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Posted on Feb 6, 2013 | 10 comments

Our Get Out of Debt Plan

Our Get Out of Debt Plan

Now that you know how we got into this mess in the first place, you might be wondering how we are planning to get out of debt. A very logical next thought. The short story is I created a get out of debt plan that worked best for us that would get us out of debt as quick as possible.

Free Budget Spreadsheet

I found a free monthly budget spreadsheet that I was able to easily add all of our income, bills, and debt into. I included how much we owed next to each debt to be able to easily track it and know where we were with our balances at all times. I put everything into the spreadsheet that either created funds going into or out of our budget. Besides all of our regular bills, I added all of our basic necessities like food and gas. I was also able to customize the spreadsheet based on our needs.

Find an Order to Pay Off Your Debt that Works

Once I had all of this information entered, I started playing around with the numbers. First, I put in all of our bills and the minimum payments we could make on our debts. Then I started adding more funds to the debt we would work towards paying off first. Once we have one debt paid in full, all of those funds will then go towards the next debt on the list to pay off.

Most of our debt is from credit cards. We also have debt from personal loans, as well as revolving accounts, like Bill Me Later. Some have no interest rates at all and others have ridiculously high ones. Some have little balances under $200 while others have  balances at $5000. Unfortunately, there are a lot more $5000 balances then there are $200 balances. Isn’t that the way it always is?

After looking at the balances, what kind of debt they were and who the debt was to, I ran my credit score through my Credit Karma account and printed up my yearly free credit reports through Annual Credit Report. I wanted to make sure I wasn’t missing anything and to know where my current credit score stood since it had dropped (all from new debt) just shy of 50 points (ouch!), 4 months prior and still hadn’t budged on going back up. I did the same for Drew so we were both starting off on the same foot.

Gather All Information Before Making Decisions on Your Debt

With all of this information I felt fully equipped to figure out which debts to pay off first. I thought about paying off the smallest debts first and working my way up to the bigger ones. I looked at which debts had the highest interest and thought about paying those debts off first. I considered which ones would increase my credit score the most.  I even ran our debt through the DOLP calculator.  For some reason, none of that seemed correct to me. None of these results and the order they were telling me to pay off my debt felt right to me. I was missing something.

Emotions Can Be Attached to Debt

While going through our debt I realized it was more than just how much we owed or interest rates. It was a lot more. There were actually emotions connected with each of those debts. Emotions that were affecting me in the order I wanted to pay our debts off.

I knew all of the debts we had, wrote them down on a list and then worked on that list for all of January. I switched the list around in different orders with different factors and paid attention to how it made me feel paying the debts off in different orders. By the end of January,  I finally came up with a plan that felt the best for paying off all seventeen of our debts.

We now know how much debt we owe and what order we want to pay it off. All we need to do from here on out is to follow our get out of debt plan. Easier said than done.

What did you do to develop your get out of debt plan?

About Kimmy Hayes

Kimmy Hayes is the founder and editor-in-chief of AfterGlobe; a site on becoming debt free and traveling the world as a married couple. In 2012, she planned and coordinated her own do-it-yourself destination wedding on the beautiful island of Maui while serving as a moderator for the on-line community, The Knot. She is passionate about traveling to experience new cultures, snorkeling the waters of the world and reading with her toes in the sand.


  1. Sounds like you have a really good plan in place… I think the hardest part is to figure out what order to pay debts off in. I can’t wait to hear about your progress, and any tips you have to share along the way!

    • I love your ambition and drive to get done what you need to go after your dreams! I appreciate the links you provided to help others with their debt. I will be following along to see your progress and wishing you and Drew the best during this journey!

      • Thanks, Lora. It did take some time to figure out what order to pay everything off in, but now that I’ve got it all figured out, I feel really good about the order.

        Thanks, Jenn. I will try to provide as much as possible to help others out, too.

  2. Hey Kimmy!
    Bravo on the site….even more bravo for working on making your life better; read: get out of nightmare debt.
    We were there at one point, and our rock-bottom was in 2006 when I realized through some interesting work circumstances years before, that our credit card debt was choking us to death. It may sound totally creepers, but one morning I woke up and heard a woman’s voice say, “$500 per paycheck”. I took this as a sign to save $500 per paycheck as a start, and did that for a while, and that quickly built up to $8000 in savings. For some reason this really kickstarted me to finally “get my head out of the sand” and address the real debt problem. I faced the music, calculated how much interest we had paid in 4 year’s time of bad credit card debt and high interest rates, and screamed into my pillow. And cried. And was mad. Mad as effing hell. Then I watched the documentary “Maxed Out” and saw how these companies *flourish* through suffering and mistakes. And got so effing mad that I made a radical plan, and presented it to my husband. I said, “This is radical. But we need to do it. I want to feel happy when I wake up in the morning again. We need to do whatever it takes, but we need to absolutely live on only your paycheck until this is all paid off.” We did, and it took just shy of 2 years. I told myself that my paycheck was just money, and that I essentially was working for “free”. In the end, it was a very valuable lesson, and one I’m happy that I learned in my 30′s…..not my 60′s or beyond. NEVER AGAIN!

    • Thanks, Wendy! Getting out of debt isn’t easy. It’s an uphill battle all of the way. If you stick with it, the pay off at the end is huge. I’m glad to hear you and your husband were able to get our from under your debt.

      I watched Maxed Out on your recommendation. It’s for sure disgusting how these companies take advantage of people’s pain and suffering to make a profit. Until Drew got laid off for almost 5 months while we were in the middle of paying for a wedding by ourselves, we had barely any credit card debt. How quickly that debt racked up once we had to turn to our credit cards to help us out during the time. Then it grew even bigger once you added on the interest and fees. It wasn’t before long, that all of the cards were maxed out and all we could afford to make were the minimum payments. Luckily, we were able to rework our budget and pick up some extra work to help us see the light at the end of the tunnel. I’m happy to say that we were able to pay another debt off in full yesterday and are a little over halfway to paying off the next debt.

      Wendy, thank you for sharing part of your story on how you got out of debt. I’d love to talk to you about it some more and feature you in an upcoming story on AfterGlobe.

  3. I commend you for devoting your blog to this topic because debt and money management seems to be a “dirty” topic in the blogosphere in that hardly anyone really talks about it in terms of long term financial planning and living a life free of financial stresses.

    Fortunately, I don’t have credit card debt anymore – just student loans (bummer). And my husband has very little debt. And then we have our mortgage and cars which I’m not too worried about. I listen to Dave Ramsey on the radio (do you listen?), and through his Financial Peace University teachings, he advises people to use a “debt snowball” method to pay off debts – starting with the smallest debt and working your way up. I used this method to pay off my credit cards, but we need to figure out how to tackle my student loans. I did the math, and if we just live off of my income and throw my husband’s at the debt, we can have the loans paid off in 5.5 years (yikes!). But living in L.A., it’s not a very realistic plan.

    So I will be reading your blog for inspiration because I think it rocks. Also, I’m going to add a link to your blog to my Bookmarked Blogs page! ;-)

    • Thanks, Dana and welcome to AfterGlobe. I figured the best way we could be accountable was by putting it on-line for the whole world to see. Plus, maybe we could help another get out of their own debt.That’s great about your credit card debt. Keep up the good work and you’ll get your other debt paid off, too.

  4. I think realizing what emotional connections you have to your debt is a great first step. Good for you for recognizing it. I never had a TON of debt (outside of my student loan, which I’ll be paying off FOREVER), but I had this pesky credit card debt that wouldn’t go away. I wouldn’t let it. Shawn never had debt. In fact, part of the reason we recently signed up for a rewards credit card was to get him as an authorized user to start building his credit.

    I don’t think there’s necessarily a “right” way to pay it off. It’s pretty individualized, as I’m sure you discovered. After I finally paid off the debt myself, I felt a new surge of energy. Saving money has empowered me in ways I never thought it could. Now that we have a goal to focus on that I REALLY care about, it makes me wonder what I was doing all those years with my money.
    Carmel recently posted…MY UNDERWATER FEARFUL ADVENTUREMy Profile

    • Thanks, Brittany. It’s not easy, but we are trying. Every time we get more paid off, it motivates us to keep working on it.
      Kimmy Hayes recently posted…A day in Kapaa KauaiMy Profile


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