They Demolished $89k in Debt While Raising 2 Kids

“We were literally those naive kids, with kids, who were learning the meaning of being a grown up. It was a harsh reality check.”

Jaklin is a 25-year-old licensed customer service representative. Her husband, Ryan, is a 25-year-old, full-time student at the University Nevada, Reno, and works as a part-time courtesy clerk at Walmart. Together, they have two young boys, ages four and six.

A Humble Start

Married life hasn’t exactly been a cakewalk. Jaklin said, “The day we got married, we had exactly $400 to our name. Two weeks later, we had our first son. And two weeks after that, we packed everything we owned into our Ford Taurus and moved five hours away, across state lines, to go to a private college.”

To survive, they applied for student loans. Jaklin said, “We just took out the maximum number of loans and lived off of that. I got a student job that paid a student wage, making about $350 a month. We were exhausted all of the time and constantly yelling at each other about finances. Then we got pregnant with our second son. That was our reality check—we needed to do something and fast.”

It Was Time to “Adult Up”

To make ends meet, Ryan stopped classes and, instead, worked full-time as a cashier. Jaklin continued working at her university job, and they said “yes” to every free hour of babysitting they could get.

Their monthly expenses came to about $1,000, but their combined income—including student loans—was only $850. It was tough but, as Jaklin said, “We felt that it would be taking an even bigger step backwards if I were to quit school.”

It was clear that they needed a budget, but unexpected expenses, such as overdraft fees, their license plate renewal or glasses for their older son always seemed to mess up their plans. Jaklin said, “We would just give up for the month and [plan to] start over, again, next month. Finally, when I graduated in June 2015, we sat down and decided that we were going focus on our budget and not make any more excuses. It was time to adult up.”

If, at First, You Don’t Succeed …

So, facing $89,000 in debt, Ryan and Jaklin got busy. First, they tried budgeting with good, ol’ fashioned pen and paper. Jaklin said, “We found that unexpected expenses would trip us up, and we’d have to erase, erase, erase.”

Frustrated, they moved on to Mint, but that didn’t work for them, either. Jaklin said, “All of our progress would be erased at the beginning of each month.”

Then, they tried EveryDollar. Nope. As Jaklin said, “It was monotonous.”

They even tried using Excel, but that proved too time-consuming to maintain.

Then They Tried YNAB

When they (finally) tried YNAB, the first thing that struck Jaklin and Ryan was how flexible it is—both the app and the Four Rules. If something unexpected pops up, all is not lost! They can lean on Rule Three and shift their budget around.

Jaklin also loves YNAB’s spending reports, the ability to see her net worth at a glance and set savings goals and, perhaps most of all, direct import. She said, “I call it ‘syncability,’ and I love that particular feature so, so much. And, yes, I just made up that word, and I use it all the time.”

To keep tight tabs on exactly where they are in the budget, Jaklin and Ryan also enter transactions on their phones. Jaklin said, “We can put in a transaction and, then, BAM! it’s adjusted. If we overspend, it’s an easy adjustment. It’s a reality check on what we are doing in the here and now so that our future can be what we want it to be.”

Liberation & Progress

Once they’d gotten into the rhythm of budgeting, a funny thing happened. Jaklin and Ryan stopped feeling so stressed about money. Jaklin said, “I used to think that money was evil because there was never enough around. Now that I’ve been budgeting and using YNAB I know that it is just a tool. The finite amount that we have at any given time can be molded and shaped to what we need it to be.“

Now, that’s a winning attitude which, coupled with their budget and a rise in income—from $10,000 to $38,000 per year—is really paying off! Since they began using YNAB three years ago, Jaklin and Ryan have:

  • Paid off $14,000 in debt (Their $89,000 debt is now $75,000, and they’re on-track to pay it off, in full, by 2020!)
  • Increased their net worth by $24,700 (Rising from -$85,400 to -$60,700)
  • Kept their savings at $2,000, minimum, for the past year
  • Contributed to their retirement fund
  • Avoided overdrafts—and the dreaded fees—for the past three years (at one point, they had seven in a single month!)

Plus, they allocate money for his and her discretionary spending categories and even budget some money for each of their sons.

Jaklin said, “I want my kids to learn how to manage money so, every two weeks on payday, $25 is automatically deposited into each of their savings accounts. I made a separate budget sheet for the boys, and I help them break down their money during a mini-budget meeting for each of them. $10 for College/House/Vocational School, $10 for a long-term goal, and $5 for spending money.”

The boys love it. Jaklin said, “My 6-year-old is saving for a Lego Knighton Castle ($130), and my 4-year-old is saving for a child-sized car ($300), but I’m sure he’ll change his mind in a couple of months. They can use their spending money for what they want, as long as it fits within their budget. They also have the responsibility of family birthday gifts and holiday gifts.”

Their New Normal

These days, Jaklin and Ryan rarely argue about money. Jaklin said, “We went from never, ever talking about money to constantly fighting about money to being able to talk in absolutes about what we have, what we don’t have, and where we want to be with our money. We can cover those unexpected expenses without a fight. No sweat.”

And, those meaningful money conversations are gold! But you don’t have to tell Jaklin. She said, “Achieving our goals no longer feels like a haphazard dream that likely won’t come true. Now, we’ve got a road map of exactly what we want, what we have to do to reach those goals, and a time frame for when we’ll make them come true. We also have ‘rest areas’ planned along the way to celebrate at different milestones.”

They’ll continue to chip away at their debt, but now Jaklin and Ryan also look forward to buying their first home, one with a yard, getting a dog and a cat, and having more kids.

Don’t Let Overwhelm Thwart Your Success

If you’re struggling, Jaklin’s advice is: “Start by thinking about what you want to accomplish in your life. Look at the obstacles that you’ll need to face, and break them down into manageable pieces … then demolish them. And, don’t forget, sometimes in order to move forward, you have to purposely take a step back so that you can get a better footing.”

Ready to get started? Drop into our free, online workshop, Learn the Four Rules. It’ll be a good use of twenty minutes—and don’t forget to bring your questions!