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How We Paid Off $78,000 in Debt in Less Than Two Years

Newly married, the Smiths were united in their goal to pay off nearly $78,000 of debt. Here's how they did it, and you can too.

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How We Got Out of Nearly $78,000 of Debt in Less Than Two Years
Courtesy Jen Smith

Debt is the new normal

A recent study by Northwestern Mutual estimates the average personal debt of Americans to be over $38,000—and that doesn’t even account for home mortgages. In 2015, Jen Smith and her now-husband Travis owed almost twice that much. When they got engaged, Travis told her he wanted to pay off his student loans. “I immediately told him no. I didn’t want to waste my 20s living under a rock just to pay off debt that everyone else seemed to be fine living with. I truly thought that living life to the fullest meant living paycheck to paycheck.”

Despite her initial reservations, Jen eventually got on board, and the Smith’s journey toward a debt-free life began. Today Jen teaches others how to live more frugally and promotes a minimalist lifestyle through her blog Modern Frugality and popular podcast Frugal Friends.

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Setting a big goal

Jen and her husband had a combined total of just under $78,000 in debt, the bulk of which came from student loans (around $74,000) and the remaining $4,000 on Jen’s auto loan. Initially, the Smiths thought they would need around five years to reach their big goal of debt freedom, but they soon became great savers. These are the 17 habits of people who are great at saving money.

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The numbers

Eventually, Jen and Travis were able to put $3,000 a month toward paying off their debt. It’s an impressive amount, but you’d be wrong to assume they must have been earning an obscene amount of money to pull that off.

Jen’s annual salary at the time was $30,000 a year, plus she earned $12,000 extra from two side jobs. However, her portion of the debt ($54,000) was considerably more than she earned per year. Travis was unemployed at first, but within two months he found a job that paid around $40,000 a year. So together they were earning about $24,000 more than the median household income reported by the United States Census Bureau, which was $56,516 in 2015, when the Smith’s debt-free journey began.

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Saving on housing

Jen attributes a big part of their success to the commitment she and Travis made to leading a more frugal lifestyle. At the top of their list was housing, which can be a big opportunity to save for renters like the Smiths. Living in St. Petersburg, Florida, they were able to downsize to a smaller apartment and negotiate a few extra perks from their new landlord. The rent for their new apartment was $750, which included water and sewage (the negotiated perks). “We found cheap housing by searching neighborhoods rather than using the web. It was much lower than the average cost of housing in St. Pete at the time because it wasn’t listed online yet.” The lower-priced apartment with utilities included saved the Smiths $250 per month. Great win! Here are an additional 56 almost effortless ways to save money.

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DC Studio/Shutterstock

Saving on groceries

Another big-spend category for many households is food. Jen and Travis saw that their monthly grocery bill represented another chance to save a considerable amount of money, and they took advantage of it. “We switched from shopping at our premium grocery store (Publix) to Aldi,” Jen recalls. The switch saved them as much as 50 percent on everything they bought. “That along with meal planning and shopping only sales got our grocery bill down to $50 per week from $100.” All combined, the Smith’s new grocery shopping strategy added an impressive $200 per month back into their budget, and they were able to channel that toward their debt liquidation goal. Don’t miss these 19 tricks frugal shoppers use to save big on groceries.

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Car door

Saving on auto expenses

Jen and Travis were also willing to make sacrifices when it came to the vehicles they drove. Once their auto loans were paid off, they continued to drive their older model cars, which saved them the potential cost of new car payments. Additionally, the insurance on their older vehicles was very affordable. “I’m not sure exactly how much we saved with auto insurance, but I know the average cost to insure a new car is around $118 per month. We were paying that for full coverage on two older cars.”

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Studio 72/Shutterstock

Side jobs

Another key part of the journey for Jen and her husband was finding creative ways to earn more money. In addition to their full-time employment (Jen was an acupuncturist and Travis was a licensed aircraft mechanic), Jen recalls the many ways she and her husband earned extra money. “I worked at a foster group home, did online data entry, and did acupuncture at a drug rehab center. My husband Travis drove for Uber, biked a pedicab, and picked up hours at a local airport hangar doing paperwork.”

You might be wondering, how did they find the side jobs? In the Smith’s case, it was simple: “Once we decided to take on more jobs, the jobs just kind of came to us. I quit the foster group home I’d been working at before we got married, then, coincidentally once we started paying off debt, the foster group home called and wanted me back to help out. I found a data entry position online and the rest we found through word of mouth.” Those side hustles brought in an average of an extra $500 per month. If you’re looking for ideas for ways to earn more money, here are 10 ways to make money fast.

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A 23-month success story

Although the Smiths originally thought they would need around five years to eliminate the nearly $78,000 debt they carried, it only took them a short 23 months to accomplish their goal. The journey was hard. It required sacrifice. But, it was ultimately worth it. “Two months into our debt-payoff journey,” Jen recalls, “I contracted shingles from a combination of stress and exhaustion. I jumped into too much too fast, and my body literally couldn’t handle it.”

But she made adjustments and didn’t let it set her back. “After the shingles outbreak, I started focusing more on cutting our expenses than taking on more work. That’s why our side hustles rarely went beyond $500 a month.”

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How We Got Out of Nearly $78,000 of Debt in Less Than Two Years
Courtesy Jen Smith

Unexpected benefits

When asked how paying off so much debt has changed their lives, Jen has a hard time choosing just one way. “You know, it sounds crazy but it was all worth it, even the shingles. The changes [to our lives] have all been positive.” That said, one surprising benefit sticks out the most; Jen says the process helped solidify their marriage and taught them to work together as a team. “Paying off debt together was the first task we took on as a married couple and it established how we handle hard things—disagreements, compromise, all those things that come with tackling a difficult task. Now we take those skills into other areas of our life together and we communicate so much clearer.”

Michelle L. Black
Michelle Lambright Black is a credit expert, finance writer and travel writer with nearly 20 years of experience. She's also the founder of CreditWriter.com, a judgment-free personal finance community for busy moms like herself. When she's not writing about credit and money, Michelle loves to travel with her family of five—usually to somewhere sunny and warm.