Tell us a bit about yourself
My name is Ruth, and I live with my husband (DH) and two of our three daughters. Our eldest has grown up and flown the nest. I work as a high school teacher, and my husband runs a home business.
What was your debt at its highest? What did that debt consist of?
We acquired our unsecured debt of $102,200 very unconsciously at first. Debt has become so normalized in our culture that we didn’t blink as we took on debts for cars, furniture, some travel, meals out, a variety of consumer purchases, and a mortgage. We had no stress about our debts. We carried them well, paid off more than the minimum in terms of monthly payments, and almost never carried a balance on our credit cards.
Things got stressful when DH gave up on his career as a professional engineer after the high-tech bust of the early millennium. He’d been on a job roller coaster for 5 years as one company after another went under, and he stepped off the ride in 2003, in need of a new direction. It took 6 years for him to settle upon his path, and in 2009 he officially launched a home business. The good news is that it has been a great success! The bad news is that after his 6 years of extremely low income and after taking on a line of credit for the very significant expenses involved in starting the business, we were in deep debt.
Our debts were:
Debt 1 & 2: Both were lines of credit for cars, a course DH took, and a pure-bred dog (I know, I know.) – $21,400
Debt 3: 1 line of credit for the business – $80,800
What did it feel like to have that much debt?
For the first couple of years after DH’s business was launched, we just felt so happy to have a solid household income again, and we began drifting back into our old spending habits. More meals out. Expensive gifts for our daughters for birthdays and Christmas. A house cleaning service every 2 weeks. A bit of travel. A new car. But it just didn’t feel right.
We couldn’t identify the root of our uneasiness until a friend of mine came by to drop off a book CD entitled The Total Money Makeover, by Dave Ramsey. Debt! It was our debt that was causing our uneasiness. In June 2012, a month after having listened to and read (yes, we did both) Ramsey’s book, DH and I, unified by a vision of financial freedom, took the first step in our journey out of debt.
How long did it take you to pay it all off?
It took six months of gazelle intensity for us to pay off Debt #1 and Debt #2. We were incredibly encouraged to have knocked off our two smallest debts so quickly! Debt #3 took much longer to pay off – 30 months and two weeks to be exact. We put the final payment against it on June 13. 2015. So in total, we paid off all non-mortgage debt in 36 months and 2 weeks. (We still have a mortgage debt of $128,000).
What resources did you use to help you through this process?
If it hadn’t been for our reading of The Total Money Makeover, we never would have begun our debt-payoff mission. We would have continued waffling with that underlying sense that something wasn’t quite right. We would have continued to carry that stress and source of conflict, blind to the constraints imposed by our “normal” debt. We’ve gone back to The Total Money Makeover many times in the months – now years – since we first read it. I can’t recommend it enough as an honest, clear guide – one that succeeded in getting me to take my head out of the sand, wash out the grit from my eyes, and see the light. Does this sound overblown? It’s not. I, way more than DH, was stuck-stubborn in my denial of basic personal finance wisdom. It was no small deal to get me going in the right direction.
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Of equal importance to Ramsey’s book has been my almost daily reading of personal finance blogs. Debt and finances were never topics that I discussed with people. For my whole life – even growing up in my family – I sensed the taboo surrounding these subjects. Common financial wisdom like, “Don’t spend all of your money,” and “Be sure to save a portion of your pay,” seemed vague and boring – like a nag that I just blocked out. But once I was keen to become debt-free, I wanted to share my experience, gain understanding in areas of difficulty for me, keep motivated, and find out what others were doing to reach the goals I wanted to reach. The PF blogging community has provided essential support to me. I encourage everyone trying to get out of debt to connect online. Find the blogs and posts that speak to you. Put yourself out there by contributing to comments and discussions. That way, you gain an accountability that you don’t have when you’re doing it all on your own steam.
Did you face any challenges along the way?
Many! With DH’s variable income, we’ve never had a certainty that we’d be able to pay off a definite amount for any given time. We really had to take it month by month, and for some months, when business was slow, there was no repayment at all. It was tough for me to hold steady. I’ve been far too inclined to go up down emotionally with the ups and downs of our progress. I’ve gained an emotional maturity through it all.
I never realized how variable expenses can be until we started paying off our debts. Not only do we deal with the expenses of our household, but of DH’s business as well. We’ve gone through months of smooth sailing with very regular expenses. Then the van needs a repair. Or it’s time to replace the roof, and as we diligently save for it, our dog gets bladder stones AND our huge sugar maple tree out back starts dangerously dropping its branches and needs to be cut down. Ugh! So frustrating! I’ve gained an awareness of the changing landscape of our expenses, and I’ve developed some much-needed patience along the way.
There have also been many instances of conflict – either between the two of us or with one of our children (one in particular). I’m a peacemaker by nature, and so it has often been tempting for me to stop the angst by capitulating – by saying “Enough already! How much money do you want? Here it is.” I’ve learned to assert healthy boundaries through this journey out of debt.
Finally, I have really struggled to strike that elusive “balance” we all know is so important. Is it possible to work too much? Yes! Even if all of that extra income is going towards the noble cause of debt-reduction. It’s important to build in some room for rest and leisure – even if it means you say “No thanks” to an opportunity for additional income. Is it sometimes OK to spend on wants instead of needs? Of course! We’ve had to sort through the various influences that keep us unsatisfied and always wanting to buy, buy, buy; we’ve had to dig deep to find what it is that we truly desire in order to make value-based expenditures with confidence.
The whole question of progress with balance, given the uniqueness of each person’s situation, is addressed at a site that Laurie Blank of The Frugal Farmer and I recently started. The mission of Fruclassity is to give people support and a safe space as they sort out their own paths to financial health.
How did this affect your marriage?
DH and I are better than ever. I don’t say that to be peppy; I say it because other people have noticed that we seem to be happier and stronger in our relationship since we started our journey out of debt. We didn’t even notice. But it makes sense. DH and I are united in a shared mission, and because personal finances reach into every single aspect of life, it’s made us take a close look at every single aspect of our lives. The result? A better relationship. Who knew?
What were you doing for a living while you were paying off the debt?
As a teacher, I have worked in a high school library, and DH has been running his business. I have taught summer school for additional income since our journey out of debt began.
How did it feel once you paid it all off?
I’m still processing how I feel about paying off all non-mortgage debt. It’s so recent! I feel a certain lightness – like a weight has been lifted. I feel an expansion of possibilities – a new freedom. I feel a greater confidence. We’ve been wise! I also feel a strong commitment to the frugal lifestyle we’ve adopted to claim our financial health. Things are looking up!
What practical tips do you have for people looking to pay off their debt?
–Don’t do it alone! Although it’s almost impossible to have meaningful, ongoing dialogue about personal finances in real life, it is possible to find that support online. Get connected, and start your journey in the company of supportive people!
-Be ready to face your faults. Personal finance is not just about money. Not by a long shot. I’ve had to work on my impatience, my denial, my emotional immaturity, my aversion to conflict, my wishy-washy boundaries, and many other personal shortcomings. Drop your unhealthy pride and be prepared for a few humbling truths about yourself.
-Start by opening your eyes to your financial situation. How much do you earn? How much debt do you have? How much do you spend on needs? On wants? You must be able to answer these questions before you can take your first step towards debt-freedom. You can’t get to where you want to go unless you know where you are.
-Be encouraged! Every single choice that you make towards debt-freedom – wide awake and in a new awareness – will have a positive ripple effect. An impact that is greater than the sum of its parts. It takes time, but that time will pass anyway. Once it does, you can have the enormous satisfaction of having done something life-changing with it. Go for it!
Note: This is part of a series called “Debt Success Stories” which features people who were able to pay off a significant amount of debt. If you have a Debt Success Story I would love to hear about it. Please visit the contact page to let me know the details.