Michele Paid off $120,000 Debt

How One Couple Paid Off $120,000 of Debt in 10 Years

What Life is Like on the Other Side of Six-Figure Debt


When you see debt payoff stories in the six-figure range, you might think they’re software engineers, or maybe they won the lottery. But this couple paid off $120,000 with normal jobs while living in an expensive area, becoming parents, and going through two bouts of unemployment in the middle of their debt payoff. Now they’re debt free—and they have been since 2015. They did it, and you can too.

Michele’s Story  

Michele and her family during their season of debt payoff

We Had $120,000 In Debt

In 2005, I was graduating from college with a history degree and $20,000 of student loan debt. My then-boyfriend (now husband) had $60,000 in student loan debt. We both had car loans—and our debt combined was close to $100,000. 

I went to grad school and got my Master’s in Library and Information Science, and added another $20,000 of student loan debt to the total: now up to $120,000. 

We were paying $1,000 a month in student loans. It was crippling. We were stuck, we couldn’t move, and we were limited in our choices.

We Made a Plan and Had Some Setbacks

So, we made a plan to pay off the debt and got started. I say “we,” but honestly it took a bit to get my husband Rob on board. But once he saw the value of paying off our debt, he was all in. 

The first thing we paid off was a car loan with a $3,000 balance—that went pretty quick. I consolidated my loans to get them down to one payment and lower my interest rate. We started gaining momentum.

Around 2012, I found You Need A Budget through a blog I was reading. The method made so much sense to me. I didn’t use the app, but I started using the Four Rules method immediately. I got a Fat Lil’ Notebook and started recording everything we spent. Every day had a page—and I eventually moved it all to a spreadsheet. That’s when things really started picking up steam. 

The true test of our financial health came when my husband was laid off four days after our daughter was born in 2013. Talk about terrifying.

We’d been using the YNAB method for a while by that point, and we had some money set aside. For me, that made it less stressful than it could’ve been.

Between our savings, his severance, and a few odd jobs, we realized we could make it for a few months, and he could be home with me and our new daughter. Don’t get me wrong: we were both relieved when he started working again in January, but what could’ve been a full-stop surprise ended up being a sweet time for our family.

Things We Did to Pay Down Debt

We kept going on our debt payoff. A few things we did:

  • Meal planned
  • Limited eating out (which was pretty easy as new parents)
  • Picked up side hustles (I worked a few hours at a community college library and my husband drove a wine tour bus)
  • Called our internet provider and got a lower rate
  • Switched cell phone plans to Ting
  • Had BBQ/dinner parties at friends’ houses instead of going out to eat
  • Stopped shopping for extraneous items
  • Took advantage of clothing swaps with friends and thrifting
  • Prioritized time over expensive experiences (like going hiking instead of to a Cirque du Soleil show)

One day at a time, one dollar at a time. I had to remind myself we weren’t going to pay it all off tomorrow, and we celebrated each win. If you look at it like it’s a big mountain, it’s going to feel insurmountable. Instead, I just looked at it as “I took another step today. Yay!”

We Paid Off Our Debt

After ten years of paying down our $120,000 of debt, we wrote the last check with the help of a small windfall and finally became debt free. I remember looking at each other after all those years of paying off what seemed an insurmountable number, and I’ll be honest, it felt almost anticlimactic. We had spent so much time and so much energy in paying off our debt that you wonder, is there any more to finances? Sure enough, there is. We could build an even bigger cushion to prevent us from going into debt ever again. And there’s still plenty more to learn.

Michele and her family at a recent Halloween

We’ve stayed out of debt. We’ve made up for the travel we wanted to do in our 20s—taking our daughter to Europe, going on a girls’ trip to Austin, my husband went to Colombia, we visited Ireland and Northern Ireland, the list goes on.

But more than buying things, doing things, or traveling to different places—now we can make the lifestyle choices we want. We moved where we wanted (San Diego), we took the jobs we wanted (I now work as a YNAB Customer Support Manager and Rob is a Beer Brewer), and we can make those choices now. That freedom is priceless.

Michele is a Customer Support Manager and Training Owner here at YNAB. She put aside her spreadsheet days long ago and now helps others use YNAB and make their own jump to financial freedom.