YNAB BLOG

Don’t let the debt get you down

ostrichHi – jessiebird here again. The other day I came across an old debt payoff chart I had made. It listed all of our debts at the time, with balances, minimum payments, interest rates and a grand total. The five debts — including a credit card on which we owed over $10,000 —  came to a demoralizing $45,162.39.

The chart was dated Aug. 22, 2012.

That’s an important date. It’s not when we started with YNAB; that was July 2011. It was, instead, the first time I had been brave enough to write all of our debts down in one place — and that’s after we had already paid several off.

If you’re a natural-born number-cruncher who doesn’t feel like hiding under your desk every time you think about your staggering debt load, you might wonder how I could have waited so long. Well, when we first came to YNAB, I thought we’d never get out of debt. Seeing the total on paper would have confirmed what I already felt, that I was a complete financial failure. So I waited until we had paid down enough that I started to believe that maybe, just possibly, we could actually get a handle on the debt.

On the off chance there are few of you reading this who are where I was then, feeling hopeless under the weight of your own soul-crushing debt, I offer the following advice:

  1. Crawl out from under your desk; you can’t accomplish anything from there (and there might be spiders). As scary as it is, gather up all of your debts so you know what you’re dealing with. Compare the balances and interest rates to figure out the snowball payoff strategy that works for you.
  2. Focus on your whole budget, not just the debt. Do budget for the debts and pay them off as aggressively as possible, but don’t forget the importance of emergency savings, fully funded categories, a buffer, and even a little fun now and then. This is a budget, not a prison sentence.
  3. Stop letting your past mistakes define you. Yes, you’re in debt. Do the only thing you can do: Deal with it in your budget. And then stop feeling so bad about it. Seriously. It’s exhausting.

Obviously, I was a little late implementing step 1 myself. But I’m doing well with steps 2 and 3. Since I wrote up that debt chart 20 months ago, we’ve paid off around $27,000 (including all of the credit card debt). In total, I estimate we’ve paid off well over $40,000 in less than three years.

And here’s something I never thought I’d be able to say: We’ve only got $18,000 left to go.

(Granted, it would be even more exciting if I could say we were debt free. But at least I’m not hiding under my desk anymore.)

9 Responses to “Don’t let the debt get you down”

  1. Kenneth

    Jessiebird, you WERE a complete financial failure (but not as bad as I was). You have made great strides – and soon your debt will be behind you forever.

    The thing about admitting the truth and listing it out – is – you get to measure changes in it. This is very important. If the debt is still going up month after month – you have a 4 alarm fire emergency and will need to cut cut cut the spending and if necessary deliver pizzas at night. If the debt is shrinking, you are on the right track, and watching it melt (like the snow and ice here) will give you the encouragement to keep it going.

  2. Krystal

    Thank you for including the importance of balance! I have a bad tendency to try to do it all at once: pay off debt, build an emergency fund without funding the rest of my needs – or the things that I *will* spend money on regardless (a la @woolymammoth’s category types: http://forum.youneedabudget.com/discussion/29678/my-theory-on-category-types) and then I get so discouraged, I go out and blow money on frivolous things, ending up even further behind.

    YNAB has helped me be much more realistic about my budget – and I think the most important piece of that is learning to find the right balance.

  3. jbcampo

    I wonder if this includes a mortgage Jessiebird? We live in Massachusetts, where housing costs are high. We bought our house 10 years ago, then 4 years ago we refinanced down to 15 years, so we have 11+ yrs left, but still over 200k. That is not getting paid off anytime soon.

    Like everyone, we have multiple forms of debt. Student loans current spouse, student loans future for our 2 teens, home equity line of credit. It does get overwhelming. You are right. I’ve been out from under the desk for years, but more paper and debt keeps raining down. I have tried multiple times setting up plans in a debt reduction spreadsheet I’ve found online. If anyone has any suggestions for other debt reduction spreadsheets, I’d be interested.

    Jessiebird – your posts are excellent. Keep it up.

    • jessiebird

      Alas, this does not include our mortgage, which is substantial. I currently treat it as a bill — our largest — and otherwise do not obsess about it. There will be time for that once we get our other ducks in a row! I agree that sometimes the thought of the debt gets overwhelming, but I also have to say I never thought the needle would move in our lives, and it has. So, things are only getting better. :-)

      • Edsmom

        We bought our home in MA a year ago due to my husband’s work relocation (30 yr mortgage and we’re in our 50s). We also treat our mortgage as a large bill, but about 6 months ago, we switched to a bi-weekly payment plan (which fits in nicely with my husband’s bi-weekly paycheck), so at least we’ll pay off the mortgage a little earlier. Thus, we’re concentrating on paying off the other credit/loans, not worrying about the mortgage, and we’re sleeping a lot better. Just a suggestion.

  4. jcw3rd

    Well done Jessie. Keep up the good work and one day you too will be FI (financially independent).

  5. Emily

    Considering our student debt, which is our only debt, is a staggering 170k+ for two law school graduates from a private school (yikes! What were we thinking?!?), I have not been brave enough to write it down in one place. I am just focusing on the smallest balance, just get it down, and pay it off in one year. After that, we tackle another. Like you, I think I will take the “write it all down in one place” step after we have a few tens of thousands knocked out first. Baby steps…baby steps. Thanks for the great post!

  6. Charger Girl

    Thanks jessiebird. I have been struggling with this exact issue sense I crawled out from under my desk in Jan. It has been difficult dealing with the fact that I will be over 40 by the time I get my debt payed off. I try to see the success as the number of months it will take to payoff gets smaller & smaller (Payoff date started of as Jan 2023 and is now at April 2020) but haven’t been able to see it that way. Maybe now I’ll be closer to giving myself a break. Thanks for that ~CG

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