Finances & Money

When you put your mind to it…

…you can accomplish anything. That’s what I realized today while discussing our debt with a friend. You see, I know how much debt we started with ($112,890), and I know how much we have remaining ($54,737), but I never thought about how we got down to that amount.

$112,890 – $54,737 = $58,153

In the last 2.5 years, we reduced our debt by $58,153. Technically, it was a bit less than that due to some very minor student loan principal payments, but those are negligible in the big picture.

How that $58k breaks down

  • Auto Loans: Paid off $30,702 since March, 2005
  • Credit Cards: Paid off $14,148 since April, 2006
  • Student Loans: Paid off $13, 303 since, well, the last 5 years. I’d say that a large majority was paid in the last 2 years though since the first 2 years were all interest (stupid me), and the next 3 were not much more.

How did we do it?

Sometime in 2005, I realized I was tired of our debt. It was really holding us back from even thinking about our long term goals. We felt we weren’t as mobile as we needed if we wanted to move to a different area, or if one of us needed/wanted to be a stay-at-home parent. I will admit, though, that in the last 2 years, three job hops by me and one by my wife have significantly improved our earnings by about $41,000 per year total. Not everyone can improve their earnings, but there are other things we did.

1. We spent less. We now restrict dining out for dinner to just weekends and special occasions (out of town guests, birthdays, etc.). Our monthly grocery and dining budget are $200 each, and we stay within that budget, usually. Also, we only have basic $20/month cable.

2. We don’t buy crap. Yeah, that’s right. I don’t buy gadgets. My wife doesn’t buy pricey clothes or knick-knacks. The most spending we do is on home improvement, and even then we keep it simple and inexpensive.

3. We fix things ourselves. We repair our home problems ourselves. I change our engine oil myself, along with some other more major repairs (like replacing transmission fluid in the Pontiac). We simply figure out how to do stuff ourselves rather than calling for help. Oh, and it helps to have an amazing handyman in the family to guide us.

None of these things is a significant savings by itself. Sure, we maybe save $600-1000 per year with basic cable, or $100-200 per month on dining out less, but it all adds up to help us send more towards our debt.

Put your mind to it!

You may have less resources that us, and you’re thinking “I can’t pay down my debt like Mike and Stacie did! Why should I even try?”. You’d be amazed in how much you can accomplish if you put the spotlight on your debt. Think about how much it’s holding you back, or weighing down on you every day, and you’ll soon realize it’s time to do something about it.

Here’s a quick guide to starting your debt reduction journey:

  1. Look for big savings: Can you sell a car that you don’t need? Can you sell that pricey car and downgrade to a used one for thousands less? Can you cut out those dance/music lessons or recitals for a year to speed things up?
  2. Look for smaller savings: Cut down your cable bill. Switch to Vonage (let me know if you want an affiliate link) or just cut your home line altogether. Downgrade to DSL if you don’t need cable internet speeds. Reduce your dining budget and stick to it.
  3. Look for more income opportunities: Perhaps you can ask for a raise at work. Or if you’re really dedicated to this debt thing, get a second job (one that’s fun). It turns out this blog generates a little funny money to help pay for some unexpected expenses (like the new pool pump, or Stacie’s birthday gifts). It’s small, but anything helps.
  4. Sell your stuff: Need I say more? We’re selling our Malibu because we just don’t need it right now. That could be $10-11k towards our savings or other debts. I’m also itching for a yard sale, but that might be more work than it’s worth.
  5. Reduce your interest rates: Call the credit card companies and ask for a lower rate. Refinance your auto loan if it will bring in a decent savings. Transfer your debt to 0% cards if possible, but make sure you can pay it off before the rate resets.
  6. Look for tiny savings: This is where things can be either painful or fun. Personally, I like to have a little contest with myself sometimes to see how fast I can shower, or how long I can make a tube of toothpaste last. Overall though, you may find frugality isn’t worth the time and effort to earn smaller savings.

So put your mind to it and get out of debt already! If you’re really in trouble, see a credit counselor (perform due diligence to make sure they’re reputable though). They can help you to work with creditors to get your payments more in line with what you can afford. At the same time though, try cutting your costs. You’ll be amazed at how much change you can find in the couch cushions when you just take a peek!

About the author

Clever Dude


  • Thanks for the nudge! πŸ™‚ You guys are really disciplined. Our own strategy is just not to buy stuff unless we can pay for it in full except for the house which we need a loan for… too expensive in California to afford a house without a loan!

  • Great job on the debt reduction Clever Dude. With the raise especially, it is a great time to pay off debts because you are used to living without the money, even a $0.50 raise is an extra $960 a year for debt payoff. Another thing to look for is additional coursework that would qualify you for a higher position than you are in now, especially if your employer will pay for it. (free education and more pay, a double whammy)

    I looked into consolidation options after we got married, and instead of paying 10 seperate bills, we pay one big one twice a month (we only have to do it once) The result? we shaved 4 years of debt repayment down to 1 and a half.

  • That is some great work Mike, the raises were a very strong part of the equation. I still contend that dumping the auto debt, which get you out of debt much quicker.

    Good luck on the Master’s too, I will have 4 classes left after august! I would make sure that you have a heavy personal interest in attending, because I definitely think I could have learned more on my own in a shorter period. I have enjoyed the journey, but mostly for the personal growth.

  • Wow. There are some of us (i.e. me) that do well at controlling their finances, but then there are those of us (i.e. Clever Dude) that dominate their finances.

    Keep up the great work.

  • I am amazed by the $200 a month grocery budget, particularly since your wife is a dietician, so I’m sure you guys are finding ways to eat healthy meals on that kind of money. I find that buying quality ingredients (like fresh fruit, vegetables, whole grains, lean meats & fish etc.) can be so expensive, but that is one area where we feel like we shouldn’t skimp. I’d love to read some tips about how you make that happen (maybe on your wife’s blog?).

  • […] Clever Dude shows how he reduced his debt by over $58,000 […]

  • Your success is amazing and inspiring! I hope to be able to knock out a similar amount of debt over the next 2.5 years, but I recognize the challenges I will face in doing so. It must be a GREAT feeling to have made so much progress. Keep up the good work and advice.

  • Great story; you’re keeping me focused.

    I thought I’d share ours. Five years ago I was going to be laid-off for the second time in the same year and it wasn’t even July yet. To make things more challenging, we wanted my wife to quit work and stay at home and take care of our first child the next month; she couldn’t and that bothered me. I mentioned to her that I wanted to pay off all debt including our home in five years (~$140K), (we had 28 years left to pay on our mortgage when I said this) and that she would quit work in one year.

    Today, we can pay off the remaining $10K we owe on our home and we still have one income, along with two children (soon to be three) and a happy low stress home.

    Now we’re on the right side of compounding interest.

  • […] Clever Dude wrote When you put your mind to itÒ€¦ and shows us how he reduced his debt by $58,153 in 2 and a half years.  Way to go Clever […]

  • […] When You Put Your Mind to It: Clever Dude is not kidding. He shares his method for destroying $58,000 in debt. There’s hints galore for even the most world-weary debt gladiator. One of my favorites is “We Fix Things Ourselves.” It doesn’t take much — not that I’ve done it — to change the oil in your car, does it? Check it out! […]

  • […] When you put your mind to it… – A post about how we got out of debt, and the amazing amount we’ve paid off so far […]

  • I’m bummed. We’ve cut everything we can think of. I still have 24000+ in debt and we can barely pay it off in three years! Maybe three kids or the mortgage is in the way. We could not get down to $200/month in groceries. My boys would starve!

    Congrats to you.

Leave a Comment