Debt can be a drag. I know we’ve accumulated debt at different times in our marriage and it’s not fun.
Not only is it not fun, it can really creep up on you when you least expect it. It starts out small and usually ends up a lot bigger than you ever wanted. It’s hindering and it takes work to get rid of it.
Today we have an awesome interview with one of our course members, Rebekah, who got on the debt payoff bandwagon and paid off a whopping $56,807.09 in 13 months!
She has some great tips on how she did it and how she used flipping to add to her debt payoff – even if it was $4 at a time.
Let’s hear it from Rebekah.
What was the turning point where you decided to get out of debt?
I’ve always wanted to be out of debt. Fifteen to twenty years ago, I learned about Dave Ramsey and took one of his mini classes at the library.
At that time, we only had $10K in debt and we thought it was terrible. Since then, we have amassed a huge amount of debt getting married and having kids. We have six kids, ages 11 to 32.
At the beginning of Covid, we decided we could no longer have this much debt. Together we made a decision that it was time. I was still fortunate to be working and we were home often so it was a good time to get started.
So my husband and I took a look at our accounts and saw where our money was actually going. We then took the most important step and that was creating a budget. We took the plunge cold turkey and jumped in.
How much have you paid off and how long did it take you?
We started April 1, 2020 with our budget. By May 31, 2021, we paid off $56,807.09!
When we were looking at paying off our debt, we wanted to follow the Baby Steps with Dave Ramsey. We had known all about him and thought that would be the easiest for us to follow. For years, I had been looking at his program. We started and stopped a few times but never would be able to get out of Baby Step 2.
This time, we decided to change the way we looked at money. The bottom line was we were going t0 make a budget and stick to it.
We changed our mindset in ways like not being embarrassed to put all of our extra money towards debt, even if it was $4! Before I had a mindset that such a small amount of money didn’t matter. Why would I put an extra $4 towards debt because it doesn’t make a difference?
But when we put every extra dollar towards debt, it started to drop our debt total significantly. Even those small amounts of money were making a difference.. When I didn’t spend as much on a bill where I thought it would be $68 and it was only $64, I would put that extra $4 towards debt.
We had to realize that $4 was getting us closer to our debt and we were using all of the extra money and resources to throw towards our debt. We realized if we continued to do this, eventually we would reach our goal.
How did your flipping gig help you on your debt journey?
One of the things that was helpful as I was learning from the course group and through all of your posts and digging down for more and more items to sell, every time I had a little sale…$20, $40 – those flipping funds were pure debt.
There were some months when I was dry with flipping, but I had a fantastic October-January and participated in the challenges that you offered. I made some great money and it made a huge difference in our debt.
I was getting $20-$100 per sale and that money was going straight to my debt. It made a huge difference and I saw my debt start to go down rapidly.
It’s easy to get back into debt when you get out. What were some things that have helped you stay on your path to living debt free?
Our #1 thing was budgeting. If we didn’t have a budget, we wouldn’t know where our money was going and we would end up right back in debt.
Last Apri I set up our budget, I was looking at all of our accounts and determining where my money was actually going. This was helpful because I was finding that I was wasting money at times, even having subscriptions I had been paying for over 2 years and never used!
Continuing to budget has helped us stay the course and keep a handle on our finances.
Because I get paid 26 times a year, I would budget for the month and so twice a year, I had an “extra” paycheck in that month. It was like a windfall and I was able to take that check and put it 100% towards our debt.
It would have been easy to say I want to do this and this and this. But when you are budgeting and you have your categories set, you know where and how much needs to go into those categories, and anything extra goes to debt.
Covid kind of helped us in a way also because we weren’t going to as many places. So our gas bill was lower and we weren’t eating out as often. We didn’t pay for summer camps for our sons and other activities that they weren’t doing during that time.. And the Covid relief checks that came and those went 100% to pay off our debt.
In the past when we’ve had a tax return or extra money coming in, we would think of fun things to spend it on even though we had debt sitting around. So it was a total change in our mindset and a paradigm shift. We were able to change our family and our finances. Everybody in our household needed to be onboard.
What is your work background?
I spent 22 years in the Navy so I am retired from the Navy and a registered nurse. I started working right away when I retired from the military as a nurse.
My husband is a sports official and he works primarily on evenings and weekends. I work full-time as a registered nurse for the VA. I was fortunate not to lose work once Covid started.
Our boys that are at home are ages 11 and 14 and we are lucky that we are done with daycare! It was a big expense.
Once we got started in the mindset to pay off debt, we had to decide what was going to work for us. Like Dave Ramsey… he can be on one totally different end of the spectrum. I’m somewhere kind of in the middle.
We still had Netflix, Amazon music, and Disney Plus. We had to decide what was important for our family and we felt we wanted to keep those things in place while we got out of debt.
Everybody’s family is different, but you have to decide as a family what you are going to cut out of the budget.
You also have to look at your salary. If you are making $35K a year, you will have a different budget than someone making $80K. So it’s so individual. But the bottom line is you have to stick with whatever you decide and follow your budget.
I used the electronic budget because I could go into the budget and move things around if something happened or things changed. The app had me budgeting every single dollar and that worked for us.
We also started planning for large purchases – like Christmas. Now I have a Christmas budget and I save it before Christmas comes. We are always thinking about where the money is coming from and planning ahead has helped.
What are your plans now that you are out of debt?
Now that we are out of debt, we are moving into baby step, #3. So we are getting a fully funded emergency fund.
Once we have our emergency fund filled up, we need to start thinking about college funds for our two kids. We do have a 9th grader and it will come fast. I have the GI bill, but that is not going to be enough to send both of them to college.
We have also changed how we look at big purchases. Now we save for the next big purchase instead of going into debt. That’s always our goal.
What is something that is helping you stay out of debt and not going back into debt?
I’ve seen people on Instagram with a little message board on how much they paid off in debt. I made one of those and posted it on the wall of our bedroom. We see it every single day every time we are in the bedroom. It shows us the work that we did in order to pay off our debt.
That’s very helpful.
The feeling of being debt free is also great too. It’s so nice to move the entire category of money into other things directly to our fully funded emergency fund until it grows. And then on to the next step.
My goal is to get started paying off our house and then on to the last step which is wealth building, which is living the life that is with financial freedom.
Perseverance is key. You have to stick with it. If something happens, you have to pick yourself up and move on. Throughout the year, we decided we needed a new couch. We were able to pay for it in cash and not go further into debt. We delayed a little with our debt snowball and then picked up where we left off.
Life is up and down. You will have bumps in your road with paying off debt. As long as you keep going and don’t fall off the wagon and become crushed under the wheels and never get back on, you will do well.
Everyone’s pace is different. It’s not a race. You will get there. You just have to keep at it. This is the world we live in right now with instant gratification. Debt payoff is not instant gratification. It is hard work and takes dedication and perseverance.
Thank you so much for taking the time to talk with us Rebekkah! You are an inspiration to us and we know you will help so many others make those tough decisions and become debt free!