How we paid off $36,000 of Debt in 2013

While earning more is half of the equation to paying off debt, this highlights some of the areas where we are able to cut our expenses and pay off student loans even on a limited income.

At the end of 2013, we reached an exciting milestone in our debt repayment adventure.  We are now less than Six Figures Under.  We have less than $100k of debt!  We have paid off $40,000 of debt so far and $36,000 of it was in 2013.

Those who are regulars around here have a good idea of what we’ve done to get to this point.  Most posts on this blog have something to do with our frugal lifestyle that is helping us pay off debt in a hurry.

While earning more is half of the equation to paying off debt, I want to highlight some of the areas where we are able to cut our expenses and pay off student loans even on a limited income.

We keep our food budget low.

I feel very empowered by saving money in our food budget.  There are lots of ways that we cut kitchen costs.

  • We almost always cook from scratch.
  • We don’t eat meat often and when we do, we stretch it.
  • We grow lots of our own produce.
  • We preserve our own food by freezing, canning, and dehydrating.
  • We stock up on food by buying in bulk, on sale and in season.
  • We always pack lunches for work, school, when we’ll be out and about, and when we’re on car trips.
  • We grocery shop once a month.
  • We keep and rotate our food storage.
  • We eat out very rarely, usually when we have a gift card or there is a special promotion.
  • We occasionally have a “no-spend” month where we cook just from the pantry.

We have low housing costs.

Rent or mortgage is the highest monthly expense in most people’s budget.  We are blessed with an unconventional, yet wonderful living situation.  Our family of five is living in my in-laws’ basement which happens to be in the boonies.

While our space is nothing spectacular or beautiful, it has everything we need and the price is right.  We don’t pay any rent or utilities and the set-up has quite a few perks.  While this sort of living situation is not ideal and would not be feasible for many people, it is perfect for us right now.  It allows us to put much more toward our loans than we otherwise would be able to.

We spend very little on clothes and entertainment.

Although we have three kids who are growing like weeds, we spend very little to clothe them.  We employ creative ways to get kids clothes free or cheap.  We get mostly second-hand clothes, which is perfect for quickly growing little ones who are rough on clothes.  We also started cloth diapering with our third.  We spent $100 for everything we needed for cloth diapers.

Almost all of our entertainment is free.  We don’t even have cable (or a TV, for that matter) and our phones are just phones.  As a family, we enjoy lots of outdoor activities.  We also take advantage of community, school, and church activities that are free.  Any night when my husband and I are both home and the kids are in bed can become a date night.  We love working on projects, reading books, and playing games together.

We set a focused goal!

Of course setting a goal is only the first step.  Lots of hard work and sacrifice are required to make that goal amount to anything.  For us, setting a goal for paying off student loans meant we had to give up saving for a house.  We would not have made much progress on either goal if we had tried to do both at the same time.  I think that focusing all our enthusiasm and money on one big goal is the main reason we had so much success in our first year of debt repayment.  You can see the links to our monthly progress reports here.

What are your key areas for cutting costs in your budget to pay of debt or save for the future?

See how we did in 2014:

2014 spending fb


Linked up at Pin JunkieThrifty Thursday,  One Project at a Time, Project Inspired{d}, Weekend Wind Down




  1. CeCee says

    I love love love your tips. They are very “common sense”, but sometimes we forget. I think making (and remembering) your focused goal is the most important thing. Its easy to forget your a running a marathon when you get distracted by a treat along the way. Sometimes you have to say know to be able to say yes later. This was hard for me at first, and I actually lost a few “friends” because of it, but if people don’t understand that sometimes you don’t have the money. Then they must have money issues!

    Unfortunately we have higher housing costs, but that was a decision we made that will pay off for us in the end-its complicated

    We also do a “No-spend” month on groceries. Actually we are doing it this month due to: the paying off of a bill, and some small medical bills coming up. We call it a pantry challenge. Some times it is hard. Some times it is fun. I get a lot of moral support from the website when I do it. She is the pantry challenge queen!

    • says

      Thanks CeCee! They are pretty common sense. It’s no secret that anything you spend money on could be something you save money on.

      That’s awesome that you’re doing a pantry challenge right now! I’ll definitely check out good cheap eats!

  2. says

    Congratulations on such a successful goal. We too suffer from too much debt and are working on cutting costs and paying down our debt. Grocery shopping once a month seems like something I should strive for in our household. Right now, I create a list, but go once a week. I wonder how to stretch it into once a month. Will give it some thought. Thanks for posting. Have a blessed day.

    • says

      Thanks for stopping by Vicki. We live in the boonies, so once-a-month shopping also saves big on gas. It forces us to eat from our pantry and to really plan ahead. It saves on impulse buys and makes controlling the grocery spending much easier. It may no be for everyone, but it works for us.

  3. says

    Hi there, I’m stopping by from SITS! Loving your site. I’m also on a quest to get out of debt!! Your tips are great. Food is by far one of our largest expenses and I have such a hard time cooking from scratch and making the dollars stretch. Awesome job on your debt payoff!

    • says

      Hi Angella! Thanks for visiting. I have found that keeping the food budget reined in really helps in paying off debt. Even though it’s not always convenient, cooking from scratch helps keep our goal at the forefront of my mind and it’s also healthier!

  4. says

    Thank you for sharing! We have been working hard to build up our savings account, and these tips would definitely help for that, too. Thank you for linking up with the Weekend Block Party, I hope you’ll join us again this week!

    • says

      Definitely! Cutting costs frees up money to build savings. Once we’re done with this debt thing, these habits will be so ingrained that saving should be easy, right?!

  5. Belinda says

    Hi Stephanie!

    I discovered your blog, via ‘Not Your Mainstream Mama’ a week or so ago. I’ve really been enjoying reading your posts and find your debt-busting efforts to be really inspiring.

    We have some debt that we are currently working on, so it’s always great to read blogs written by like-minded people, who are employing similar strategies to resolve their debt .

    Good luck with it all, and thanks for the informative and relevant posts!


    • says

      Hi Belinda, I’m glad you found me! I think being around (even virtually around) like-minded people helps to encourage and motivate me too! Good luck to you as well! We can do this!

  6. says

    What an amazing milestone to reach in paying off your debt. Congratulations! I’m looking forward to reading more of your posts on how you all are saving money and paying off your debt. We have a bit to pay off ourselves so we can get back on track and buy a home. Thank you for sharing your journey with us!
    We’re in the same SITStah tribe. It’s so nice to meet you and find your great blog!

    • says

      Thanks for stopping by Crystal! We are looking forward to getting a home eventually too, which is another reason we are in a hurry to get done with all this debt!

  7. Sally Webster says

    This is great, but I am very confused. Your welcome box says that you have an income of less than $40,000/year. How can you pay off $36,000 in debt in a year when you make less than $40,000/year income. Do you really mean that your family of 5 lived an entire year on less than $4,000?!? Although I do see that you live with your in-laws so I’m sure that helps if you aren’t having to pay traditional housing costs.

    • says

      Hi Sally, that is a valid concern. The numbers don’t seem to match up because we did have some money in the bank and in CDs when we started. It was earmarked for other things, but we decided to devote it all to our loans. In the comments on our story (the post you get to when you click on my welcome box), I answer extensively on where all the money came from. Hopefully that helps :)

  8. says

    Hi there! Your post really caught my eye at our Weekend Wind-Down party! I just had to read it! I love your tips for cutting back in the kitchen…especially the one about a “no-spend month” and just using what you have. I guess Hubby and I sorta did that this month, as we are also trying to cut back and be more frugal! Love this idea! i’m totally going full with it once my stock pile is a bit larger! Thanks for linking up with us and you are definitely going to be featured at our next party Friday night! Have a great week!

  9. Jasmine says

    Great article! I’m an advocate for financial health. I have saved a ton in my emergency savings. I noticed I can’t do both (save) and pay off debt. So I am going to use part of my emergency savings for my debt. This way I can eliminate and start fresh with no debt. I plan to have a no buy month soon and continue on my road to being debt free.


  10. Rose says

    We only have about $19000 in debt, but it feels like six figures. I hope I can get some good ideas from reading your posts! Thanks in advance!

  11. says

    What a blessing that you can live in your in-laws basement!! Do you know how much money we spend on just living somewhere? If we could apply that every month to SL debt it would be gone so much quicker! Ha ha ha. Sacrifice for sure, but I’m glad it seems to working for you all.


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