Recently, I interviewed Jackie Beck who is the founder of The Debt Myth and creator of Pay Off Debt (an iPhone app that’s helped tens of thousands of people use the debt snowball method) Jackie and her husband paid off over $147,00o in debt and she is now dedicated to helping people get out of debt and really learn to love their financial life. That sounds pretty good to me! Here’s how they did it…
A Q&A With Jackie Beck- “How We Got Out of Over $147,000 in Debt!”…
ATWS: How much debt were you in and how long did it take for you to get out of?
JB: We owed over $147,000, and we paid it off in stages that took anywhere from 5 months to 3 years each. The last stage was our mortgage, which we knocked out in 3 years.
ATWS: What type of debt did you have? What was it made up of?
JB: We were “normal”, so we had a bunch of different types: a car payment, student loan, home improvement loan, credit cards, you name it. Plus, of course, our mortgage.
ATWS: How did you feel having that much debt?
JB: Like many people, I didn’t give it all that much thought at first. (And I never even totaled it up until after we’d gotten it all paid off.) But I hated that my money didn’t really belong to me, and that it was spent before I even got it. I dreamt of the day my money would stay mine; the day we’d have a whole lot more freedom of choice.
ATWS: Is the amount of time that it took to pay off your debt longer or shorter than you anticipated it would take?
JB: I didn’t really focus on the big picture, so I didn’t have an overall time frame in mind. I know it seemed like an eternity before we got the mortgage paid off though, especially as we got closer and closer to hitting zero. It was like Christmas when you’re a little kid: the closer it got, the further away it seemed. But getting it done was awesome.
ATWS: Why was it important for you to get out of debt?
JB: One word: FREEDOM! Well ok, three words: freedom of choice :)
ATWS: Were you and your husband on the same page with getting out of debt?
JB: Yes, we were, and that made all the difference. I was the super enthusiastic one, especially at first, but then he started to get into it too.
ATWS: What methods did you employ to get out of debt?
JB: Nothing fancy. We just sent money every chance we got toward our target debt until it was gone. Sometimes we made as many as 8 payments in single month.
ATWS: What did you find proved to yield the best results?
JB: Not borrowing any more money. Your debt doesn’t really go away until you quit taking more of it on.
ATWS: What was the hardest part of the getting out of debt process?
JB: Changing our mindset so that borrowing money was no longer an option. It is SO common to look toward debt as a solution, or to be impatient, and we had to stop that. We learned to save up money for emergencies, plan for regular and irregular expenses, and say no until we had the money for whatever we wanted to buy. We bought some nice stuff during the process too — getting out of debt doesn’t have to mean a life of bread & water. We just did it with cash.
ATWS: And what was the easiest part of getting your debt paid off?
JB: Once we got our credit cards paid off, IT ALL became a whole lot easier because we automatically had more money available to work with each month. (Since we weren’t paying those payments any longer.)
ATWS: Are you still debt-free? If so, how are you maintaining your debt-freedom?
JB: Yes. It sounds simple but we’re just committed to it. That means we look for other options if we “need” something and don’t have the money, or we wait until we do. It’s actually a whole lot easier to stay debt free than it was to get out of debt.
ATWS: What’s the best thing about being out of debt?
JB: The ability to make choices based on desires instead of feeling boxed into a corner.
ATWS: What do you recommend to others who want to do what you did?
JB: Start now, and don’t stop until you get there. It’s worth it. If you want encouragement along the way, feel free to email me at comments@thedebtmyth.com. I’ll be glad to cheer you on :) (Also, check out the Community section for support!)
ATWS: What is the next step in your financial journey?
JB: We’re working on building wealth now, and are hitting retirement funds even harder than we were before. Also, my husband is saving up for a Lotus Elise and we’ve got some trips planned. Why not enjoy?
P.S. Ready to get out of debt ASAP? Check out the Spending Fast Bootcamp!
What’s great about this article is that it’s real. There’s no magic bullet. Only the courage & commitment to live debt free.
And once you start to pay off debt (without taking on any new balances) then you realize how much you actually have! You can save a lot more when you’re payments aren’t sucking you dry.
Thanks for sharing your story Jackie!
I like Jackie’s story for that reason too! It’s kind of like, “How did you lose weight?” “I ate right and exercised!”. Not the flashiest, but it’ll work every time!
Not very helpful. She didn’t even answer the question about how long it took to pay off all that debt!
I’ll ask her to clarify that answer.
As I mentioned, we did it in stages that ranged from 5 months to 3 years each. Here’s the approximate breakdown: It took 3 years to pay off the first $17,000, 5 months to pay off my student loan of $9,750ish, 2 years 7 months to pay off the next $25,500, 2 years to pay off the next $45,600ish, and a little less than a year to pay off the last $49,500.
I like how this just got to the point. Paying off debt is not easy and there is no special formula. You have to work at it and the results are nice!
I really appreciate this post- down to earth and simple. It’s nothing I haven’t thought of before, but I just got out of college and am facing a steep amount of student loan/ credit card debt, and it’s just so encouraging to hear stories from real people who have accomplished the dream. Thanks!
Am I missing something? I feel like this whole article skirted around the issue at hand, which is HOW exactly she and her husband paid off $140k…in 5 years? 3 years? They must have very high-powered careers if they were able to knock off that much debt so quickly. Paying off a mortgage in 3 years? How? I’m really disappointed in this article because it is so vague, and seems to do what lots of blogs do when venturing to talk about money: paint a pretty picture about the outcome without really mentioning any concrete facts or suggestions.
I agree completely! This article has absolutely no substance to it. How much money were they making? How much were they living on? How much was going to paying down debt? This statement, for example: “Sometimes we made as many as 8 payments in single month.” Like… eight mortgage payments? Eight payments on eight different loans? This article is completely pointless.
Neither of us have “high powered careers”. Here’s exactly how we paid off the debt: We did it over a long period of time — 8+ years — and in stages, using the debt snowball method.
We don’t have a bunch of things that many people have: a big house or expensive apartment, new cars, cable TV, people who do yard work, etc.
We went out and made as much extra money as possible to put toward our debt.
See the comment below for salary info.
What was the combined salary range for this couple?
Our salary varied a lot over the time it took us to get out of debt, and included periods of unemployment. It ranged from a combined $34K to a combined $100K during that time period — and it didn’t hit the $100K til late in the game.
During the time we earned a lot at our jobs, we also put a ton of money into other things: $33K into retirement, $10K into my son’s college, $3K into repairing my car when it was totaled, and of course taxes which ate up another $30K or so.
So how did we pay so much in the very last year when that left us only $24K to live on? We went out and earned extra money, and spent very little. (It’s a lot easier to spend very little while still doing enjoyable things once you’ve gotten rid of your other debt.)
Hope this helps.
I agree! No answers and very vague – complete waste of my time waiting for some valuable input – makes me question their entire process.
Good job Jackie.
It would be helpful to know how much your mortgage was. I live in NYC and there’s no way we could pay off our mortgage in 3 years.
This article doesn’t have all of the details, but her blog does. This is just an encouraging “snapshot” of her journey. For more details, her blog- which is linked at the top of the article- has tons of ideas and specifics. I’m bookmarking it for further reference!
How did you earn extra money? I work 10 hours per day as is.
My debt is close to $15,000 and I am just a student doing medicine as well bread winner at home. Now this debt was due to a business i was doing using other people’s money