Credit cards, medical bills, and student loans carry overwhelming balances for many Americans.
And it takes some people a lifetime to pay off their debt.
But we found a couple who erased tens of thousands of dollars in one year.
“That year, we made $48,000 and we paid off 30,000," says Marcus Shields, a middle school teacher.
“So we lived off $18,000,” adds his wife Jenny Shields. “Which was very tight.”
So how did they accomplish something so many of us have trouble with? They chalk it up to determination and discipline.
“It was really uncomfortable for 12 months,” said Jenny. “But then our debt was gone."
Jenny is a doctorate student, and the couple just welcomed their first child.
To reduce the financial stress of parenting, they focused on their outstanding debt, which amounted to nearly $30,000 in student loans.
They started with a DVD from a money expert and a very colorful spreadsheet.
“We have what you call a ‘zero-based budget’,” says Jenny. “So, we know what's coming in, and we say exactly where every dollar is going to go."
They then tightened the purse strings and found creative ways to make ends meet.
“We were selling clothes,” says Marcus. “I was selling instruments that I don't play on. The video games went away."
Their food budget was a mere $50 a week.
They switched cell phone plans, cut out morning lattes and spent less on haircuts to save money.
“I'd say you're going to feel like you're not normal,” says Jenny to others who want to pay off mounds of debt.“You're going to have to go against the cultural grain of what everyone else is doing.”
Larry Rosebure has been a credit counselor in Tulsa for 20 years, and he says people usually come to him about a year after he wishes they would.
“We prefer to see people when it's just starting to get out of control,” said Rosebure.
His agency, Christian Credit Counseling, likes to first put a person’s income and expenses under the microscope.
“Come in and learn how to do a sound balanced spending plan every month before you get in trouble,” he says.
He adds, it doesn't matter how much money you make, he sees people from every walk of life who fall into the same trap of unbalanced spending.
“We all have to be really honest about every spending decision,” he says. “Is this a need or a want?”
The Shields made tough sacrifices to pay off their debt, but they say you have to find your own motivation. Theirs was starting a family.
“Figuring out what your 'why' is,” she says is key. "If that is having kids or getting a house or just wanting to live without the stress that your parents have felt.”
They held themselves accountable with a chart on the wall, and colored it in until they made their final payment.
“It was surreal,” Marcus remembers about the moment they became debt-free. “Impactful. It was very impactful."
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