How We Paid Off $15,000 of Debt in 1 Year

Personal finance, get out of debt!

Hello everyone!

Thankfully, we made it out of 2015 and we are starting 2016 off with a bang! We are getting back to the basics, returning to our old routines and hobbies we’ve always enjoyed.  Hobbies that include budgeting and debt elimination.

Money management has and always will be one of my top priorities in life. Now that it seems as if our storm has cleared, we’ve made some immediate and drastic changes. Our main priority is to take the necessary steps in our lives to improve our present and secure our future. Over the next few months we’ll be detailing our changes and sharing tips on how you can do the same!

Debt Free? Yes, Please!

Today, we’re talking about budgets and paying off debt and I AM EXCITED!!!

In November 2014, I noticed that a shift was happening in my life – sickness, unemployment and disappointment seemed to be my new normal. I sat Mr. down and said “I need to know what our finances look like”. He assumed I wanted to just know how much we were paying for cable (which terrified me once I learned) and other bills, but I wanted to know EVERYTHING.

2 years of marriage had already passed and you would think we would have sat down to lay out all of our debts in one place. WE HAD NOT. When things are going well and you’re having a good time, budgets and debts are the last of your worries. At this point, we decided to sit down and sift through ALL of our expenses and current debts. When I saw that we were paying DirecTV $94 a month (not including the $50 internet) I was on the verge of a major freak out. I think I actually did collapse when MR. put his $56,000 worth of student loans and our $10,000 worth of credit card debt into the spreadsheet.

After that slight concussion, I made a commitment to use my money pinching skills to assist my husband in keeping track of our expenses and eliminating our debt. Within a year, on essentially one salary (and my starving artist pennies), we reduced our credit card debt by $5,000 and our loan debt by $10,000.

debt elimination

We eliminated $15,000 of debt without even following the budget that we made (side-eye to my hubz) lol. In all seriousness, 2015 was a rough year, but 2016 will be much different. We made a commitment to stick to our budget and track our progress towards financial freedom.

We’re sharing the spreadsheet that we created because it has helped us tremendously. We didn’t follow our budget per-se, but the act of sitting down and putting all of our expenses/debts into one place gave us an in depth look at our financial situation. This is the first step towards achieving financial freedom because you have to see where you are in order to figure out where you are going.

unsolicited truth debt management tool

How do you actually get to financial freedom?

Make a “Get out of Debt” plan.

That’s what the budget is actually for. Your budget (if you follow it correctly) is the guideline for spending your money. It should be set up in a way that makes sense. Allot funds for your necessary expenses, but try to cut back on things that you don’t really need. Put that $200 coat back on the rack and instead, add $200 to your savings account, or pay off a credit card.

Do whatever you need to do in order to motivate yourself to follow your budget, or at least to remember what you put in it. We started out using Dave Ramsey’s envelope system, but that didn’t last very long. We don’t typically carry cash, so it was hard to keep up with what we took out to use and what we actually had on us when we needed to spend.

Our current system is a (joint) checking account that we deposit our budgeted funds into at each payday. Money left over after filling the budget goes toward debts and our savings account.

We still sort of use the envelope system for our budgeting. We use an app called Good Budget to manage digital envelopes…more on our experiences with that later.

That’s it for now!

Stay tuned for more great information and be sure to download our Debt Management/Budget Spreadsheet!!

unsolicited truth debt management tool

Let us know how it works out for you!

– Mrs

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2 thoughts on “How We Paid Off $15,000 of Debt in 1 Year

  1. Rachel Gillen says:

    Good post and great job! I recently started using an app called “fudget” to track our spending and try to get a handle on our debt. It’s not easy! But I’m hoping to make some progress this year. Looking forward to more tips from you guys!


  2. Rachel Gillen says:

    Good post. And good job! I recently started using an app called “fudget” to track our spending and try to get a handle on paying down some of our debt. It’s not easy! But I’m hoping to make some progress this year…


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