weeks/months). We find that the big savings target gets smaller the longer we save as we decide well be content with a used bike sooner than saving longer for the new bike (it’s always better to love something used than like something new).
It was an amazing journey.
The cherry on top of it all is ending up debt free with a super low cost of living! Once we were debt free, we bought a few things almost immediately (after saving a “fully funded emergency fund”, which again, didn’t take long because we had so much “extra money” each month due to eliminating massive debt payments and having a super low-cost lifestyle). A new bed (a super nice one, it’s amazing), TV and couch, new clothes, some little weekend trips, and a new bike (my absolute dream).
Because we had built a lifestyle of activity, the couch simply added a place to rest during the week and weekends, the TV adding a huge screen to our movie nights (no more iPad movies). (PS – We store our TV in the closet and only bring it out for move nights, sports events, etc. This keeps the default activities: talking, reading, writing, drawing, thinking, day-dreaming, etc. Keeping things you want to do accessible is key: the guitar is our and tuned-up, the typewriter is loaded with a fresh blank sheet of paper and awaiting your fingers…
…
Keys to Getting Our of Debt:
First, believe. The body cannot do what the ind believes is not possible.
Start with the end in mind: believe it is possible.
Start by addid up all debt and getting “the number” (Don’t Panic!). Then, start using a budget, tracking spending, and slowly chipping away at the smallest debt by balance (the “debt snowball” method. Careful whose advice you’re taking. Almost everyone has “advice” about getting out of debt, but almost no one has actually done it. I highly recommend only listening to people who have gotten out of debt and stayed debt free). Our “number” was huge (to us, everyone is different). There were about 10-12 debts (about 10 student loans (~$2,000 – $6,000) and two credit cards (~$3,500). Because we hated the credit cards the most, we started there, but in general, followed the debt-snowball method of paying smallest balances first.
This much is for sure, whatever “method” you follow, celebrate every inch towards your goal, however it comes (even if you find $5 on the street and put it towards debt, celebrate!).
It was very slow in the beginning.
(at least it was exciting!)
In the beginning, it’s all new stuff: new habits, new ideas…. The process front-loaded: changing jobs, getting a roommate, moving to a cheaper place, etc.
Once budgeting took hold (three months or so), the money starts to pile up, seemingly from nowhere. Somehow, simply seeing and knowing where your money is going feels like a super-power, allowing you to direct the flow at your will. It’s like operating a hose of money through a spreadsheet, a little planning, and disciplined decision making.
Then there’s always the middle…
For us that meant months of minimum payments. That meant for all our training and hard work, we found ourselves walking during the marathon. This is where perspective, a support system, and celebrating every inch comes in handy. Realizing how far you’ve come is a great way to build confidence, contentment, and gratitude. This is your fuel as you perform below your expectations. The support system keeps all of these habits front of mind, to stay mentally and physically healthy during this long journey (like any journey towards goals, etc.). Finally, celebrating every step, every inch, every breath, puts the focus back on what we can control: the tiny bits of effort and progress, however small, that are propelling us towards our dreams, expectations be damned.
Go get it!
Good luck and have fun!
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