How to get out of debt: We paid $26,619 with one tool! - Debt Free Forties (2024)

Racking up debt can happen for a variety of reasons: overspending, medical issues, a car accident, a layoff.

Often it can take just one or two unplanned instances to end up neck deep and struggling – especially if you’re already living paycheck to paycheck.

Millions of Americans are one paycheck away from accuring more debt, or worse – bankruptcy.

My family has been there. We’ve struggled with worrying about going negative every month and using the last small bit of savings we had to stay afloat. Forget figuring out how to eliminate credit card debt on top of that.

We didn’t spend lavishly or have fancy cars and clothes. But we did spend foolishly, by not keeping track of what we had coming in versus going out.

Not to mention we were so disorganized and constantly playing catch up in all aspects of life, including our money.

It doesn’t matter why you have debt – what’s important is that you’re ready to learn how to get out of debt and have the tools you need to finally become debt free.

In this article I’ll outline step-by-step how we officially, finally became debt free (hooray!) and the tools and tricks we used to get there.

Struggling to pay off your debt is no way to live. Why not make this year the year you finally drop the burden of debt once and for all?

5/01/18 Update: We’ve now paid off $26,619 of debt in just 17 months and raised our net worth by $57,952!

Our Steps to Being Debt Free

My husband and I had accrued various types of debt for almost 20 years. We were struggling to figure out how to get out of debt and stay there. While we weren’t necessarily drowning in debt, we weren’t killing it in savings and investments either. Just a lot of living for the day and never setting any financial goals.

Most of our debt was from life in general. Student loans, two costly births, a car wreck, credit cards, home improvements. Having a house on the market for almost a year after moving to a new state certainly didn’t help.

We finally sold our house when we had $700 left in savings to cover the next month’s expenses. The term “living beyond our means” couldn’t have more accurate.

All these decisions we had made stacked, and stacked, and stacked – until I realized just how dangerously everything was teetering.

It was like a bunch of wobbly teacups stacked in angles on top of each other, just waiting for a tiny push to topple them over. I began to realize just how one tiny thing, like a job loss, could topple everything and break us financially.

We needed help getting out of debt, and fast.

Deciding to Get Out of Debt – for Good!

Finally, in December of 2016, I realized that I want to do so many things with my kids – like traveling – but I wasn’t following through on any of it. I always had the excuse that we didn’t have the money, or that we’d do it after we paid off our debt. But we had no solid plan of how to get out of debt.

Even more importantly, I began to see that my parents were aging. Time was slipping away from all of us, and that we aren’t guaranteed tomorrow. It’s wonderful to see that my parents have taken care of themselves financially, and I realize that I want the same when I hit retirement age.

Call it a mid-life crisis, a change of heart, whatever you want. As I faced the fact that I was nearing 40, I realized that what I really needed in life was time with my family and financial independence (though a vacation or two wouldn’t hurt either!).

Once we made up our minds to get out of debt, it couldn’t happen fast enough. We wanted to learn how to get out of debt quickly, but didn’t where to start that would make it finally stick.

Our biggest financial downfall was our lack of setting actual, concrete financial goals. The other was that everything around us and our household was chaos. Without having goals and backup plans for when things went wrong, we just couldn’t seem to stay on track financally.

The Budgeting Workbook that Changed Everything

At this point, I’d been following a lot of personal finance blogs and gurus, reading tons of books and taking very small steps towards making changes.

I read everything from Dave Ramsey to Suze Orman to Gail Vaz-Oxlade to learn how to get out of debt quickly.

I wanted to learn how to get out of debt fast. I didn’t care how, I just wanted results. But none of the methods really stuck.

Then, I found an awesome budgeting workbook that made everything finally click. It was unique and not quite like any budgeting tools I’ve tried before. It taught us the best way to get out of debt with small, detailed steps.

And not only did it give detailed steps on organizing your finances and getting out debt plan, but it had challenges to learn new skills that would support those goals.

The 90 Day Budgeting Bootcamp Workbook broke the budgeting process into 12 weekly challenges. Each week, we took a small step to tackle our budget. One week it was pulling together our bills; another was creating our budget. One weekly challenge involved setting up an emergency fund, and another was about participating in a spending freeze.

Each weekly challenge was like adding a new rotation to our debt payoff plans. We started out easy, then once we felt like we had conquered that, we moved on. Some challenges we completed quickly, while we took more than a week to accomplish others.

We learned to set goals, create a pay off debt plan, and how to use our money to get rid of quickly quickly. But why did this budget work so much better than the others we’d tried in the past?

Why this budget worked better than others We’d Tried

These debt payoff plan worksheets helped us to learn how to eliminate debt by helping us become better organized. The bootcamp was a holistic approach to a common but complicated problem.

Rather than just answering the question of “how can I get out of debt”, it helped to build a strong foundation and skills to support the goal of getting out of debt.

For example, by creating organization and routines in our daily lives, it helped to stop excess spending. By sharpening our skills and putting routines in place, we were able to support our goal of spending less.

By spending less, we then had extra money to reduce and finally get rid of credit card debt – for good.

Any financial guru can give you a budget to follow. But it’s following a multi-step plan of attack that helped to create the best way to eliminate debt for us.It supported our efforts and helped us to build skills to reach those pay off goals.

Our Debt Repayment Progress

I pulled our belts TIGHT. I’m not kidding – everything that wasn’t a necessity was gone. Cable, switching to Straight Talk for phones, cutting down on insurance (but still being responsible). I even contacted our daycare to see if we could get any “good guy” discounts. Asking for a discount from anyone at this point became a challenge rather than an embarrassment.

We originally had $52,593.00 in debt when I add up the starting amounts of all our of current debt. In December 2016, we had paid it down to $26,619.26. So we buckled down and busted our butts.

And then my husband got laid off towards the end of April 2017.

Rather than feel sorry for ourselves, we choose to just barrel on through and continue on with our debt payoff schedule.

It was frustrating and irritating and everything else, but we put that into making sure we finally stayed on the path we chose rather than to make our mess even bigger.

Thankfully he found a new job at the beginning of July. We have paid off over $12,324 in 8 months $26,619 in 17 months now, all while my husband was unemployed for two and a half months.

Other “super fun” bumps in the road during this period included paying a $1,000 deductible after storm damage to our roof, as well as paying over $800 back to our FSA from his last job. It truly goes to show that having the right mindset, determination and support system, you can make anything work.

How Our New Budget & Paying Off Debt Has Changed Our Life

We’re on track to have the rest of our debt (a car loan and my student loan) paid off as of April 2018, just 3 months shy of my 40th birthday. I couldn’t be prouder of our progress and can’t wait to take a (cash paid) vacation to celebrate both milestones!

Now that we’ve completed the workbook, I look forward to doing our budget and tracking our spending. I don’t avoid or ignore it anymore, hoping it’ll just go away. Every month I print out net worth and budget pages so that I can see how far we’ve come. I love checking our progress at the beginning of every month and seeing how our debts and net worth have changed!

Instead of wondering where our money went, we give it purpose and direction. We have goals set that we’re working towards and are actually achieving! As I mentioned, we’ve already paid off our credit card debt fast as well as my car loan. Needless to say – we’re really motivated to get rid of our debt, once and for all now!

About the 90 Day Budget Bootcamp Workbook

This $7 budgeting workbook usually goes for $27 but is on sale for a limited time! Features include:

• 60+ pages of exercises and step-by-step instructions to build and hone your budgeting skills
• 14 challenges to teach you budgeting, time management, and how to change your perspective when it comes to your money
• A private Facebook group where you can find like-minded people who are on the same debt-free journey (I love contributing and bouncing ideas off the folks in this group!)
• Tips on how to streamline your expenses and trim your budget to stretch your dollar as much as possible
• What to do if you’re behind on bills and how to catch up quickly
• How to budget for the fun stuff
• Where our spending weak points are, and how to avoid them
• How to plan and budget for upcoming expenses in the months ahead
• Calculate our net worth and debts, so we could easily measure our progress
• How creating a schedule for your home life can affect your financial life (in a positive way!)
• How to budget for infrequent purchases such as vacation, holiday gifts, etc.
• How to slash our grocery budget, which was a huge problem for us
• How to work together to not only set financial goals, but to CRUSH them!
• Plus TONS of other tips!

If you’re stuck in the debt cycle can’t figure out how to get out of debt, I cannot recommend the 90 Day Budget Bootcamp Workbook enough. It is well written, has beautiful graphics, and is easy to understand and work through. It’s the only way we’ve ever been able to create a budget and stick with it. It’s definitely worth the $27 $7 and then some!

Now that you’ve learned about our budget, here is the list of items we cut in order to save money on our tight budget. Read11 easy ways to save money on a tight budget to learn more about the super easy methods (like using Truebill or Trim) we used to save money and reduce debt fast!

If you have any questions about how to get out of debt or the 90 Day Budget Bootcamp Workbook, comment below or email me at info@debtfreeforties.com! I’d love to share more tips and information about the challenges, the private facebook group, or the budgeting concepts discussed in the workbook. I’d also love to hear your stories of how you’ve eliminated your debts. Just give me a shout below!