How to Pay Off Debt Fast: The Popes Crushed $120k in Less Than a Year
Michael and Sonya Pope a couple with three boys managed to pay off $119k of debt in under a year. They used the help of financial gurus, budgeting, side hustles and changes in their spending habits to become debt free. I recently spoke to Michael about their journey to debt freedom!
Keep reading for their specific steps to paying off debt fast.
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Tell me a little about yourself and your background.
We are Michael and Sonya Pope, ages 43 and 41 respectively. We live in the Cincinnati, OH area with our three boys William who is 10, Charles who is 9, and Matthew who is 4. Sonya and I have been married for 20 years.
I work for a large manufacturing company in Information Technology as an Application Developer and Sonya has been a stay at home mom since William was born. Before that she was working for 10 years in the insurance industry. We also serve as Kindergarten teachers at Solid Rock Church. If you would like to know more about our family, please feel free to check out our family website at www.MeetThePopes.com.
What was your relationship with money like before you began your quest for financial freedom?
Our relationship with money was very unhealthy. We understood God’s Laws of Prosperity and we were tithing; donating 10% of our income to the church. As well as giving to multiple ministries on a consistent basis.
However, as our income continued to grow so did our spending. We found ourselves constantly running out of money before the end of the month. Since we weren’t living on a budget we didn’t realize the hole that we were digging ourselves into. Our biggest financial mistake was using our credit cards as our emergency fund and using our credit score as our sinking fund.
Was Sonya the "spender" or was Michael? :)
Michael is the “spender” and Sonya is the “saver”. Sonya paid her way through school and graduated debt free. If I had listened to Sonya 20 years ago we would have never have gotten into debt.
What was your AHA moment that made you change your financial strategy?
In November of 2015, I started feeling financial pressure and found myself really scared about the future. Sonya had walked away from a successful corporate career to be a stay at home mom and she was trusting that I would be able to provide for our family. Sonya really wanted to get a part-time job but we didn’t know when or where we could possibly fit that into our busy schedule. We suffered through the next couple of months on credit, praying that nothing major showed up. Finally, in February 2016 after sitting down and doing our taxes it finally hit us; we were making way too much money to be in so much debt. To make matters worse we were constantly running out of money before the end of the month. Sonya and I talked and we decided that we were going to follow Dave Ramsey’s plan to get rid of our debt.
How much debt have you paid off since then?
So far we had managed to pay off $119,000 in 11 months.
$60,000 of the debt was paid off from the sale of an unoccupied condo.
- $8,400 from personal loans.
- $39,000 from 8 credit cards.
- $12,000 from 2 cars that we refinanced twice.
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What was your range of income during this time?
- $110K - $115K (+ $11K bonus)
- $19K (Profit from condo sale)
- ~$5K (Side income [Web development, research studies, etc.])
What specific plan did you follow?
Sonya and I took Dave Ramsey’s Financial Peace class twice during our 11-month debt free Journey. We were "gazelle intense." We cut as much as we could and we were willing to earn extra income.
- The first thing that we did was to create a zero-based budget using EveryDollar.com.
- Next, we started paying off our debt using the debt snowball where you list all of your debts from smallest to largest and pay them off with gazelle intensity.
- Then, we reduced our expenses and increased our income.
- We temporarily stopped retirement investing.
- We increased our income through side hustles/projects, selling unneeded items, tax refunds, monetary gifts, bonuses, and a promotion.
- We also adjusted our tax withholdings.
How did you stay motivated?
We developed a DRIVE to be Debt Free and Financially Independent. I use the word DRIVE as an acronym to describe our mindset.
D – Decision. We decided that we were going to commit to following Dave Ramsey’s plan no matter what. We attended our 1st FPU class on March 22, 2016 and we committed to following the plan without compromise.
R – Reasons. Part of developing our DRIVE included identifying our reasons for wanting to be debt free.
- To create financial security for my family
- To free up our household income
- To be able to give more
- To help provide for our children’s future
- To be an example for our kids and family of how to live debt free
- To have more money to spend on the things we enjoy (without feeling guilty)
- To get out of the mercy of lenders
- To use our money to build wealth
- "Debt steals your options" – Rachel Cruze
I – Inspiration. Maintaining our motivation was key to paying down our debt as fast as we did. Sonya and I watched debt free screams on YouTube daily. We listened to the CDs from our FPU class on a daily basis. We read the Complete Guide to Money. We watched or listened to financial podcasts and YouTube channels like HisAndHerMoney, Rachel Cruze, Chris Hogan and Dave Ramsey. We also followed people on their debt free journeys on Facebook, YouTube and Instagram.
V – Vision. Sonya and I are visual people. We spent time talking about how our life would be when we are debt free. We constantly kept the vision in front of us.
E – Execute the Plan. I think something that separates Sonya and I from others is that we decided to execute the plan without compromise. We started the plan with 100% belief that it was going to work. The debt was paid using the debt snowball, reducing expenses, temporarily stopping retirement investing, side hustles/projects, selling unneeded items, tax refunds, monetary gifts, bonuses and a promotion.
What's was the hardest part of this journey?
Our biggest obstacle was turning down a family vacation to the beach. Another obstacle was having the courage to give up the 401k company match in order to focus on eliminating debt.
What habits did you have to adopt in order to cut down on spending?
We adopted several new habits that helped us to cut down on spending and to get out of debt faster. We started using EveryDollar.com to manage our budget and we held regular budget committee meetings. Also, we tracked all of our purchases. Sonya started using apps like Ibotta to earn a rebate on our purchases and started paying more attention to all of our purchases.
What was the most surprising part of the journey?
Our biggest surprise was how much peace there is in being debt free. So much weight has been lifted from our shoulders. We were running out of money before the month was over and it created so much pressure on us. Here I was making a six figure income but feeling like a failure because we were struggling financially. I’m fortunate that I’ve always loved my job, however when we were deep in debt I felt like a servant to my company. By being debt free I know that I could easily take a lower paying job if I ever felt that it was in the best interest of our family.
Something else that surprised us was how awesome it would feel to pay cash (~$2K) for an international vacation for Sonya plus several other smaller trips.
How did you celebrate debt freedom?
- We traveled to Nashville to do our Debt Free Scream live on the Dave Ramsey Show on July 10, 2017 See our Debt Free Scream here.
- We paid cash for a family vacation to three states (NC, VA, WV).
- We paid cash for a vacation for Sonya to Costa Rica in July.
What is your next step in terms of financial goals?
The next step in our financial journey is to continue on towards complete financial peace. Starting in September Sonya and I will have finished Baby Step 3 (3 to 6 months' emergency fund) and we will be starting Baby Step 4 (15% savings for retirement).
Any words of encouragement for folks reading?
We would like to remind everyone reading this that becoming debt free is more of a behavior change than anything else. Here are some additional tips and behavior changes that we used to become debt free.
- Attend FPU (Financial Peace University) - Don’t try to self-medicate.
- Do a written monthly budget with regular and emergency budget committee meetings. We use Every Dollar.
- Stop adding more debt.
- Track all expenses.
- Have a clearly defined WHY for becoming and staying debt free.
- Watching debt free screams on the Dave Ramsey YouTube channel (Daily).
- Tithe First.
- Read / Listen to Total Money Makeover.
- Read Complete Guide to Money.
- Study other financial resources that line up with Dave Ramsey’s teaching.
Congratulations to the Pope Family on this amazing accomplishment! Stay updated on their next steps by checking them out on Instagram!