How I Paid Off $20,000 of Debt While Still Having Fun

This guest post was written by Jesse Michelsen. Jesse is an IT consultant with a passion for personal finance. After racking up consumer debt while courting his wife-to-be, he realized the need to eliminate debt and create savings for his family. Jesse, his wife, and their two darling daughters have made great strides in reducing their debt and he documents their journey to financial freedom on his blog, PFFirewall.  


When Spend on Life asked me if I wanted to write about getting and staying out of debt as a young married couple, I thought that was an awesome idea. Interestingly enough, I haven’t even told this story on my own blog, or anywhere else for that matter.

Before I get into my journey let me tell you a story about something I witnessed recently. I listen to a small Classical Music radio station. The station is run by a local college and has been for 30+ years, yet they have no commercials. I had never really thought of how they stayed on the air but I found out that they run a week-long pledge drive. They have different people, community voices, professors and local starlets come on the station and ask listeners to contribute. I would listen to the station on my commute, fifteen minutes to and from work. Everyday they would announce a few names of people who had contributed. Everyday there were two or three more, and the radio host would always say, “Every little bit helps.” At the end of the week they announced the total amount that they had collected. It was a whopping $45,000! I was baffled. I couldn’t fathom how they collected that amount of money just by asking for it. I now believe even stronger that every little bit really does help.

With debt, every little bit helps too.

My wife and I got married young. She was 18 and I was 19. It’s safe to say we were already in debt when we got married. In the year that we dated, my savings was quickly devoured by fancy dinners and expensive gifts. On top of blowing the few thousand dollars I had saved since the tenth grade, I started spending on credit cards. I liked to spoil my girl!

I had also purchased a brand new Toyota Corolla the year before we got married. I drove that baby off the lot with three miles on her. By the time we actually got married, we had approximately $30,000 in consumer debt.

We are down to around $10,000 now, only a few years and two children later.

I’m not going to get all cliché here and say, “Just spend less than you earn!” Everyone has heard that, and if you are in serious debt, that advice isn’t going to help you. What I will tell you is how we paid off $20,000 in debt in a fairly short amount of time without going to extremes.

Firstly, before 2009, I didn’t know what a debt snowball was or that there were personal finance tips online. I had never even thought to look for tips on the internet, so if you are reading this you are already on the right track.

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What I did have was common sense. I knew that if I paid towards the debt, it would begin to shrink. If I paid more towards the debt, it would shrink faster.

The most important thing we did was to get into a routine of paying towards our debts. We kept paying the same amount or more towards them each month, even if our minimum payments went down. Soon we were paying hundreds more a month than our minimums. If we had extra money, we would put it in our savings account. If we felt comfortable with our money situation, we would take a chunk of our savings and put it towards the debt.

This routine went on for about two years. When January 2009 rolled around and I discovered the personal finance scene, I started thinking more about money and different ways we could improve our finances.

We took a good hard look at our finances, really for the first time. I wrote down all of our outgoing bills, associated interest rates, and everything we had coming in. Then I prioritized the debts to focus on first.

I took a look at the things I didn’t value as much as the amount I was paying for them. This included our internet and phone service. I felt these were too expensive, so I did some research and found less expensive solutions. I contacted our Internet Service Provider and begged for a lower rate. It was that easy. We got a rate cut of $20 a month for a year, well worth the fifteen minutes it took me to contact them. We are light cell phone users and were severely overpaying on terms of usage versus price. We switched to prepaid phone service saving us over $1000 a year.

All this and any other found money went towards credit card debt. By March of 2009, our credit card debt was gone. We could see the light at the end of the tunnel.

One thing I will tell you that we didn’t do is stop having a life. We go out to eat, socialize with others, and take our kids to fun things. We enjoy ourselves and spend on things we care about, things we value.

I know that it’s hard to start anything. I am one of the biggest procrastinators you will ever meet. I of all people know how hard it is to get started on something that you dread or that you simply feel is too much of a burden to deal with, but that is the key. Start dealing with it now. It won’t be as bad as you think.

I leave you with this final bit of advice. You don’t have to completely put your life on hold to get out of debt. What you do have to do is create a habit and stick with it. I spent some time researching and organizing and cutting back here and there but never resorted to extremes. It may seem like a long journey, but every little bit helps.

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