How They Did It: Amy Paid off $30,000 in Debt in 2 Years
Amy Beardsley is passionate about personal finance and debt reduction. In 2015, she and her husband Andrew started on a budget making, debt-destroying journey to put an end to the cycle of living paycheck-to-paycheck once and for all. She recently shared more of her story with me below.
Tell me a little about yourself and background.
A divorce in 2008, when my daughter was just 2 years old, left me financially vulnerable. I made it my mission to do everything I could to support her on my own. I went to college and attained three degrees in four years (I worked hard!) and landed a job in my field of study (the legal field) my last semester at college.
From there, I bought a house and met my now-husband. We were married in 2014 and all that stuff they say about soul mates is true! He is mine and I am his. I never knew love could be this beautiful! Okay, moving on from the mushy stuff...right now I'm working full-time as a court administrator and run my blog and a freelance writing business on the side -- bringing in extra money to help with our debt.
I'm also a Girl Scout leader and am teaching right now for a Jobs for Life course through our church. My husband also helps out with Jobs for Life, doing all the tech/computer work and he coaches little league baseball in the summer. My daughter is in Girl Scouts and participates on a local gymnastics team. We are a very busy family!
How did you start your journey toward financial freedom?
My husband and I got ourselves into a tremendous amount of debt in a very short time. We put our wedding on a credit card in 2014 (bad, bad, bad idea!) and then faced a few financial hardships -- 2 car accidents that totaled our vehicles and required us to buy new ones with money we didn't have followed by unexpected medical expenses coupled with a very high insurance deductible that we were unprepared for.
When we got behind on bills, I knew we were in trouble and I was scared. It was a huge wake-up call! We started our budget-making, debt-destroying journey in January 2015 and have been working on paying down our debt since then.
How much debt have you paid off to date?
As of January 1, 2017, we have paid off $29,964.87 in debt. It's important to note that this is just the principal balances we've paid down and doesn't take into account all of the money -- THOUSANDS of dollars! -- we've paid out on interest expenses. It makes me sick. Every time I get a statement in the mail and see how much of my hard-earned money is going to interest it ignites my passion to get rid of this debt for good. I want to spend that money on other things! Fun things!
What specific tools or strategies have been helpful in paying off debt quickly?
My husband and I had weekly budget meetings for a looooong time our first year on our debt-free journey, so the accountability of that is a good motivator.
As I mentioned in one of my blog posts, "Seeing the cash that’s in the envelope (or not in the envelope!) helps you to take pause and really think about the money you’re spending each month. A budget is the glue that holds your envelope system together – without it, your best-laid plans will fall apart."
Creating (and sticking) to a debt snowball.
The debt snowball method is a huge motivator! When we knocked out our first three (smaller) debts right away, we felt the weight of our debt get a little lighter and we began to have hope that maybe we really could do this.
Staying motivated is hard when you're at the store and see a new purse you want. And telling your daughter "no" when she asks for brand-name cereal at the store because you're trying to get your grocery budget under control is really tough.
Using visual aids.
Anything visual is a good motivator -- here are some other things we've done over the years: Hang your budget on the refrigerator as a reminder, make a bar-graph and color it in as your pay off debt a little at a time, and make sure you celebrate each accomplishment. When we pay off a debt, we usually go out to eat -- that's one thing we miss the most as a family -- or we'll opt to go see a movie at the theater. Just a little something to look forward to along the journey.
What's been the hardest part of your journey?
The hardest part was getting both of us on the same page with money. Talking about money isn't fun for newlyweds. We had a very good relationship and felt comfortable talking with each other about so many things -- but money was a topic we never discussed much of. Things were going pretty good, so there wasn't a need.
But toward the end of 2014, when I realized just how much trouble we were in with our debt, I knew we had to get on the same page with money. We had BIG fights at first. Like, me stomping off and slamming the door shut, and lots of yelling (embarrassing to admit -- but it's the truth). I realized we needed to have our talks in smaller chunks -- first we agreed that we have a problem, then we talked about how "bad" our problem is and how it made each of us feel, then we listed our debt and brainstormed solutions, and finally agreed on doing a budget.
What are some of your financial goals for the rest of the year?
My financial goal has been "to pay off debt" for so long, it's easy to get frustrated when the debt seems never-ending. We break that big goal down into smaller ones.
This year, we're focusing on eliminating ALL of our credit card debt. By the end of the year, that should be completely eliminated. Can you imagine? Not having a monthly credit card bill coming in the mail? Seems surreal to me. And once those are paid off, we're moving onto saving for a maternity fund -- my husband and I want to grow our family! And doing that with the amount of debt we had is a bad idea -- diapers and daycare are expensive!
Any advice for the readers or anyone out there who is trying to start their own journey toward financial freedom?
The biggest lesson I've learned in all of this is that you don't have to spend money to have fun. At the beginning of our journey, I found myself feeling sad that we couldn't afford this or that. But that old adage about spending time together being more valuable than spending money on each other is true. Our family loves game night -- we get out Monopoly, Apples to Apples, and a deck of cards for Rummy and Crazy 8s -- and we have a great time. Also, we have more fun making home-made pizza than we ever did going out to a restaurant and ordering it.
Want to stay updated on Amy's journey? Join her at www.MarvelousMrs.com where she blogs about their progress and offers advice on real money for real women.
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