We reached out to Will to get his full story. He shared his debt repayment strategy with us so that others can do what he did.
He’d made sacrifices, changed habits, made a plan, and followed it with discipline. After sprinting towards his goal of being debt free, he had finally arrived. He dug his way out just short of $24,000 in debt in just nine months and one day.
Just a normal dude
There was no one catastrophic moment that put Will into debt. He says, rather, that his mistake was that he didn’t live with intention. He lived unaware of his means, and got used to living outside them. Before Will really knew how dire his situation was, he’d picked up credit card debt, a car payment, back taxes, and an IOU to his parents for money he borrowed during graduate school.
It wasn’t a struggle to pay the minimum payments. Will has an MBA, a 9-to-5, and a side hustle building websites. He paid his bills, but he didn’t feel like he was gaining financial ground. “It never really mattered how much I made. I was in a funk where I wasn’t really doing anything. I just kind of existed. I didn’t really make calculated decisions.”
The moment it clicked
As a summer counselor at a youth camp in Georgia, Will received a copy of Dave Ramsey’s The Total Money Makeover.
But it took some time for the book’s message to sink in. “When the summer camp ended, I went back to school. I dated; did this, that, and the other. I graduated and got a job. Life happened. The book stayed on the shelf,” he explains.
“I had all the information in 2006, but for some reason, my ‘come to Jesus’ moment didn’t happen until November 2013. That’s when I said, ‘Get it done now, or don’t get it at all’.”
The moment happened when Will and his girlfriend went to see Ramsey speak.
Something clicked. “We went, we sat there, and we knew it was something we needed to do. It was very motivational. We were like, ‘We need to clean this stuff up’,” he says. Will made a commitment to follow through the Seven Baby Steps Ramsey outlines in his book.
The rest is history. Will paid down a considerable amount of debt very quickly. His story is remarkable, but it’s also replicable. The system and tools he used are widely available. With Dave Ramsey’s Seven Baby Steps as a guide, he used Simple’s Goals and Safe-To-Spend® to achieve the seemingly impossible.
How Will did it
Step 1: He got rid of what wasn’t working and found the right tools.
Will had a framework for getting out of debt, but found that his old bank wasn’t providing him with the clarity or support he needed to achieve it.
“I remember sitting on my floor, fighting with [my old bank] over a fee—I think it was a lot,” Will recalls. He was arguing over a payment he thought he’d already made, but he couldn’t prove it. “I didn’t have the PDF for the statement from however long ago, and their website was difficult to navigate. I just said, ‘screw it’.” He closed his account.
It was time to go all-in with Simple. He’d played around with Goals before, but with his sights set on paying down debt, he got serious:
“With (my old bank), I couldn’t figure it out. I’m pretty smart. I have an MBA. It was just basic knowledge to say, ‘Ok. Dave Ramsey has envelope budgeting. Simple Goals are digital envelopes.’ When that clicked, it made total sense! I’ve never seen anything more Simple than Simple, really.”
Step 2: He squared up with his debt.
“A lot of people have tons of debt all over the place. They don’t even know what it is,” Will explains. He tracked down every dollar he owed, and whom he owed it to.
He then listed his debts from smallest to largest, without considering the interest rates. “Mine were perfect,” Will remembers. “They were like, $700, $1,100, $1,400, and so on. I had a perfect little step-up scale.”
Will knew that ignoring interest rates throws some people off. Conventional wisdom says that attacking the largest loan with the highest interest rate will save you the most money, but Will found that the ‘debt snowball’ method had better, intangible benefits:
“When you pay off that $158 debt, then that $400 one–and you have it up on a big board in your apartment or fridge or something–you can start X-ing through them right away, like, ‘Screw you!’ That really helps.”
Step 3: He built a budget.
Just existing from month to month wasn’t working for Will. Building a budget helped him be more strategic with his money.
“You have to make a game plan, whether you use a yellow legal pad or Simple Goals,” he insists. “You have to spend that money on paper, on purpose, so that you’re not like, ‘I hope we have enough money to go out to eat this month’.”
Will used envelope budgeting to manage his money each month. “You decide that you have $200 this month to go out to eat. That’s it,” he explains. “When you go out to eat, you spend from that Goal. When it’s empty, it’s empty. You’re telling your money where to go, instead of wondering where it went.”
(For a step by step guide to creating a budget with Simple Goals, read our post: Budgeting With Simple.)
If you’re a Simple customer, recreating Will’s blueprint for success is easy. Click or tap any of these sample Goals below to add them to your own account.
Anything left over goes to debt.
Step 4: He eliminated big expenses.
When you start paying down debt, Will suggests looking for big wins. And maybe get a little drastic:
“Sell your stuff. Your car. Your golf clubs. Your guitar.” He suggests using the extra funds to start a Goal for a $1,000 Emergency Fund. “Just get [to] $1,000,” he says. “Seem extreme? It is. It’s meant to be. The rest of this journey is going to be extreme.”
Getting extreme had its benefits. Completing this first step quickly felt tangible, and helped him build the focus and intensity he needed to get out of debt.
Will started his journey with a bang by replacing his brand new car with a used one he bought from a friend. The new car had heated seats and a heated steering wheel, bluetooth and navigation. It was beautiful, but owing lease payments didn’t seem congruent with the debt free lifestyle he was trying to build.
Selling his brand new car for a clunker seemed extreme. Friends and co-workers called him crazy, but Will knew what he was doing. Ultimately the sale allowed him to put thousands of extra dollars towards his debt.
“You can’t go lease cars that you don’t have money for. I guess you can, but you’ll never get anywhere,” Will muses.
Step 5: He developed new habits.
After selling his car, Will began tweaking his day-to-day spending habits, like dining out and buying fancy coffees.
“I eat out way too much. $8 at a time doesn’t hurt, but I started to search back through Simple and look at my monthly restaurant spend. $600 a month is just…” Will sighs.
He looked at places where he could cut back, like his $44 per month coffee subscription. He says, “I was paying over $400 a year to get coffee delivered to my door. My office has coffee!” Will used his envelope budgeting system to curb the amount he spent on delicious lattes.
But Will didn’t just cut back. He also looked for places to increase his income. “I did whatever I could to get extra money,” he says. He recognized that he could only save so much with his current paycheck, so he pursued freelance work. “I do little website design on the side. It’s an easy way to make some extra money.”
How Will changed his relationship with money
Will discovered that paying down debt is way more than just making payments. In the process of going from owing $24,000 to owing $0, he learned a lot about what it means to have a healthy relationship with money.
There’s a whole mental game that came into play when he decided to buckle down and get serious. Changing his mind was just as important as changing his habits. So what did Will do that made him so successful?
He took responsibility.
Rather than dwell on how he got into debt, Will focused all of his energy on digging himself out. He didn’t see any other options.
“It’s just one of those things where you are personally responsible,” he says. “You owe it to yourself to get that stuff straight. What a weapon you’d be if you literally could do whatever you wanted!”
He stopped competing.
Will focused on his own situation, and avoided being taken in by the flash of other people’s fancy lifestyles.
Working at a luxury car dealership helped drive this point home. He’d watch as people financed very expensive cars. “I see a lot of mistakes on a daily basis. That kind of helped, too.”
These interactions served as daily reminders that it’s better to own things instead of them owning you.
He learned to say ‘no’.
Will learned that choosing to get out of debt is making the choice not to do other things. He admits to cheating here and there along the way, but he made sure that his regular expenses were accounted for in his budget. When an opportunity came up that wasn’t in the budget, he didn’t do it.
“Dave Ramsey says ‘no’ is the best business word you’ll ever learn, and I used it a lot,” Will explained. Sometime this meant missing out, but to Will it was worth it.
He understood that money is a long game.
Will knew that he wanted to be out of debt quickly. While he didn’t want to make minimum payments for 25 years (the looooong game), he also knew he couldn’t put every dollar that passed through his hands towards debt.
If you start to lose steam and feel like quitting, Will urges you to remember that nothing happens as fast as we want it to:
If you want to do something worthwhile—open a restaurant start a business, build websites, get out of debt, lose weight—nothing happens quickly. And actually, that’s a good thing! You don’t want it to happen quick, because you won’t get anything from it.
Will recognized that he had to balance his aggressive payments with realistic financial constraints. He knew that he couldn’t pay off his debt in two weeks, so he focused on budgeting with Goals and putting as much money as he could towards debt each month.
With his precise approach to budgeting, Will became really good at understanding his monthly spending and saving patterns. He knew about six months in advance the day that he’d make his last debt payment. This was a big motivation and inspired him to save even more aggressively.
Onward and Upward
Will remembers with mixed feelings the day he paid down the last of his debt. It was exciting. That night he treated his friends to pizza and beer, guilt free.
“I get treated a little bit differently now,” Will says, “kind of jokester, like, ‘You’re Greenville’s Dave Ramsey.’”
But Will’s system and the intensity of his approach to budgeting and saving haven’t changed. “You still have to stay on the plan,” he says. “You can’t go buy a brand new car the next day.”
While his day to day habits won’t likely change, there has been an important shift of attention. He can focus on a more exciting target: building wealth for himself and his family’s future. Not owing anyone money makes Will feel empowered in a way he hadn’t before.
“I wake up, and when I go and get a cup of coffee, it’s mine. I just drink it, throw it away, and move on. It’s honestly a joy that I don’t owe anybody any money.”
Want to read more about how you can use Simple to build a budget like Will’s? Learn how Simple can help you save.
Disclaimer: Hey! Welcome to our disclaimer. Here’s what you need to know to safely consume this blog post: Any outbound links in this post will take you away from Simple.com, to external sites in the wilds of the internet; neither Simple nor our partner banks, The Bancorp Bank and BBVA Compass, endorse any linked-to websites; and we didn’t pay/barter with/bribe anyone to appear in this post. And as much as we wish we could control the cost of things, any prices in this article are just estimates. Actual prices are up to retailers, manufacturers, and other people who’ve been granted magical powers over digits and dollar signs.