Wherever you look online, you are sure to find many resources who have the steps and tools you need to get out of debt. While I am sure that they are able to help you out, I wonder if they really understand the toll debt can take? Have they been there? I wonder even more so if they know what bankruptcy feels like. I am not sure that I feel I can relate to anything they say as they are not me.
You see, I am one of those people. I’ve declared bankruptcy. My husband and I have even paid off our current debt with blood, sweat, tears — and LOT of determination. I am sharing my story with you to let you know that there are people who get it. It sometimes helps to know that you are not alone and there really can be a light at the end of the tunnel (no matter how long that tunnel might be).
From loving life to bankrupt
In 2001, I was loving life. I was approaching my 30s and had a great job. Sadly, I didn’t pay that close attention to the items I purchased with my credit cards. I just kept doing what so many Americans do – made the minimum payment each and every month. In December of that same year, I received a shocking wake up call. I was ending a long term relationship and was no longer able to make ends meet. I knew that something had to change, but being young (and still pretty stupid), I did what I thought was the only answer — bankruptcy.
In August 2002 it was in print. I was officially bankrupt. It was not a good feeling. I was ashamed that I had allowed myself to get into this situation? I wiped the tears from my face and vowed to leave that in the past and focus on my life — a new life with my new fiancé.
June 2003 we said “I do.” We were both in our 30s and knew that we wanted to start our family sooner than later. Another thing we both agreed upon was that I wanted to be a stay at home mom and raise our children. We realized that this might pose a slight financial strain upon us, we knew it was worth it for our children.
Money was tight after our daughter was born; however, we never used credit cards to pay bills – not even groceries. We had accumulated some debt which included auto loans, a home equity loan and one department store credit card. While we struggled to make ends meet some months, we still managed. Not sure how, but we did.
Discovering Dave Ramsey and making changes
In the fall of 2007, some friends shared their own debt free journey with us and we learned about Dave Ramsey. The more we read about his methods, the more intrigued we became. We both thought the idea of not having debt was incredible, but weren’t sure we had the means necessary to achieve that goal. So we bought his books and sat down and read them cover to cover and within a few days and were inspired to get started!
We changed our way of living. I did the same steps many others have done – right down to cutting up those credit cards and using only cash for everything. The toughest thing for us was that budget. Ugh – a budget. It can make you sick to your stomach. We had to keep tweaking it, but we got it to work. How?
We reduced our grocery budget and then used extra money to pay down debt. Part of doing so was to find a way to save more money at the store. Through learning to do so and sharing these tips with friends and family, I started a blog. As I shared my deals, we continued to pay down our debt. We sold items. We didn’t eat out.
The most liberating feeling
Finally – in February 2010 – we made our final debt payment! It was liberating. I can’t describe the feeling. This time around I did it the RIGHT way. I didn’t just run from my debt. I faced it head on – with my husband. We paid it all down. It took us 27 months, but we did it. Paying off our debt was truly the most liberating feeling in the world!! As part of our journey, both my husband and I learned our most important lesson “There is no such thing as good debt.”
I am proud of so many accomplishments in my life (my husband, my kids and my site), but I am also very proud that I was able to actually pay off that much debt. When I say that this was life changing – it truly was. Not only did we pay off our debt (other than our mortgage), we permanently changed our way of living.
To this day, we still use the same budget form. (Jackie’s note: Here’s a great budget form if you’re looking for one.) We check and update it regularly. We still use cash — and use our envelopes. If you ever catch me shopping at the store, you will see that is how I pay. We still have no debt – and do not plan on heading down that path again. We have fully funded our emergency fund. We have been able to do things that we want to. When you do not have debt, your money is all yours.
You can do it
I share my story with all of you so that you all know that it is possible to do this. I want you to know that I understand where you are at – more than most of you probably ever realized. If you want to change your life, you can do it. But only you can make the decision to change your life – for the better!
Tracie shares her money saving tips and ideas daily at Penny Pinchin’ Mom. She is featured regularly on her local CBS Affiliate – KCTV5 – helping local families learn how to make the most of their own budget. When not busy saving money and helping others, she is a mom to 3 kids, ages 4 – 8, at her home outside of Kansas City, MO.