I think we can all agree: Debt sucks. No one wants to be drowning in debt or stressed out about money, but somehow, almost all of us end up there. Students loans, credit cards, vehicles, mortgages, etc… It’s easy to get into debt, and it is so hard to see the way out once we’re there. Debt becomes our new normal. We work more hours, get more jobs, and then buy more stuff. It’s an awful cycle. Many people start to think of the price of new items in terms of monthly payments, rather than how much the total item costs.
Just talking about it makes my chest feel heavy. We all prize freedom, yet where is the freedom in debt? Proverbs 22:7 says, “the borrower is servant to the lender.” Some translations use the word “slave.” Doesn’t it feel that way? We are slaves to our lenders – and if they don’t get their payments each month, we have even bigger prices to pay as a consequence.
But why are we even talking about this? Isn’t everyone up to their neck in debt? Isn’t that just the norm? What’s the point of getting out? I mean, all this stuff I’m in debt for is supposed to make me happy, so I’ll just keep buying it.
Now, I am not going to say that everyone should always avoid all debt at all times. I believe that when you weigh the options, some things may actually be worth getting into debt over – like education, or your home. Different people are in different circumstances and have different desires. So I’m not going to sit over here on my high horse and pretend like I have the answers for what everyone should do. It’s totally your money, and it’s not my place to judge what you do with it. Really.
But for those of you who WANT to get out of debt, know that it IS possible. And you may be able to become completely debt-free faster than you think. So I’m going to tell you how we paid off $80,000 of debt in 2 ½ years. For real! And it’s not because we have big paying jobs. My husband is a teacher, and I am a stay-at-home mom. We are NOT swimming in cash over here.
2 ½ years ago, we built a house. Our new mortgage ended up being about $133,000. 2 ½ years later, we are down to $53,000. Here are 9 things that helped us get here:
Create a Budget
If you don’t have a budget written out, do it now. Do.It.Now. You may think you are doing an OK job of keeping your spending under control without one. I can almost guarantee you’re not doing as good a job as you think. Track your spending – EVERY penny – and see how much you need for each category. Then cut it down (please don’t cut down your tithing, if that is something important to you) and set goals. Continue keeping track of everything, and adjust as needed. It may take a few months for you to get a handle on exactly what your numbers need to be, but start the process now. It is AMAZING how much little things like fast food can add up to. Take your lunch to work and save $150/month.
There are a ton of free budget templates online. Here is a simple worksheet I found: Budget Worksheet Form
If you’re a spreadsheet person, like me, you can make your own, or maybe use one of these: 10 Free Household Budget Spreadsheets
Make it a Game
Have fun with this! Challenge yourself! Saving money and cutting back does not have to be dreadful. I feel like it’s a fun contest to see if I can beat myself by spending less in certain budget categories each month. Make goals and visualize your “why” for getting out of debt. What would you do with all that extra money, if you didn’t have those monthly payments?? Go on vacation? Retire early? Give more? Spend more on your hobbies? If you are a super visual person, you can even create a “vision board” with pictures of your goals to remind you of why you are tightening up now. As Dave Ramsey says, “Live like no one else now so later you can live like no one else.”
Stop Spending Money on Stuff You Don’t Need
Do you really need cable TV? No. It’s really expensive and it rots your brain. (Okay, to be fair, I am no stranger to binging on Netflix. But at least it’s WAY cheaper!) Get a cheaper cell phone and plan. We use Cricket Wireless. We have awesome service, decent smart phones, and pretty cheap plans – with no contracts or extra fees. If you have cell phones, ditch the landline. Do you have magazine subscriptions you don’t read? Waste of money. Don’t eat out so much. We maybe go out once a month, including fast food. If we go out more, it’s because we somehow got it free. It’s healthier to eat at home, it’s way cheaper, and facilitates family time better. When you do go out, use a coupon!
Spend Less Money on Stuff You Do Need
When was the last time you shopped around for car/home insurance? Or internet service? Sometimes you can save a lot by switching, and it’s so worth the time on the phone to find out. Buy less clothing, and when you do need it, buy used. Resale shops can have awesome stuff for WAY cheaper than retail. Even when you combine sales and coupons, new clothes are usually way too expensive for my taste. This goes for adult and kids clothes, including shoes and accessories. Most people have way too many clothes in their closets anyway, so just stop buying stuff (even cheap stuff) unless you need it.
Sell Your Stuff
Go through your house and get rid of stuff. Be brutal. Believe me, you won’t miss it, and you’ll love having the extra cash. Do your kids really need THAT many pairs of shoes, when they refuse to wear anything but their favorite pair anyway? Do YOU need that many pairs of shoes? No. Declutter every room from top to bottom and you’ll have a cleaner house and more money. Win, win!
Search for Deals
My husband is awesome at this. Just yesterday, he came in and asked, “Do you want pizza for dinner? It’s free.” Combining coupons and his awesome deal-finding skills, we fed our family of 5 with carryout pizza for 58 cents, and had leftovers, and I didn’t have to cook or clean. *swoon* He speaks my love language. His favorite go-to site for finding deals is Slick Deals. He also checks out all the grocery ads and we stock up on sales – like meat, cheese, and blueberries – all which you can freeze for later. I don’t coupon a lot because I think it turns out being a waste of time and money a lot. But I do use coupons for diapers. I use Amazon Prime to get deals on toiletries and vitamins. We almost exclusively go to Aldi for our groceries, because it is cheap and quick and awesome. I am in love with Aldi. We participate in kid’s clubs and birthday clubs at local libraries, restaurants, bookstores, etc. These can get you coupons for lots of different free activities and foods. Searching for deals can take extra time, but it can save you lots of money, and give you the ability to do things free, like eating out, that you may be cutting out of your budget.
Do Free Stuff
You can still have fun and experience lots of things without spending lots of money. Go to community playgrounds. There are lots of free places to hike and picnic too. Places like Home Depot and Lowe’s have free workshops for kids and adults. Museums have free days. Libraries have tons of free programs for all ages. Go for a walk or a bike ride around your city, neighborhood, or riverfront. Some communities have free splash parks, or pools for summertime fun. Communities and businesses offer free events all the time, so just get out there and search for them. You’ll gain new experiences and have lots of fun – for no money at all! Remember to pack your own lunches and snacks! 😉
Get a Side Hustle
There are always side jobs you can take on to make extra cash. Your time is valuable, so you don’t want to take on ALL the jobs, but it can be super helpful to earn even $20 a week extra. Tutor. Clean a house. Mow a lawn. Babysit. During the time we have paid down so much debt, I started growing a direct sales business, which helped a lot. Just make sure you don’t waste your hard earned money; instead…
Take Your Newfound Loads of Cash and PAY DOWN THAT DEBT
It is SO much fun to see the principle balance on your loans decrease. It’s like a party every month. Many wise financial advisors say to work hard to pay off your lowest debt first. Then take all you were paying on that loan (the payment amount + whatever extra you were paying) and put that as extra on the next lowest until it’s paid off. Then take all that money and put it on the next, and so on. Your debt will fall off faster this way, kind of like a snowball!
Then CELEBRATE because you are DEBT-FREE!!!!!! You CAN do this!!!!