I love sharing stories of real people who are taking control of their money, getting out of debt, and on a journey to financial freedom.

So far on the blog we have heard from Ron and Thu Noble and Alex and Megan Barker who have shared how they have paid off their debt.

Today I am pleased to bring you Amy Nickson’s story.

Amy is a single young woman living in Atlanta, Georgia. She openly shares with us the habits and influences that led her to enormous financial stress during one of the saddest periods in her life.

She reveals how she took control to change her financial future and is using her experiences to help others do the same.

Here is the interview:

ME: Thank you so much for agreeing to share your story with Our Debt Free Family! Please tell us a little about yourself so we can get to know you.

Amy: I am Amy Nickson. I am 28-years-old and live in Atlanta, Georgia. I lost my adoring mom two years back and broke up with my ex-boyfriend last year.

ME: I am so sorry to hear that. Did that play a part in why you decided to focus on becoming debt free?

Amy: It was a really hard time for me three years ago. My mom was seriously ill due to liver damage. I wanted to get a better job but didn’t have the opportunity due to my low credit score. I had $88,000 in outstanding debt during that time.

Being absolutely helpless and grieving, I consulted one of my friends, John, who is a personal finance expert. He advised me first to calm down. Then he said, “Megan’s (my mom) medical issues can be resolved by her medical insurance. The rest you can manage from her savings. Your first concern should be your debt.” I was at a point where if I failed to pay my debts, I would become bankrupt.

ME: How much debt did you pay off, and how long did it take you?

Amy: Well, I have paid off $51,000 in the last three years and six months. Now I just have my student loan debt left, which I couldn’t pay off during that time due to some financial hardship.

ME: What kind of debt did you pay off?

Amy: I had four credit cards, a car loan, and a student loan. My biggest blunder was buying a brand new Volkswagen Beetle during my college days.

ME: What did you do for work while you were paying off your debt?

Amy: During that time I had joined a small non-profit company as an assistant account manager. My salary was fair.

My friend convinced me to leave my job to start my own business. I have a small financial consultancy now. It is still growing, and there is lots of work to do.

I love writing so I started blogging. I used to write on a variety of topics, but now I specialize in finance. I am a freelancer and a contributor for the Oak View Law Group. I earn a big part of my bread from there. Recently, I started my own blog as well to establish my expertise in the financial field.

ME: What was your annual income during this time?

Amy: It was approximately $57,000 during my struggling phase. I earned this amount from my job, but my boyfriend at the time was too casual about his career. He was a fickle-minded guy and loved to switch jobs frequently. For this reason, I used to support him.

During that time I started using my cards on a regular basis. We spent lots of money on Starbucks, and the result was a complete financial mess.

ME: I see. Did you do anything to increase your income during that time?

Amy: Well, my mom had medical insurance so her needs were taken care of. I sold my car to pay off the huge car loan. I rented my garage out to a friend to earn some extra money. I did what I had to do.

ME: What sacrifices did you make when you were getting out of debt?

Amy: Once I sold my car, I began using public transit to travel. I put an end to the habit of spending money on Starbucks with my boyfriend. I used to go to movie theaters every weekend. But I felt like these were nothing but bad financial habits that were sucking a lot of my money and leaving me with a long list of credit card bills and nothing else.

ME: So you became more intentional with your spending. What are your top money-saving tips?

Amy: Budgeting, budgeting, and more budgeting.

My mom always did it. And my friend John told me about the benefits of budgeting and taught me how to do it.

Take a piece of paper and note down all of the expenses that you incur on a regular basis. Cut down all your extra expenses that are a total waste of money. This helps you to save some money and make bigger payments to your creditors.

ME: I love that advice! What other advice would you give to someone considering starting their own debt free journey?

Amy: Adopt frugal living habits and saving habits. These are the most effective weapons to kill any debt troubles. You need to be determined and have patience to come back from the financial strain as well.

[bctt tweet=”You need to be determined and have patience to come back from the financial strain. @AmyNickson86″]

I would like to share some frugal tips with those who are facing a similar situation:

• One of the best ways to save is to cut down on your extra expenditures. You need to differentiate between luxuries and your daily needs.

• I made a list of all those items that I would need to buy every week such as groceries and consumer goods. Make sure that you keep your shopping list in your handbag whenever you go to the store. This will help to ensure that you don’t end up buying more things than necessary.

• I believe that excessive use of credit cards is one of the main reasons that people get into trouble with debt. I am no longer a crazy fan of plastics. I have decided to stop using my credit cards altogether, apart from emergency situations.

• Generally, I use cash for little shopping. This actually helps to keep track of your single expenditures. And you can trim extra expenses accordingly.

• I saved a lot of money after disconnecting my land-line in my house! If you are paying for the Internet, then don’t waste money on other prepaid text messaging packages or talk-time offers. Simply download apps to socialize or to stay connected with friends and family.

• I take care when it comes to using my electrical appliances and make sure to keep them turned off when they are not in use. 🙂

• I made it a point to pack a brown bag lunch for myself to take to work every day. My cost of eating out was reduced to zero. I gave up the habit of eating dinner in fancy restaurants on the weekends, as well. When I was racking up my debt, there were so many times that I would pay the restaurant bill by credit card. Alas! This was another big mistake.

• Get help from a professional settlement company if you need it. As per the advice of my friend, I opted for debt settlement. The debt settlement company that I selected actually negotiated with the creditors and collection agencies to reduce my outstanding debts by about 25%.

I admit that it was not easy for me to adjust to a frugal lifestyle. It was especially hard for me to give up buying clothes and accessories that I used to splurge on. But I am glad that by adopting these good habits I have been able to get past my debt troubles and have started living a normal life again.

ME: Thank you for those great insights! Have you made any big purchases with cash since starting your debt free journey?

Amy: Luckily, I already have my house that my mom bought several years ago. Thanks to God Almighty I was able to keep my mom’s hard-earned shelter.

While I haven’t made any big purchases, I am trying to save money to buy a low-maintenance car in the future.

Also, I have a plan to start my postgraduate studies. This will help me to improve my expertise in the area of finance. I will use my degree to facilitate my career through blogging and take up some freelancing work. I think it will take 2-3 years.

In the mean time, I will plan for short and inexpensive trips for refreshment. No big trips at this time.

ME: Thank you for sharing your story with us, Amy! What is the best part about becoming debt free?

Amy: Peace and freedom. I can now sleep peacefully without worrying about creditors’ threatening calls.

And more importantly my credit score has improved since I started dissolving my financial obligations. Thus, I will have more opportunities to apply for new or better jobs or apply for a loan.

Currently, I have only one federal student loan which I am thinking I will pay off with the help of a repayment program. My main goal is to build a solid career so that I can save more money and become rich. 🙂

I want to thank Amy for sharing her story and so many great money-saving tips with our readers. I am inspired by how she took action to improve her situation during one of the toughest periods a person will ever go through — losing a parent.

What About You?

Participate in the conversation.  What parts of Amy’s story did you find most inspiring? What tips from Amy can you apply to your life? Share in the comments below.

Asia, Latin America, Europe – these are just some of the places Kach and Jon have traveled while living free from debt!

Today, I’m honored to share the story of Kach Medina Umandap and Jonathan Howe, the top monkeys at Two Monkeys Travel Group – Community Travel Blog! [Read more…]

One of the first things you should do before starting any financial journey is to get your spouse on board with change.

Whether your goals are to pay off all of your debt or simply to ensure that you have enough saved up for a comfortable retirement, it is imperative that your objectives are aligned with those of your spouse. With financial issues being the number one cause of divorce, it is vital that you and your spouse work together to build a solid financial future.

Sometimes, though, this can be easier said than done.

When I saw the financial light (so-to-speak) and began to imagine the freedom we would feel if my husband Mike and I paid off all of our debt, including our mortgage, all it took to get him on board was a simple conversation.

When he got home from work that day, I nervously explained my revelation and my excitement about paying off all of our debt. Then I waited for Mike to reply.

To my delight, Mike smiled and said, “Let’s do it!”

From there, we worked together to develop our plan of action and started dreaming together about what being completely debt free in a few years would allow for our future.

Unfortunately, not everyone will have such a smooth experience.

If you are ready to take control of your money, pay off your debt, and work toward true financial freedom but are worried that your spouse may be resistant, I have come up with some strategies that you can try to get him or her to jump onto the financial freedom bandwagon.

Please understand that the intention here is not about manipulating your spouse into agreeing with you. You simply want what is best for your future and the future of your family. You recognize that having a plan for your money can provide security, freedom, and opportunities; while living with a lack of intention regarding your finances may lead to a life of regret, uncertainty, and unnecessary stress.

Implement the pieces that you think will work for your situation, think positively, pray for guidance, and be prepared that it may take several conversations before your spouse fully commits.

Starting the Conversation

Once you have decided that a conversation about your financial future with your spouse is necessary, find a time when you can talk without any distractions. This may be after the kids have gone to bed in the evening or before they wake up on a Saturday morning.

Let your spouse know that you have something exciting you would like to get his or her input on. Explain that it is important and that you would appreciate their full attention.

If you lead with your excitement your spouse may be more open-minded to hearing you out.

Start by establishing some common ground for your conversation. Focus on the dreams that you and your spouse share and explain how taking control of your money can help to make those dreams a reality.

Avoid beginning the conversation with details that your spouse may be opposed to such as getting on a budget and tracking your spending. Instead, focus on the bigger picture and the direction of your financial future.

Focus on the Benefits

Explain why making a change is important to you. Focus on the benefits that being more intentional with your money will provide.

Discuss why taking this step and working together on a healthy financial plan is crucial and what it will do for your future. Share about the added security you will feel when you have a plan that will get you to your goals.

You may want to share examples of other couples who have paid off their debt and are working toward true financial freedom.

If your spouse has traditionally been the person in charge of handling your finances, let him or her know that you would like to be more involved.

Without criticizing your spouse or indicating blame, indicate how your current financial state has you feeling concerned for your future. This can be tricky so choose your words carefully or omit this part if you feel that your spouse may not react favorably.

Ask Your Spouse for Input

Ask how your spouse feels about having a financial plan and working together to create one.

This is where you stop and listen. Fight the urge to interrupt if his or her response is not the reply you were hoping for.

If he or she is on board and shares your excitement, then begin by getting clear on your dreams together and writing goals that can lead to achieving those dreams. Next, develop your plan for success.

What to Do If Your Spouse is Resistant

If your spouse is resistant, however, then it may be best to end the conversation. It is important to respect your spouse’s opinions and avoid turning the conversation into an argument.

If you feel your spouse is open to discussing further, then ask why he or she is hesitant. Listen and try to understand where your spouse is coming from. Put yourself in his or her shoes and appreciate how they feel.

Try to offer some ideas in response to your spouse’s objections in a way that does not come off as argumentative. Position your responses as ways to help you both to achieve your objectives and work together on a solution.

Recognize that your spouse may not be able to articulate why he feels the way he feels. If your spouse is not able to explain why he or she is resistant or refuses to discuss further, then switch the conversation to a more favorable topic to your spouse.

Understand Why Your Spouse Might be Hesitant

Reflect on your spouse’s childhood and how his or her parents handled money. Examine your spouse’s relationship with money and try to understand what may be holding him back from being proactive about your financial plan.

It may just be that your spouse needs some time to process the idea of creating a financial plan or changing the direction of your financial future.

He may feel overwhelmed by the idea of budgeting, tracking spending, paying off debt, and saving money.

He may not know the first thing about budgeting or why it is necessary.

He may not think he has enough time to devote to creating and implementing a financial plan.

He may not realize that having a plan can make him feel more in control of his money. Instead, he may feel like a plan will control him.

Whatever the situation may be, being sensitive to your spouse’s feelings about money will help you decide how best to proceed.

Lead by Example

While it is best to work together with your spouse on your financial plan, that may not always be possible.

Rather than giving up on the idea of being more intentional with your money, think of some simple ways that you can lead by example. It may be that once your spouse sees you making some changes that impact the family in a positive way, he may decide to jump on board and find out how he can help.

Here are some ideas:

• If you are the one who generally decides what to make for dinner, then maybe you can start meal planning as a way to save money on groceries and try to adhere to a food budget.

• Perhaps you can look at your expenses and try to negotiate a cheaper rate for Internet.

• Or maybe you can start limiting the number of lattes you purchase during the week so that you can make an extra payment toward your credit card.

• You may want to go through your closet and pull out some clothes you no longer wear and take them to a consignment shop to bring in some extra money.

Once your spouse sees you making an effort to take control of your finances and understands how important making a change is to you, he may be more willing to work with you to develop a plan.

It is important to remain patient, maintain a positive outlook, and have faith that your spouse will eventually see the financial light.

What About You?

Participate in the conversation. What advice would you give to someone who is trying to get their spouse on board? What worked for you when you had a similar conversation with your spouse? Share in the comments below.

If you were 100% debt free one year from now, what doors would that open up for you?

But what about if you were only 50% debt free?

That would still be pretty incredible!

Now’s the time to make this year the year that you take control of your money once and for all so that you can say “no” to debt and start saying “yes” to the life of your dreams.

I’m not talking about a resolution.

You know, those declarations where only 8% of people actually achieve success.

I’m talking about a new way of life.

A life where debt is no longer tolerated.

A life where you’re in control of your financial future and money is no longer a stressful subject.

The future is bright.

No matter how much debt you have now, and no matter how much (or how little) money you make, you CAN make progress to get out of debt.

To get started on the right foot so you can successfully tackle your debt, follow these steps:

Take a look back at the past year. If you’ve been keeping a budget or tracking your spending (and even if you haven’t), review how the past 12 months went. This is a good time to do an updated Net Worth Assessment.

How much debt did you pay off? Even if you didn’t pay much more than the minimum payments each month, if you have less debt at the end of the year than you did at the beginning, stand up and cheer! Be proud of yourself for not going deeper into debt!On the other hand, if you have more debt than you started the year off with, make a conscious effort to figure out why your debt balance increased.Were you not paying attention and got deeper into debt without realizing it, or was there a situation (or two) that surprised you that you don’t expect to come up again? Life happens so don’t be too hard on yourself. You really want to look at the year through an objective lens to figure out what lessons can be learned and how to avoid those situations in the future, if at all possible.

Remember, no judging, just adjusting where necessary. [bctt tweet=”No judging, just adjusting where necessary.”]

Did your assets (i.e. retirement account balances, savings account balances, home value, etc.) grow? The idea is that over time, we want our asset values to increase and our debt balances to decrease. This will improve our net worth and our financial health.

How much did you spend on average each month on groceries? Eating out? Utilities? Gas? Clothing? Etc? To figure this out for our household, I created a “Summary” tab in my budget spreadsheet that totals our spending in each category. It then divides the total by 12 so that I can easily see the monthly average we spent for the year. (You can easily do this with a pen, paper, and a calculator, though.) I like to analyze the averages for all categories, but you can start by reviewing the main categories that I listed above and any other pertinent categories for your household.

Determine what went well and areas that need improvement. What were the areas where you consistently went over budget? What areas did you consistently come in under budget? Begin to assess if you’ll need to adjust your budgeted amounts for these categories going forward. For example, as of December 28th, we averaged $601.82 for groceries per month, but we budgeted only $500 each month.Does this mean that we should increase our monthly grocery budget to $600 each month next year? Well, we still feel like keeping our grocery budget under $500 is a reasonable goal.

And here’s why:

I also reviewed the last six months (July through December) and found that on average we spent $464.55 per month! While there were a couple of months where we went over budget, we had four months in the last six months where we came in well under budget!

It might be worth doing some deeper analysis of your spending to determine if you should adjust your budgeted amounts up or down (or keep them the same).

Celebrate your achievements! For some, this will  be easy after going through the steps above. Others might have to work a little harder on this one. Even if you are having a tough year financially, come up with at least three things that are going well It could be as simple as lowering your cell phone bill or committing to buying things only when they’re on sale. I’ll bet that if you look hard enough, you can see that you made some positive changes for your financial future.

Use that momentum of feeling accomplished to fuel you to create your plan for the next year.

Determine new budget amounts for gifts, clothes, food, saving, etc. Create your Gifts Budget and determine your Budget Busters.Then break down these amounts into monthly amounts that you can include in your monthly budget. Take a look at your updated Net Worth Assessment and update your Debt Snowball.

Write down your SMART goals for 2016.How much debt do you want to pay off in the next 12 months?You can determine this by deciding how many debts you want to pay off this year (e.g. 3 credit cards), or you can come up with a percentage of debt you want to get rid of (e.g. 50% of my non-mortgage debt), or a nice round number (e.g. $20,000).However you come up with your amount, make sure you write it down (including the amount down to the penny) and add a deadline (e.g. December 31).And don’t forget to include WHY reaching this goal is important to you! Having a strong reason why is vital to success.Or if getting out of debt isn’t your goal, how much money do you want to save in 2016?

Break them down into shorter-term goals, e.g. quarterly, monthly, pay period. Let’s say you want to pay off $20,000 of debt. I don’t know about you, but that sounds like a huge amount to me.But I also think it is completely doable.Split up the amount so you know how much you need to pay off each quarter, month, or pay period to meet your goal.So $20,000 in one year is $5,000 each quarter or $1,666.67 per month.Maybe that amount fits nicely in your budget, and you’ll be off and running knowing you can easily meet your goal.But what if it doesn’t?

When you create your goals, push yourself a little outside your comfort zone. Shoot for a little more than what you think you can actually accomplish.

In 2015, our financial goals totaled $41,469.33!

That breaks down to $3,455.78 per month! And that amount did NOT fit nicely into our budget by any means.

But we knew we had to make great strides in 2015 if we want to be completely debt free (mortgage and everything) by 2021. And we definitely do!

So we pushed forward, got creative, and if you’ve been following my blog for a while, you know that, we were able to surpass those goals!

Even if you can’t see at all how you’re going to achieve your goal, I still want it to make you uncomfortable. Great things happen when we get outside our comfort zones!

And you may just surprise yourself!

Create your January budget.Determine how you’ll be budgeting — pen and paper, an app like Personal Capital, or a spreadsheet.  I made it easy for you to get started with my Monthly Budget template. There’s a separate tab for each month, and it will do all of the math for you. Enter your expected income for the month of January.Enter your monthly budgeted amounts.

Use the analysis from your 12 months of spending from Step 1 and the monthly amounts you came up with from your Gifts Budget and Budget Busters exercises from Step 2.

Next, fill in your other expected budgeted amounts, and then determine how much extra you’ll be paying toward your smallest debt on your debt snowball (or how much you’ll be saving each month if that’s your goal).

Set up your daily and/or weekly habits to keep yourself on track. How many times each week will you update your budget? (I like to do it twice a week — usually Mondays and Fridays.)Schedule when you’ll update your budget on your calendar. If you see it as an appointment with yourself, you’ll be more likely to do it. If you don’t have an accountability partner, find one.

Determine what you will do when you get off track — because you will! We’ve been on our debt freedom plan for more than two years now, and we’ve never had a perfect month! But we have paid off more than $120,000 of debt on a single, middle-class income. Our progress has come in waves, and we seem to get off track at least a couple of times each year. But each time it happens, we remember why we’re working so hard to get out of debt, re-commit to our goal, and then resume our focus on keeping our spending low and boosting our income so that we can pay off more debt.I’ll be sharing more next week on how to get back on track when you get off course so stay tuned!

Plan how you’ll celebrate when you reach each shorter-term goal from Step 2. For each of your shorter-term goals come up with a way that you’ll reward yourself when you reach each milestone. Maybe you and your partner will share a bottle of wine and indulge in a fancy dessert. Maybe you’ll sign up for that half-marathon you want to participate in next summer. Maybe you’ll get yourself a long-awaited manicure and pedicure. (Maybe these are all ways I plan to reward myself when we meet our goals. 🙂 Just sayin’.) Shooting for the shorter-term goals may be incentive enough to achieve them, but sometimes we need a little extra push to stay on track.

You can tackle your debts!

It will take work, but with a little-advanced preparation, you’ll increase your chances of achieving your goals.

Now I’d love to hear about you!

What are your financial goals? How are you setting yourself up for success? Please share in the comments below.

Bankruptcy Rules Might Go Up for Review

According to the G.19 Consumer Credit Report recently released by the Federal Reserve, America’s total student loan debt has topped $1.5 billion – and we are having trouble paying off that debt. At of the end of 2017, a whopping 11 percent of student loans were either ninety days delinquent or in default.
[Read more…]

When I introduced myself on Our Debt Free Family blog I wrote that my husband and I paid for our wedding on our own. With our 6 year anniversary coming up I wanted to share a bit more about how we did that.

Why did we pay for our wedding? [Read more…]

To round out Mental Health Awareness month, I thought I’d talk about one of my biggest challenges (mentally, financially, etc.). Not unlike many people, I have a really hard time asking for help, even when it has been previously offered or received. At times, this has cost me a lot. It has cost me relationships, friendships, and plenty of money. There have been moments I didn’t ask for help and took out a loan instead. Why?

I’d like to say it is pride getting the best of me, but there are probably a lot of reasons I don’t ask for help. One of the biggest is that I’m certain other people will let me down or I’ll let them down in some way. If I do it alone, no one can be disappointed with me but me. There are some other reasons you might have trouble asking for help.

Why You Feel Like You Have To Do It Alone

First, people who are overgivers often have a difficult time asking for help. Because they focus on giving so often, they don’t always know how to accept help. You may also be codependent, which has been a large part of my problem. A lot of my own self worth has been tied up with what people think of me. So, I spend time taking care of other people instead of tending to my own needs. People ask me for help, I say yes. When it comes time for me to ask for help, on the other hand, it is nearly impossible.

It is also possible that you are trapped in a victim mindset. Maybe you’ve had bad luck in the past, it doesn’t always have to be that way. Don’t stay in the mindset that you are alone and have to handle everything alone. Counterdependency is also problem. It is the opposite of codependency. These people often say things like “I don’t need anyone or I can do it myself.” At times, this may make you seem strong and stable, but you often feel lonely and have no real connections in the world.

Trust, self-esteem, and intimacy issues have all contributed to my own personal difficulty with asking for help. Some people truly believe they need to suffer and others are beaten down by their inner critic. Whatever the case may be, it is okay to ask for help. In fact, you should do it more often.

You Should Ask For Help More Often, Here’s Why…

Generally speaking, people are reluctant to offer unasked help. They don’t want to potentially offend you by offering and it can create an awkward situation. So, if you truly need help, you won’t get it unless you ask. You won’t come off as needy and it won’t harm your relationship. In fact, asking for help has actually been shown to strengthen relationships.

So, next time you’re down on your luck, remember that you can ask for help. Give yourself some grace! I’ll try to remember that too.

Read More

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• Financial Lessons That I Hope to Teach My Daughter

As parents, it’s so important to teach our kids about money, so when they leave the nest we can feel confident that they won’t learn many money mistakes the hard way like [Read more…]