Calling Dave Ramsey for their "We're DEBT FREE!!!" scream!
This is the story of a family of 4 swimming in debt and living on a single income. Can you believe that they managed to pay off over $77,000 of debt in just over 2 years? This is Katie’s story…
I’ve always known debt. I got my first credit card when I was 17 (a gas card with a $200 limit that I quickly exceeded buying chips and soda and it was closed when I didn’t make payments). When my husband and I bought our house in November 2004, we rolled all of our debt, save for his student loan, into our mortgage. We were “debt free”.
Yeah right.
We’ve been a single income family since May 2006 when I quit my job as a nanny while expecting our first child, and like the majority of Americans, we lived paycheck to paycheck. Scratch that. We were living paycheck PAST paycheck. My motto used to be “go big or go home”.
We were financing a TV? Why not get the $1500 one instead of the $300 one?
We were financing a new car? Why not get a luxury car instead of a sensible one?
You think travel trailers are cool? Finance it!
We thought in terms of “how much overtime…?” As a police officer, my husband is able to pick up shifts to bring in extra scratch. But in the days BC (Before Children), we had no idea how that would affect our family. The equation is simple:
Overtime = Time away from the house = Time away from our kid(s).
In July of 2009, my husband and I found ourselves about to grow our family (I was 34 weeks pregnant with our second child) and scared to death of what the future held. Heck, I could feel my blood pressure rise just with the opening tone of our Quicken software! Could we pay for college for our kids? Could I still afford to stay home? Would we ever feel like we weren’t drowning in debt?
Three credit cards, a car loan, a travel trailer loan, and two student loans. $77,232.88 in debt accumulated in less than 5 years! The thought is still takes my breath away. We were working like dogs to pay for things. Stuff. Junk. At one point, we were paying $1100 a month in car payments!!
That $1500 TV? It’s already broken and donated for parts.
That luxury car? I stopped driving it 6 months after I got it because my pregnant belly was uncomfortable in it. (But the $556.45/month payment was steadfast)
That trailer for built-in family vacations? My husband was working so much overtime that we rarely got to go anywhere!
We were able to make all of our payments (our mortgage in Northern California included!) but remember that fear of not being able to pay for college? Of not being able to stay home? It was always there.
One day, while perusing miscellaneous blogs, I spotted the name Dave Ramsey. I’d never heard of him, but his principles were sound. In fact, they were very similar to thoughts I had had and suggested to my husband not long before. I told him a little bit about what I had read, and he ran out to Barnes and Noble to buy his book, Total Money Makeover for $21.84 on July 12, 2009.
Thus began our transformation.
to be continued tomorrow…
About Katie
Katie moves the hands behind the blog My Daily Bread Crumbs, where she blogs about faith, finances, and food. She’s been blessed with a similarly driven and very supportive husband of 7 years, three inspiring children, and two wacky dogs. She spends her days managing her household, refereeing kid squabbles, and working on her imperfectness. You can also find her on Facebook and Twitter (@MyDailyCrumbs).
The Frugal Find via Facebook January 18, 2012 at 11:19 am
Are you inspired? Maybe some of you are discouraged…make sure to check back tomorrow for a few practical tips and weekly for a new series on knocking out debt in 2012.
Chrissy Sue Winterbottom via Facebook January 18, 2012 at 12:03 pm
I’m excited!
Krista Hodgins Stracuzzi via Facebook January 18, 2012 at 12:19 pm
I AM SO EXCITED!!! Please tell…PLEASE PLEASE PLEASE!
Arlisse Fitzgerald January 18, 2012 at 12:29 pm
looking forward to the rest of her story…i have those same fears so i’m interested to see how she did it
Donna Rich via Facebook January 18, 2012 at 12:41 pm
With my debt and at my age 55 it seems so impossible to get out of debt.
Katie January 18, 2012 at 1:16 pm
Donna: I’m also a Financial Peace University Coordinator, and I can tell you, with the right tools and using the skills you have, it’s possible. If you’d like to chat via email, I can be reached at mydailybreadcrumbs AT yahoo.com
The Frugal Find via Facebook January 18, 2012 at 12:45 pm
Donna, it’s not I’ve seen it time and again. There is a tried and true proven method, Dave Ramsey lays it out for you and we’ll be helping you along the way this year as well.
Laureen Eastin via Facebook January 18, 2012 at 12:58 pm
Inspiring, yes… but I don’t think we even bring home $77,000 in two years. Ha. :/
MaryBeth January 18, 2012 at 1:07 pm
That’s exactly how I feel, Laureen. My husband just got done with school and started his first teaching job this past September but it is only part-time. Luckily, we’ve learned to live below our income. Just wish the income was a little higher so I felt like we were making a difference faster
Danae January 18, 2012 at 1:59 pm
That is our problem…how do you pay off a debt (my student loan for my teaching credential that I can’t even use here in CA because of lack of jobs) that is more then you even make in a year?
Julia January 18, 2012 at 2:02 pm
Danae, there is a lot to it but we had to ask ourselves “how can we NOT pay off our debt”. Then when you get desperate, you get creative. It doesn’t have to be in a year (not common at all!), but you have to have a plan for when it WILL be paid off.
Katie January 18, 2012 at 1:18 pm
so it would take you three… four… five years. However long it takes, it’s worth it to gain back the rest of your life! Every situation is different, but it’s possible. Hang in there!
The Frugal Find via Facebook January 18, 2012 at 1:04 pm
I know Laureen, that isn’t common for most people but being debt free IS possible. I’ve been there feeling like there is no light at the end of the tunnel, low paying jobs, etc.
Lynn January 18, 2012 at 1:36 pm
I can’t wait to read more. I can’t wait to learn. Good for you Katie!!
Sylvia January 18, 2012 at 1:36 pm
Looking forward to the next chapter of this story!
Krista Millar January 18, 2012 at 2:16 pm
I have to say Dave Ramsey changed my family’s life! Dave Ramsey was introduced to us 5 years ago at our church. We are now less then 2 years from being debt free, including our house in Northern California that we bought at the hight of the market!! I have to say that the financail freedom that we are already feeling has brought new delight to our lives that we had never known before. We started with 1 income at $40,000 5 years ago with a family of five and we have worked our way through our debt!! It can be done!!!
Katie January 18, 2012 at 2:25 pm
Krista! That’s AMAZING! To God be the glory!! Our goal is to have our house paid off by the time my husband retires in 10 years this May. But a story like yours makes me think we could do it sooner! Have you stayed Gazelle Intense the whole time?
Krista Millar January 18, 2012 at 7:23 pm
For the most part we did stay at Gazelle pace, but the Lord has been kind to us and we have also seen an incrase in our income over these past few years. To God Be the Glory is right! Through him all things are possiable!
Gilda January 18, 2012 at 4:09 pm
Love Dave Ramsey. I’ve seen AMAZING things, but I love his Motto “Live like No One else, so that Later you Can Live like No One else” (basically saying, yes, it’s going to be hard work and people might think you’re “freaks” to get out of debt and fast, but when you’re done you’ll be living a debt free life). I’d definitely recommend going beyond the book and look for a Financial Peace University group at a local church too. Accountability never hurts and who know what fun people you’ll meet (who are in the same situation as you).
Katie January 18, 2012 at 5:15 pm
Oh, it didn’t stop at the book! I’m an FPU coordinator. We start our 4th class on Feb. 4. It’s so awesome to see God working miracles in each of the students!
Carole Douglas via Facebook January 18, 2012 at 4:23 pm
looking forward to part II tomorrow : )
Rhonda A Johnson via Facebook January 18, 2012 at 8:11 pm
I am totally about to go all in and knock this out too!
The Frugal Find via Facebook January 18, 2012 at 8:12 pm
Rhonda, you won’t regret it for a second!
Rhonda A Johnson via Facebook January 18, 2012 at 8:13 pm
I will tell you how it feels to be car payment free next month =) Pay off our second car then! I just did my payment today and it felt amazing knowing that I only have one more payment left!
Melissa Pflugradt via Facebook January 18, 2012 at 8:15 pm
We’re going through the Dave Ramsey program too this year for our first time. Hoping it’ll make a difference in us too! Our first class is tomorrow.
Luana Palakiko Fukumoto via Facebook January 18, 2012 at 8:16 pm
That’s so awesome!!!
The Frugal Find via Facebook January 18, 2012 at 8:21 pm
I’m so excited for you Melissa!
Angela January 18, 2012 at 8:22 pm
Some of the ways to pay off debt are to be creative. Sell your stuff on ebay, have garage sales, sell that new car and buy a much older car. Take side jobs cleaning house, babysitting, handy work, etc. Instead of buying new “stuff” take that money you just earned and pay it directly to the debt. Also, many times you can call credit card companies and get them to lower the interest rate or try moving your 3 credit cards into one with a lower interest rate. Trust me, there are many ways but you have to be willing to change your mindset of being a consumer. Play a new game of how much money you are sending to pay down your debt!
Melissa Frugal Burbank via Facebook January 18, 2012 at 8:28 pm
I love Dave Ramsey! <— This man needs to run for president!
Casandera Steiner via Facebook January 18, 2012 at 8:28 pm
Julia…we so need to do this!! I went to his website and there are so many different things to buy…what did u start off with buying to get with the program? There is a starter bundle for $39 that seems reasonable. I just don’t know where to start? And there are local classes in my area…good idea to take also?
Bailey January 18, 2012 at 8:29 pm
Thank you for sharing! we are in the middle of our Dave Ramsey study and steadily paying off debt.. It is not easy, but I am NOT OK with paycheck to paycheck… I hope to be makinng the DEBT FREE call in a year! thank you for sharing frugal find!!
The Frugal Find via Facebook January 18, 2012 at 8:33 pm
Casandera Steiner, I would HIGHLY suggest joining a class. You’ll get a kit with everything you need. It’s $99, but trust me it will be the best money you’ve ever spent.
Kristen Brandsema Lowery via Facebook January 18, 2012 at 8:34 pm
Wow, we barely have more total income than that for our family of 6 for that time period–but then again, since they aren’t including a mortgage in their tally, I guess our 6,300 in similar type debt doesn’t seem too bad.
Christie Johnston Harvey via Facebook January 18, 2012 at 8:42 pm
I just set up a payment plan to pay off my mortgage in 15 years instead of 30. Our car will be paid off next month so I will put that payment to the mortgage to try and pay it off in 10 years instead.
Jennifer Mathews via Facebook January 18, 2012 at 8:51 pm
I know Katie and Jason they are amazing people. I am so proud of them!
Carole Douglas via Facebook January 18, 2012 at 9:54 pm
I love your blog… congratulations on being debt free; praise God!
*so sorry about Evan God bless him and his family
Carole Douglas via Facebook January 18, 2012 at 10:00 pm
God is teaching me to do with what we have, making clothes; had the fabric for yrs., mending socks instead of buying new ones, hand washing some items and hanging them to dry, DIY as much as possible… and don’t leave the house unless needed; then travel in a circle, running errands in order and back home (to conserve gas) bake our own instead of store-bought, and its saved lots of money
Kim January 18, 2012 at 10:40 pm
We have older cars and they are killing us in repairs. This series should be great.
Nikita Ka via Facebook January 19, 2012 at 7:48 am
I am so overwhelmed, don’t understand were to start from, the book or the class…please guide me…any tips will be appreciated
your’s is my best favorite blog, i have learnt so much from you…can’t thank you enough. May god bless you & your loved ones 
Jennifer Kittell via Facebook January 19, 2012 at 8:35 am
we started by listing all our debt and the interest rates. we started with the highest interest debt and worked from there. we cut out everything ‘trendy’ and unnecessary. hope that helps!
My Daily Bread Crumbs via Facebook January 19, 2012 at 8:47 am
Nikita: Just making a commitment to change is a good place to start. Hopefully Part 2 will help give you other ideas!
The Frugal Find via Facebook January 19, 2012 at 11:58 am
Nikita, feel free to email me. I’d love to help if I can. Thefrugalfind@gmail.com
Tiffany January 19, 2012 at 12:12 pm
I love these stories, can’t wait to hear more tomorrow!
Jacqueline Snell January 20, 2012 at 1:54 pm
I think this is so great! We are really trying to be debt free! I just hate coupons :/ We are cutting up the credit card tonight and deleting it from automatic payments. Step one! HARD! Our goal is to be out of debt in 36 months
Julia January 20, 2012 at 1:55 pm
What an amazing journey you’re about to embark on! Good for you!!
Carol January 22, 2012 at 10:50 pm
I’m a SAHM of 4. We have no debt, we have a year’s supply of food, tithe faithfully, shop frugally and certainly live within our means. My problem is that we never seem to have money saved. Everytime we get some $$ in savings, something seems to come up. Now we have finally found our dream home/property (we’ve rented for-EVER) and have until November of this year to buy it (we are currently living there for a very low rent). I’m stressed that we’ll never have enough saved for a down payment. I’ve heard of Dave Ramsey, but isn’t he just for getting out of debt. I’d like to know how to just get ahead and put some cash aside for our house and emergencies.