How We Paid off $25k of Debt in One Year + a FREE Budgeting Printable!

How we paid off $25k in one year.png

Finances have been a source of stress in my life for the past 12 years. I have definitely lived in a mode of scarcity and not feeling like there's ever enough. That's not true - we've always had enough, but for some reason it's a story that plays strongly for me. As we have been married and acquired some debt, the stress has accumulated and multiplied.

This post is not a "debt is bad" post, although I DO hate debt, but it's more of a post to help anyone else out there who feels pretty suffocated by it or ashamed of it. We have a lot of debt, most of it is schooling from my husband's doctorate degree, but we also have a house and cars that were necessary purchases (both of our debt free cars died, and we didn't have the luxury of paying cash for new ones, so loans it was). The biggest debt and most embarassing debt is credit card debt! The one I am most ashamed to say. I don't even really know how it happened...because we aren't big spenders and we didn't do anything crazy. A lot of it was medical expenses for my ulcerative colitis and the rest was really just being mindless and not tracking our money.

The biggest lesson I have learned is that it is so important to be mindful and aware of finances. My husband and I tend to avoid situations that scare us or that we feel ashamed of, so it was easier to just stick our head in the sand and avoid facing our finances. Now, we are being more brave (I know that sounds dumb, but it feels brave to us) and we are facing our debt head on, and working hard to get out of it.

We have been actively working to pay off debt for a year now, and today I sat down and tallied up how much we have paid off. The amount surprised me!! You see, like I said at the beginning of this post, I've been working on getting out of a scarcity mindset. It's easy to me to feel like we suck at paying off debt and that even though over the past year that we've been more intentional, it hasn't been enough. I have felt ashamed because we still have debt, without giving myself the grace that this process will take TIME. Our efforts over the past year have been awesome, and have been enough. We have paid off over $25,000!!!! In one year.

In the journey to being free of the burden of debt, it is REALLY easy to feel overwhelmed with how much further there is to go. But when you look back, and tally up your work, it's easy to see that there has been progress! For me, having a plan makes me feel more in control which leads to a LOT less financial anxiety (although I'd be lying if I said my financial anxiety is's NOT...).


Now I want to share how we have been doing this. I have ignored finances forever because it just felt so hard. All the budgeting systems I have tried, failed. I felt like it was so hard to be good at it. Finally, I learned the easiest way from my friend Tiffany. It clicked for the first time ever!

Here's what I don't do:

  • I don't itemize our purchases. That gets so overwhelming to me.
  • I don't budget to zero.
  • I don't really have budgeting categories.

I guess you could say, the way I budget is very free-spirited. All the budgets I have come across do NOT work for my personality type at all and that left me feeling so bad about myself! Finally, I see that we CAN be good with our money - we just needed to find a way that would work for US. (I use me a lot in this post because I am the main one in our marriage who does the finances)

So here's how I break down each month and I even made a cute printable! I used to do just use 3x5 cards but I needed something to rejuvenate my debt paying off spirits so this worked well.

I'll start by saying that this system is probably not perfect, but I have tweaked it to make me feel good about myself, capable of money, and succeeding...instead of feeling like I suck. I am not great with numbers, so this makes it feel more attainable because I don't really have to itemize things. It's more like I have a chunk of money and just have to make sure not to spend all of it.

The main thing I do is each time we get paid, I divide our paycheck up into the following:

10% to charity/tithing
10% to savings
10% to debt
70% to living

That is the basic structure, however we are not following that pattern right now BECAUSE we wanted to get out of consumer debt as quickly as possible. Once we have paid consumer debt off and we only have things like student loans and mortgage left, we will return to the above pattern.

Here is our aggressive structure:

10% savings (once a $1,000 emergency fund is established, this 10% also goes to debt)
20% debt
70% living

It's pretty strict - it's essentially just living expenses and debt payments but we want that sh*t GONE therefore we are sacrificing for a time. Eventually we will be able to save more and be more charitable, which is the ultimate goal. With hopefully some traveling thrown in :)

Below you can see how I actually break it down (these are not our real numbers because I do want to keep that private!).

I want to explain the 70% living part. So I write down 70% of the paycheck and that right there is our living amount. However, I TRY really hard to be below that. That means foregoing activities, fancy vacations, lots of eating out, etc. In the example below, you can see that each paycheck, there is about $1,750 to live on. The GOAL is to live on less than $1,600. At the end of the month, if we can live on that amount, then there is an EXTRA $150 to put towards debt on top of that $250 we already did. Does that make sense?

Family Budget
Family Budget

It took me some time to tweak this system and get it right for my personality and our finances, but it's been awesome and like I said, through it, we have been able to pay off quite a large amount in the past year without necessarily making more money. We did get a good tax refund and put the whole thing towards debt, which felt REALLY good! We were mindlessly spending so much money and with just a little bit of focus (and a lot of living very frugally), we were able to chip away at our debt.

If you'd like to download your own paycheck planner, I made a blank one for you! Just click the image to download it for free.

Do you want this printable customized for you? If so, I am happy to do that for you! Here are the steps:

1. Fill out the form below with your preferred customizations.
2. Submit your $10 editing fee via Paypal ( or Venmo (@Kami-Larsen).
3. Within 24 hours, you'll receive an edited version with your personalized information.

Name *
Look at your bills for the month and figure out which paycheck they come out of. Include anything that is on auto-pay or is a recurring, set fee.
If so, please put the quote you want at the bottom of page #1 and page #2 here.
If not, please tell me what you'd like to put there instead.

When I am researching becoming debt free and trying to learn about how to better handle finances, I can quickly become down on myself when I see people who are in a much better and stable financial position. It seems out of reach and sometimes just feels very out of my control. In case you're like that, just know that we are still very much in the middle of this journey! We live paycheck to paycheck, we don't have a big nest egg in savings (wouldn't that be nice??), and we have a lot of debt. We have four kids, one main income, and my small side income that I am working on growing. We are just a normal family, trying to figure out life. So I hope you don't read this and feel bad about whatever financial state you happen to find yourself in. I want you to know if we can do this, you can too! 

Do you have any questions for me about this system? When I started to sit down and actually write, it made me so anxious! It was harder than I thought it would be to explain how I have been budgeting and paying off debt, even though it feels pretty easy. But, maybe that's just my anxiety speaking.

I really hope this helps someone else out there who is feeling super panicky about debt!

xo Kami

PS, if this helped you, would you pass it on? Send it to a friend, share it on Facebook, or pin it on Pinterest!