How did we get here?

I’m talking debt and I’m not sure where to begin.

Maybe first I should shine a light on the frustration I feel towards the public school system and the way it fails to educate on helpful things such as credit, taxes, and investing.

We pick up a lot of things from our parents without realizing it. So my first lesson in debt came loaded with warnings. “Don’t do it” kinda like the sex ed scene from Mean Girls if you do it, you’d die. If you used credit cards and went into debt- you’re making a huge mistake.

I, as most of us do, ignored my dad’s warning and opened 3 store credit cards in one year at 18. I made my payments on time and felt so grown and smart.

I was thrilled by the opportunity to buy more than what was actually in my bank account. The “rewards and freebies” I got with my Victoria's Secret card were holy. I climbed the ranks to a black card with the biggest smile and best undergarments of anyone I knew.

Young me saw the limit increases and buying incentives like a kid who got to visit the treasure box on Fridays. I just kept spending.

But I also continued to make my payments on time and knew that I, for sure, was doing this whole credit card thing correctly.

Then came the time that I needed new tires for my car. I couldn’t afford it. My store credit cards wouldn’t help me here. I went to the bank and applied for a line of credit. It was thanks to these store credit cards that I had built up the credit to be approved. This was another notch in my confidence that I knew what I was doing.

I wasn’t scared of buying on credit and having debt. I thought it was what everyone does and absolutely okay and normal. Maybe it is?

Fast forward ~ 10 years later, this relationship with credit and debt has landed me in a position that seems impossible to get out of.

Matt has his own credit and debt story to tell, which is not mine to divulge here, but marriage bonds all the pretty and ugly things together, so let’s just say the debt hole widened with that considered.

Despite our sizable debt, we were able to bamboozle banks into letting us buy a home and a new truck. During all this, we never learned our lesson in credit card use. After getting the house, we didn’t have the extra money laying around to buy all the new home things that I was so anxious to get. Not to worry, I can get a new credit card for that. And I did. I also quickly maxed it out.

But everything is okay because we’re making our payments and this pattern is what afforded me all these things, I told myself. In our relationship, I always had the credit score and Matt the income to make things happen for us.

At this time, I was teaching. Something I always felt called to do and I’d say I was damn good at. I never imagined being a stay-at-home. It wasn’t what my dreams were made of. However, the day we found out we were having a girl, Friday, March 13th, 2020, was the last day of in-person school. I’ll never forget that because I love Friday the 13th and I missed that school day for this appointment. I finished out that school year teaching my 5th graders virtually while I spiraled about the safety of my unborn baby in this new covid world. The closer my due date came and the more we looked into child care- the more I realized I couldn’t do it. Emotionally and physically, I felt like I couldn’t do it. Financially, it didn’t even seem to make sense. I’d be working to keep our health insurance and to pay for child care.

Together, we made the decision for me to stay home.

The universe listened. Matt landed a pretty sizable raise with his current company which helped lend us the confidence that we could make this work. It would take some lifestyle changes but we could do it. Paying our insurance out of pocket would be the hardest part.

Not long after, Matt got a new job with an even bigger salary and we no longer had to pay for insurance out of pocket. Things were looking way up. But with this income growth came an even heavier workload which led to an increase in our spending (hello takeaway habit).

During this episode of financial gain, we got a debt consolidation loan which decreased the interest level on a good portion of our debt and also made it easier to make one big payment as opposed to a bunch of smaller ones.

Things were so good for a while (if we ignore the insane amount of work-related stress, hours in front of the computer, and family time missed Matt was going through)… Until Matt lost his job in January 2022, I was 6 months pregnant.

Gone was our financial stability, a chunk of pride, and our health insurance. Through savings and our newly cleared credit cards from the debt consolidation, we had enough to survive a couple of months before shit would really hit the fan.

My husband was rightfully burned out, angry, and ready to do something that did more to feed his soul after having it sucked dry the last few months. I, as his wife and the closest witness to all of his greatness, never ever doubted that we would be okay.

He wanted our safety cushioned few months to be the time he spent exploring what his future could be if he went out on his own. There were more months than we’re proud of where we had to pick and choose what to pay. Late and past due became too common. I didn’t even wave goodbye to my credit score as it plummeted. My belief in Matt never wavered. This man has never let me down and I knew he wouldn’t now.

He did it. He was successful. It wasn’t all diamonds and glam by any stretch, but our bills started to be paid more completely and consistently. His lone success served him so well that what was meant to be just another client, turned into a full-blown job offer.

This job was the biggest salary and benefits package he’s ever received. THANK YOU ALL THINGS UNIVERSAL (but really thank you Matt for all your hard work and effort, it never goes unnoticed or unappreciated).

Things were more than comfortable again. You’d think this is the part in the story where I tell you we got our financial act together but nope. Jokes on us. Once again, with our increased comfort came increased spending.

We are making minimum payments on our debt without a second thought. Not much was making it to any type of savings account but we were eating and living “good”.

We are about up to the present now where we find me climbing this hellish mountain of self-development.

The person Matt is is very logical and research driven. I am much more a fly by the seat of my pants kind of person. Budgets have never been my thing- how bland and boring. In our game of “let’s get our life together” hot potato, Matt has created budgets more than a couple of times and tried to talk to me about it. I’d listen and “be on board”, but they ended as failed attempts for any and all the reasons you could imagine.

I decided the next step of my personal development journey and going along with my year of less, it’s time I joined Matt in this mission of getting our debt in order.

We sat down together on a shared google sheet. We added every bit of debt we had, the total balance, minimum payment, interest rate, and due date. The total debt was dizzying. But it was there in front of us, all in one spot.

We discussed the snowball debt method (where you pay off the things with the smallest balance first) vs the avalanche method (where you pay off the thing with the highest interest first), and decided on a mix of the two.

We organized the spreadsheet to list the debts in the order we wanted to pay them off. Next, we created a sheet that listed all of our living expenses such as the mortgage, insurance, phone and internet payments, groceries, diapers, dog food, and seriously every single little thing because my man is meticulous like that.

We determined how much of our monthly income it took to cover our living expenses. Then spent time thinking of creative solutions to get our living expenses even lower such as possibly switching phone providers and canceling our cable, because it goes mostly unused anyhow. Lowering our monthly expenses is something we will keep re-examining all year long. But we found our living expenses take up about 35% of our income. Another 30% goes towards running businesses and taxes.

We are also setting a nonnegotiable saving percentage of 10% each month and are dedicated to adding anything extra automatically to our savings with our year of less. I’m hopeful to see this average come to represent closer to 25-30% of our income throughout this year.

Looking at what was left, we discussed what we were comfortable putting toward our debt efforts each month. For us, that’s 20% of our monthly income. Following our plan, we will make the minimum monthly payment on all of our debts and then drop all of what’s left over into the focused debt. As things are paid off, the number we’re pouring into our focused debt each month climbs. We started this effort in December. Just in that first month, we paid off two debts. Then in January, a third debt was fully wiped.

We felt so foolish. Had this shift in me not happened, we likely would’ve continued making minimum payments on everything until we made it to our rotting graves. Matt works way too hard and makes way too much for us to be struggling all the time.

Paying things off gives me such jittery energy. It’s hard to put into words. It’s so exciting and liberating. This feeling beats anything a store or takeaways can give me. Following our plan, we should be able to wipe our astronomical debt in less than 2 years. 2 years is just 3 blinks away.

Imagining a life, debt free, just 2 years away is enough to make me salivate. The idea is bigger than my wildest dreams.

What I’m working towards is so big on so many levels and is going to open up doors I didn’t even know would ever exist for me.

This promising future is grand but right now, this present is fantastic too. Getting there with my husband and two remarkable kids is going to make for the ride of a lifetime.