Saving money is always a hot topic- even more so now due to the recent state of our economy and post pandemic world. I think everyone is looking for ways to cut back at the pump and the grocery store. So this may seem like a strange time to discuss money strategies like paying off debt, but I actually think now is the perfect time! What highlights the need to be in control of your finances better than realizing there are forces outside of your control? So here is a look back at our debt free journey + 5 money saving ideas to help you reach your financial goals.
Digging the Hole
No one ever taught me much about money. We watched some Dave Ramsey videos back in high school. And I’m sure my parents probably mentioned some pointers here and there, but that was about the extent of it. In hindsight, the best advice I probably heard was Monica on Friends saying to save 10% of each check. But even still I heeded none of that.
Instead, I spent every dime I made the minute I started working. Okay, in all fairness I saved some, but if I wanted something, I got it. When I started college I took out student loans just like everyone else seemed to do. When I opened my bank account, I snatched a credit card while I was at it. And later when I heard certain stores gave rewards and cash back on credit cards- I collected a couple of those too!
When I got married I carried over about $5,000 dollars in debt. My husband had no debt. He didn’t even have a bank account actually. We paid down a little early on, though we never had a game plan or a reason why. When we started talking about buying a house, we decided to build up our credit score.
We took out a couple of small credit cards. Originally making sure to only keep what we could pay off in a month. But then one day we were introduced to a certain store’s credit card that seemed like a good idea. Spend a little, save a lot. The reverse was actually true, but again we didn’t know that at the time…
(I am not entirely against credit cards, (just like 98% against them) but anything you go into with no plan and no intention is bound to bite you eventually. Credit cards do require boundaries, wisdom, and discipline- we keep one that has a limit of $300 and we almost never use it. Borrowing money is not the answer to big financial problems.)
In Over Our Heads
Little by little, those cards added up. Limits were raised and we were barely even paying off the interest with minimum payments each month. I would have moments when I was paying bills where I would suddenly realize we were underwater, but I always brushed it off after a while. It was easier to just not think about it. Until the day, I had to face it head on.
I was standing in Wal-Mart waiting to check out probably about five years ago now. I pulled out my phone to check our bank account and suddenly realized I didn’t have enough for all the groceries in my cart. No problem, that’s what credit cards are for. I checked the balance- both were completely maxed out. I did the only thing I could do and started putting things back. Isaiah screamed as I returned things he had asked for to the shelves. I fought back tears as he cried.
I want to be sure and clarify that this wasn’t reckless spending that had brought us to this point. Poor money management: yes. But we had spent the money on groceries, diapers, and the big thing: immigration lawyers and papers- which were expensive and necessary. I didn’t have a cell phone during this time. We had no car payment. But we also had no wisdom or wise counsel.
We were broke, and something had to change.
Facing a Hard Truth
I want to say that everything changed that day, but not exactly. It had started a fire in me, but I didn’t yet know how to burn it towards anything helpful. Actually, everything changed about a year later. The day I faced a really hard realization: I lead myself into this, but I needed someone else to get me out.
I think anytime we land a hard place, we want to blame someone else. But this time there was no one to blame but me. I had made these decisions. I was praying for God to lead me out, but I think I was also thinking I had landed there by mistake. The truth was I had made every choice that had brought me to this point. So I began praying for God’s way rather than my own.
When I tell you guys Dave Ramsey’s name started popping up everywhere- I mean it. It was actually kind of crazy! Every book I picked up (even a book I was reading on cleaning and organizing). Every blog I read on anything mentioned ‘debt free’ and Dave Ramsey. I couldn’t escape it, so I started listening to him.
I literally listened to him all the time. Someone even gave us his book, so I read that too. We had talked about being out of a debt in the past, but suddenly we had a game plan. We had a ‘how’. So we faced it all head on. We wrote down the numbers of what we owed and little by little we started to pay things off.
After Christmas, tax returns, and draining our savings- we were finally out from in under our credit card debt. That part seemed to happen quickly. It was a relief. We cut up cards and began to dream again. But we had another giant to face..
Deciding to Be Debt Free
Every month on the 15th, though it always seemed like every couple of days, we had one payment still to make: student loan debt.
**Listen, if you are thinking about going back to school- find another way. We had minimum student debt compared to most and it was still a nightmare to deal with. In the end I think we paid my original loan amount of 5,000 over 3 times!
The best part of our debt free journey is that we went on it together! Rafael always called it his debt too, although I don’t recall seeing him in any of my classes. But it always encouraged me to know that he didn’t blame me, but rather walked beside me.
Mid April, as we sat in the play room eating dinner one night, I pulled out a piece of paper and made a bold proposition, “Let’s pay this off in 4 months.” Rafael just stared at me with wide eyes, ” Is that even possible?”
I honestly didn’t know. I had ran numbers all day and I knew it was a stretch, but I was so sick of the weight on my shoulders that I was ready to suffer short term for long term reward. The way I saw it I would rather struggle harder for a short time and be done than to struggle a little for years and years to come.
“Let’s try it!”
So we did.
Going Scorched Earth
As I mentioned earlier we weren’t spending frivolously, but we had to cut back somewhere. Of course, Netflix and those things were the first to go. We switched from Verizon to Total Wireless which saved us about $80 dollars a month. We cut back to bare bones, so basically electric, insurances, and water bills. Rafael worked every second of overtime he could acquire, which back then was quite a bit.
I knew that in order to do this we needed to put about half of each paycheck on to our debt- but even with overtime and cut backs we were still coming up short. If you read my blog 10 Ways to Save as a Home Economist , this is where that idea came from. Rafael could only do so much, so I knew I needed to bring something to the table.
When I tell you guys we went scorched earth- it is no joke. We had to make hard decisions. We had to turn down play dates, activities, budget birthday parties, say ‘no’ when we were dying to say ‘yes’. There was no deeming a sale too good to pass up. There was no it’s just a $2 coffee, it won’t hurt. We basically stayed home.
And the biggest thing- I cut our grocery budget back from $150 a week to $60, including buying diapers.. We truly ate beans and rice, rice and beans. I would buy a family size pack of chicken every week and stretch it to as many dinners as possible, but when that was out we ate eggs or beans.
And honestly, no one complained. We explained to our kids (2 at the time) what we were doing, and they worked along side us. I cried every time I watched a debt free scream on YouTube. I couponed, ran numbers a million different ways, prayed, and payed.
And in 3 and a half months, we submitted our last payment.
We were debt free.
We were exhausted. Worn. Dried up. And weary. But we were debt free.
When we paid that last payment, we had almost nothing in the bank. I sat and stared at our account thinking how small it was now compared to just a few months before, but that was when it hit me- this was the most money we had ever had. Even if we had 5,000 sitting in an account, if we owed 8,000- we were still negative. We were finally on the positive side of things.
It took a lot of work to get here, but I would do it all over again in a heartbeat because it was worth it. Rafael and I learned so much during that time about how to manage money, but the best lesson we learned- was how to set a goal and work together to achieve it.
We run this blog together because of that experience.
Being debt free has allowed us to dream again. We can dream about future plans and walk through them together because God allowed us to walk through this. Getting out of debt may sound miserable if all you focus on are the meal and lifestyle changes. That was part of it. But more than that I want to highlight the laughter we shared when Isaiah would sit at the table and talk about Dave Ramsey. I want to capture the peace of knowing that we were led by God and walking through this together. I don’t remember the difficulty, although I know we faced it. Instead, I remember dreaming, hoping, trusting, working, and seeing us do more than we thought we could.
We had two reasons ‘why’ back then. And now we have four.
We are free to dream. Free to save. Free to spend and live within our means. Most importantly, we are free to give in ways we never thought we could. We may not have a lot, but we always have enough.
One of the biggest joys in all of this is getting to buy groceries for others. From being that mom putting things back because I couldn’t afford them, to now being able to help others. I love when God brings things full circle.
If you are wondering if this is for you, if you are questioning if a debt free journey is worth it- believe me, it is.
5 Money Saving Ideas to Get You Started
1. Cut Out the Extras
You know when you go to a Mexican restaurant and they keep asking if you want all these ‘extras’ added on to your plate. Yes, yes, guac is extra, but I still want it. Well I can almost guarantee you, you have ‘extras’ in your life. They cost more, but you see them as worth it.
Some things are worth it. For example, I pay for a subscription to Friendly TV. (For many this may be Netflix of Hulu.) It is only about $10 a month, and I can watch a Hallmark movie or UP TV anytime I want. When we were getting out of debt this was something we let go of. We let go of a lot of ‘extras’.
Now saving $10 a month may not change your plan much, but most everyone has a handful of subscription services they pay each month: Netflix, a news subscription, a magazine, a meal plan service, Kiwi Co., etc. All of these seemingly small payments add up- run that savings over the course of 6 months and you are really making some progress on paying down debt or a financial goal you want to reach!
And remember you aren’t giving up the extras forever. Only for a season. Someday you can have all the guacamole or subscriptions you want (within reason) and they won’t feel like burdens to carry!
2. Change up Your Meal Plan
Unfortunately, we can’t negotiate our electric bill or skip paying the water for a couple of months. As far as the ‘have to pay bills’ go, there isn’t a lot of wiggle room. For us it was the grocery budget that changed the equation. Changing up the way we eat is often the hardest part. It’s why so many diets fail. But eating cheaper doesn’t have to mean ramen noodles every night.
This is a prefect opportunity to learn to cook. Or to learn how to make multiple dishes with similar ingredients. Pasta is generally inexpensive. Meat goes on sale when it nears its sale by date but is still perfectly safe to freeze and use it when you are ready.
Kitchen staples like flour, sugar, teriyaki, and canned tomatoes are also inexpensive. A well stocked kitchen is the difference between having a meal you can easily prepare at home and buying take-out on your way through town.
Changing up your meal plan in order to reach a financial goal or pay off debt is a one of the easiest and most cost effective changes you can make. And again, it isn’t forever, only for a season.
3. Wait on it or Work for it
This is probably the hardest to do. We live in a society marked by instant gratification. If we want it, we get it. But honestly a simple change in how we speak about this makes all the difference. It isn’t a glum, “No, never!” It is a simple “Not yet.”
Waiting on something can be hard, but God often teaches us some of His best lessons in the waiting. If there is something you really want, wait on it or work for it. When we were getting out of debt, I kept a poster in our room showing the progress we had made and where we were in relation to our end goal. It was the first thing I saw every morning.
I wanted a new coffee table and a rug for the living room, and I knew that once we accomplished this- we could save for that! If waiting is absolutely not in the picture or you are 2 years out from your financial goal, work for it. Sell your stuff or babysit or clean homes in order to buy it. Wait for it, or work for it.
4. Find New Ways to Treat Yourself
I know we live in a ‘practice self care’, ‘treat yourself’ and ‘live your extra life’ culture. Of course you should take care of yourself, but that doesn’t always mean you should get a spa day once a week, an iced coffee everyday, or a night out every weekend. Movies at home, homemade iced coffee, painting your own nails, or eating on the back porch can all be treating yourself without mistreating your wallet.
5. A New Mindset
This is the biggest change you can possibly make, be it with money or anything else in life.
For years we were content with minimum payments because they were comfortable. Choosing to get uncomfortable in order to achieve something you want is a hard choice. That’s why the greatest change you can make is to simply shift your mindset.
When you are dieting, if all you do is sit and look at pictures of food all day and contemplate how miserable you are- you are going to fail. The same is true with financial goals. If you sit around all day thinking about how much you are giving up or how hard this season is- you are setting yourself up to fail.
Just like with any goal- you focus on the finish line. You don’t look back and think well maybe it wasn’t that bad being in debt. We push on because our mind is set that something on the other side is better. When our mind is set to achieve this and our eyes are fixed on the finish line, there is nowhere else to go! You will get there and it will be worth it.
Set a goal and Achieve It
Until a few years ago, I didn’t think I was a very determined or goal oriented person. I made that observation about myself one night, and my husband just stared at me. “Yes you are! You’re probably the most determined person I have ever met.”
I was shocked by those words. But then my mom pointed to my refrigerator one day and said “I don’t think I have ever done that.” I looked at my fridge marred by coloring pages but interwoven into the gaps were a collection of lists, graphs, and timelines for goals we had set.
I suddenly realized what my husband had stated a few nights before. Natural labor and delivery, financial goals, homeschooling, gardening, cleaning- there are all goals that I set for myself and work to achieve. Mama, whether you realize it or not- you are driven. You are goal oriented at least to some degree. I am a free spirit in so many ways, but when it comes to goals for bettering my family- I am all in.
There’s an African proverb that says, “Wise men plant trees whose shade they will never sit under.”
That has become one of my favorite sayings. What if the choices we make today can influence our families for generations to come? What do you want to leave them? A mountain of debt that need to scale or a mighty oak filled with wisdom and prayers?
We make those choices. I hope your family sits in shade because you cared enough to plant a tree.
Happy Aiming, Mamas.
Resources for your debt free or financial journey:
Amazon Link to Dave Ramsey’s Book, The Total Money Makeover
(As an Amazon Affiliate, I earn from all qualifying purchases made through the links in my blogs. You do not pay extra, I am simply paid as an advertiser.)
Click here to check out our blog: 10 Practical Ways to Save Money as A Home Economist
If you found this blog helpful or inspiring, share us with your friends!