There are Conformists, and there are Rebels.
The Conformist Majority says: “I have a 30-year mortgage, a 20-year second mortgage, a 10-year student loan and a 5-year car loan.”
“I’ll pay the minimum, and hold those debts for 30, 20, 10, and 5 years. After all, why deprive myself while I’m young?”
Worse, they’ll ask:
“How can I stretch these loans out even longer? A lower monthly payment means I can get granite countertops. Score!”
They tell themselves this is normal. And the scary truth is, that’s true. It IS normal.
But it ain’t right.
Then there are the Rebels.
Like all humans, Rebels aren’t perfect. They’ve made mistakes — sometimes gigantic mistakes — but they don’t get defensive and wallow and make excuses. They get powerful.
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They morph their missteps into the rocket fuel that powers their inner strength. They stoke the fires of ambition and optimism and a take-no-prisoners empowerment attitude. They defy the conformist cultural norms that whisper “follow the crowd” and instead, in an act of ultimate rebellion, break the debt shackles that bind their wrists. They are free; they are powerful; they are us.
Ladies and gentlemen, meet three amazing rebels.
Rebel #1: Jackie and Miles Beck
Total Debt Conquered: $147,106
Type of Debt: Credit cards, student loans, car loan, home improvement loan, mortgage
Time Period: 2005 – 2012
Words of wisdom: “Becoming debt-free is do-able, so long as you’re willing to do what it takes.”
Their Road to Freedom
At the peak of their debt, Jackie Beck and her husband Miles had racked up $17,000 on credit cards, $35,000 in a combination of student, car and home improvement loans, and a $95,000 mortgage balance. (They both entered their relationship with existing debts.)
The consequences of this debt came to light when Jackie read a little book that radically transformed her perspective on money. This book, Your Money or Your Life by Vickie Robin and Joe Dominguez, is a financial freedom classic: it shows that you trade your most limited and precious assets, time and energy, for money — and this is, by definition, an unsustainable exchange.
Jackie and Miles realized they need to revolt against the norm — and that starts with decimating their debt. First, they tackled their credit cards, using a consumer credit counseling service to negotiate a three-year payment schedule.
Most people would be happy to stop there. But they’re Rebels. They kept going.
Next came Jackie’s student loans, Miles’ car loan and their home improvement loan —- Bam! Bam! Bam! They wiped out another $35,000 over three more years.
The last step was tackling their mortgage, which had a balance of $95,000. From 2009 to 2012, they threw every penny at paying this down, managing the impressive feat of paying down the last $49,500 over the course of just one year. Boo-yah!
How did they do it?
The road to freedom isn’t always smooth.
At one point, Jackie lost her job and remained unemployed for four excruciating years. But she created her own opportunities: She launched her own business (while job hunting) to replace some of her lost income.
She eventually found a job that paid $2,100 per month. “After years of living on nothing … it felt like a fortune to me, and I decided to pay off my long-deferred student loan, which had a balance of $9,759.46 left on it,” she says.
She wiped out that loan in 5 months. Boom!
That’s commitment, folks. You have to want it.
“I woke up every single day thinking about how I could pay off the debt as quickly as possible,” she says.
The couple didn’t encounter smooth seas throughout their entire journey. In addition to Jackie’s prolonged unemployment, they faced plenty of unexpected expenses: surgeries, emergency vet visits, even a car accident that resulted in major repairs. Yet they kept a laser-focus on their goal.
Here are some of their tips:
- Transform your lifestyle. They’d been funding their lifestyle through debt. They learned to instead focus on building savings and acting resourceful. A little creativity and hustle goes a long way.
- Give every dollar a job. When Jackie brought in extra money through her side business or Miles brought home extra money through odd jobs, they threw as much extra cash as possible towards paying down debt. They didn’t give into lifestyle inflation; they stayed focused on their ultimate goal.
- Start small. When they decided to pay off their mortgage, they started with a tiny step: pay an extra $35 a month. Once they achieved that small victory, they scaled up.
- Be patient. Jackie describes the debt payoff journey as a “hockey stick” —- if you viewed it on a graph, it would look like a lot of gradual progress over a long period of time, then one final up-tick at the end. The trick is to stay motivated and focused on the long-term goal, even when it feels like you’ve got a way to go.
Read this story on their website, The Debt Myth.
Rebel #2: LaTisha Styles
Total Debt Conquered: $32,000
Type of Debt: Credit cards, car loan
Time Period: 2011 – 2013
Words of Wisdom: “I got into the habit of saving more and spending less.”
How She Kicked Butt, Paid Off Her Loans, and Lived Happily Ever After
I’m ultra-proud of my friend LaTisha Styles. I’ve watched her throughout her 2011-2013 debt freedom journey and, damn, this woman is COMMITTED.
Shortly after I met her, I told Will: “LaTisha is destined for success. She’s got the hustle, the heart. She’s got the brains and the fire in her belly.”
And I’m besides myself with joy to see her now: Debt-free, self-employed, location independent, and in amazing physical shape. Yeah girl!!
When LaTisha decided to get serious about paying down her debt, she was already delinquent on her accounts. Without a job lined up after graduating from college, she’d been living with her parents and hadn’t been making payments on her loans. She was getting nasty calls from creditors. She was stressed.
When she landed a job, she took action. Over the course of three years, LaTisha paid down her debts and developed a laser-focus on controlling her spending.
She came up with a strict budget. Check it out:
Monthly Income: $3,949
Rent, Food, Gas, Electricity, etc: $1,738
Look closely at those numbers. LaTisha saved 56% of her income, while making less than $4,000 per month. She spent more money on decimating her debt than she spent on rent, food, gas and every other bill, combined.
What happened after she decimated her credit card debt and car loan?
Monthly Income: $5,178
Rent, Food, etc.: $2,180
She increased her savings by an extra 2 percent! She’s now saving 58% of her income!!!! Yeah!!! (Note: The naysayer conformist trolls who like to foist their own internal self-doubt on other people will say things like “Only rich people can save 50% of their income.” To those people, whomever you are, I point to LaTisha’s example. Case closed.)
LaTisha’s next big goal is paying off her $65,000 in student loans over the next three years, traveling internationally, and getting married (with an ultra-frugal wedding) this March. (I’ll be there!)
Conformists view their first post-college full-time job as an excuse to live it up after years of slumming it as a student. But LaTisha wasn’t afraid to rebel against that peer pressure and think outside the bars.
Here are some of her winning tactics:
- Budget, budget, budget. She knew where every dollar was going. She planned out her month’s expenses and structured her budget around her main financial priorities (decimating debt). She paid for things in cash only to avoid temptation, and she gave herself a $50 cushion each month so she felt she had a little breathing room.
- Know the difference between needs and wants. LaTisha realized a good portion of her debt came from impulse purchases. She loved shopping and dining out, but she learned to find other ways to entertain herself, like playing dodge ball on the weekends. She also taught herself to resist the urge to buy things on the spot, even (especially) when they’re on sale.
- Shop smart. LaTisha has a ridiculously low food budget (between $51 – $81 a month). She stocks up on sale items, freezes what she won’t use immediately, and went vegetarian for a while to eliminate the cost of meat.
Check out more on her website, Young Finances.
Rebel #3: Travis and Vonnie Pizel
Total Debt Conquered: $109,000
Type of Debt: Credit cards
Time Period: 55 months (2009 – 2014)
Word of Wisdom: “The most important thing I’ve learned during this process is that being a provider for my family doesn’t just mean buying everything they want. The root of our financial problems was the simple error in judgment of equating saying ‘No’ with failing as a husband and as a provider. A true provider does what is best for the long-term success.”
Their Amazing Journey
The Pizels’ debt story is one that’s all too common. Travis is a software engineer. He and his wife Vonnie earn a combined six-figure income, easily enough to take care of their two children. They live in Minnesota, where the cost of living is reasonable.
Then Travis opened one credit card, which soon become three credit cards, and before he knew what had happened, he had 13 open lines of credit, started hiding debt from his wife and began staying up at night trying to figure out how to keep the family afloat.
At the height of their debt, the Pizels owed $109,000, which they’d accumulated over a decade. When one of their creditors increased the minimum monthly payment, the bottom fell out.
The Pizels couldn’t pay the higher credit card minimums, which required several hundred extra dollars each month. They had reached a wall: they either needed to find a way to deal with their debt, or face bankruptcy.
The Pizels found a debt management company that helped them lower their interest rates and develop a 57-month payment plan. This plan didn’t just aggressively help them pay down their debt, it also eliminated the risk of falling back into debt by freezing their credit accounts.
They paid $2,489 per month for 55 months.
Here are some of the key strategies that helped the Pizels escape from debt:
- Question everything. At first they began with the “normal” spending cuts — get rid of the landline, cable TV and restaurant dinners. But then they had to get creative. Weekend trips? Gone. That 500-gallon hot tub in the backyard? Gone. School fundraisers? Sorry, kids — Mr. Travis going to have to say no, but he’ll support the school by volunteering for the PTA Board.
- Get crafty. The Pizels became Do-It-Yourself masters. Toilet broken? Instead of dialing a plumber, Travis learned to troubleshoot. Wife needs her hair colored? Yep, stylist Travis does that, too.
- Get your family on board. Travis and Vonnie made the bold choice to be transparent with their kids. They told the children that they were in debt and explained how it would affect their family. This not only made it easier to explain the sudden budget cuts; it also taught their kids great lessons on money management.
(Their 10-year-old daughter Tori wrote an amazing blog post about the experience. “Mom explained to me how debt is when we spend more money than we had and we had to pay it back,” she says. “… I know now that if you don’t have a budget and you spend more money than you have, you’re in big trouble!”)
Travis writes at Enemy of Debt.
How ’Bout Those Numbers Now?
If you’re battling debt, but feel yourself succumbing to a moment of temptation, think of these three kick-butt Rebel warriors.
If you hold the limiting belief that your situation will never improve, let these three stories dismantle your negative self-talk.
You can be debt-free — and it doesn’t have to take the rest of your life to do it. In fact, you can master your money in just a few years.
You don’t have to be like the average American household. Reject the Conformists. You’re different. You’re a Rebel. You’re a success story, teetering on the cusp of becoming real.
Your turn! Did you crush your debt? Are you in the process of shedding your loans? Share you success in the comments — no balance is too big or too small.
Afford Anything staffer Kelly co-authored this article.