My Biggest Money Obstacle

(We all get stuck in different places…)

The hardest part of getting out of debt, for me, was not stopping going out to eat or treating myself with manicures and pedicures. I used to think everyone had the same problem: you spend too much money – more than you make – but everyone has a different financial journey. Along my financial journey, I learned something about myself that honestly shocked me:

I’m a saver, not a spender.

As it turns out, some of us naturally like to save our money, but “savers,” as the financial industry likes to call us, can be in debt too. Savers can make huge money mistakes too and have difficulty overcoming large financial obstacles, such as debt.

When I started my financial journey, I did have to cut my spending. I thought cutting my spending would feel like going on a cauliflower diet sprinkled with beans and rice.

(…although many a-cheerio was consumed…)

On the contrary, it felt so easy to cut my spending that my friends questioned my sanity because I no longer paid for “necessities” like internet (“Guys – the library has internet”).

But cutting my spending wasn’t enough. In fact, it was so far from enough that I racked up an additional $14,000 in debt! Yikes. This happened because my focus wasn’t staying out of debt, it was getting out of debt. The difference between the two finally dawned on me when The Budget Mom put out an Instagram post where she asked viewers:

“What is more important? Getting out of debt or staying out of debt?”

“Staying out of debt!” (paraphrased)

Finally, I decided to take the advice from the hosts of the How to Money podcast. They suggested the order of operations:

  1. If your company offers a 401k match, take advantage of it (my company offers a 4% match which is standard)
  2. Build an emergency fund of about $2,500 (my emergency fund is $5,000 because that number makes me feel comfortable)
  3. Pay off high interest debt (anything above 7%)
  4. Save 3 to 6 months’ worth of living expenses
  5. Invest in one of your big money goals, such as saving for a home

Before implementing this advice, I had devoted all of my cash towards paying off debt. This turned out to be detrimental because, inevitably, something would come up – I had to replace carpet in my apartment, my dog needed a trip to the vet, something on the car broke – you get the idea. Life happens. When life happened for me, because I didn’t have an emergency fund, I went into debt. My credit card saved the day instead of using an emergency fund for – you guessed it – emergencies …because I didn’t have an emergency fund.

Once I came to my senses and created an emergency fund of $5,000 (because $5,000 made me feel safer than the recommended $2,500), whenever something came up, such as travel expenses for my grandmother’s funeral, I simply transferred the required amount to my checking account and used the funds I already had available.

This saved me from building additional debt. It even cured me from worrying incessantly about paying interest (I pay very little interest due to refinancing debt, but interest is still a source of anxiety). I still have money concerns, and I would still like to pay off my debt, but I truly learned the lesson that Mindy from Bigger Pockets Money podcast tries relentlessly to convey to listeners:

Personal finance is personal!

(You’re allowed to be unique – even when those around you can’t relate.)

Your journey will look different from everyone else’s journey, so don’t let setbacks stop you in your tracks. Learn to realize that you, as an individual, will have money obstacles unique to you.

Don’t give up!

Steps to Financial Freedom

Disclaimer: this post does contain affiliate links. (I’m actually excited about this because I just learned how to use affiliate links.)

For most of my life, I’ve been debt-free. But, for most of my life, I also didn’t know anything about money or personal finance – I didn’t even track my spending.

Two years ago, I went through a divorce. It wasn’t what most people call an “ugly divorce,” but it was ugly on my end. Although I had contributed to our debt, my ex-husband was a spender. Combining his spending habits with my tendency to ignore my spending habits created roughly $38,000 of debt.

Because I made significantly more money than my ex at the time, I ended up with our shared debt. That’s right – all of it. 100% of it.

It was terrifying. I’d never carried debt before – not more than a few hundred dollars here and there and my student loans which never totaled more than $15,000.

At this point, I had two choices: 1. continue to ignore my finances, or 2. face it and take control. If you’re thinking right now, “38,000 is not that much debt…,” you’re right. It’s not, so I want to encourage you not to feel overwhelmed by your debt. It is just a number, after all.

Kumiko Love/The Budget Mom paid off almost $80,000 of credit card debt in a single year! That’s twice the amount of my debt, and it’s not too far off from $100,000. Why am I saying this?

No debt is too large. You can get out of debt. Anyone can follow these proven steps to get out of debt, and many people have. So I’ll ask you the same question Mindy Kaling asks, “why not me?” … or rather, “why not you?”

Step 1. Track your spending

This is by far the hardest step! This first step challenges you to face your finances head on. That can be terrifying and, like many people, for many years, I chose to look the other way. However, please know that if you don’t control your money, it will control you.

Once you can look at your finances, trust me, it gets easier! Below is a simple example of a budget you can tailor to your own needs or simply see what it looks like to face your finances.

There are also a number of free budgets – check out The Budget Mom’s website: – you can use to track your spending.

Step 2. Pay minimum balances towards your debt while you build an emergency savings fund.

This step is also difficult because you might feel inspired or in a hurry to pay off your debt. You may be tempted to skip this step, but don’t! Speaking from my own personal experience, if you don’t have a savings account for emergency expenditures, you will likely take on more debt in the long run.

Here’s what happened to me a few times last year: I put all remaining cash (after I paid my bills) towards debt; then, something would happen. I would need money to repair my car or take one of my dogs to the vet, and because I didn’t leave additional cash in my savings account, I would have to use my credit card to pay for the unexpected expense!

If you take nothing else away from this post, I want you to take away this truth:

Personal finance exists to make your life better. Period. If the way you are living (putting all leftover money towards debt), is causing you stress (paying for unexpected expenditures with a high-interest credit card), change what you are doing!

The changes you implement in your life should be to make it better. It’s not selfish either. The more work you put towards bettering your life, the more you can do to help others. Sometimes just setting an example for someone else (a younger sibling still living at home, maybe) is enough.

Step 3. Put leftover money – after you’ve paid bills and saved some – towards your debt.

This is the point at which you want to decide which debt payoff strategy you want to use to pay off debt: the snowball or the avalanche method. Here is a link to one of my favorite podcasts, How to Money: that explains these two methods.

Personally, I prefer the avalanche method which focuses on paying off the highest interest debts first, but either method works.

Step 4. Capitalize on existing wealth.

This is my favorite step (you probably guessed that if you noticed the name of this blog). Capitalizing on your existing wealth can be any number of things, like using up some of the food in your pantry instead of eating out or turning a pair of old flip flops into a cute pair of slippers! Like I did:

Okay, no judgement, please. I do have dogs. But I still think these are cute. I won’t be mad if you think they’re hideous.

Capitalizing on your wealth might look like taking advantage of your employer’s 401k match. It might also look like asking your cousin who is a car mechanic to help you change your vehicle’s oil instead of paying someone else to do it.

Capitalizing on your wealth is simply taking some time to think about the ways in which you already have wealth (yes, your car mechanic cousin is something that adds to your wealth – be thankful for that cousin) and making the most of it. To me, it’s the ultimate act of thankfulness for what you already have in your life.

This is also the time to start investing!

Another great resource for building wealth and getting out of debt is Lisa Rowan’s book, Money Hacks. In her book, she shares so many nifty tricks to saving a little money here and there and making some additional income along the way.

Check out Lisa Rowan’s book Money Hacks:

Photo by Pixabay on

Step 5. Pursue your money goals.

As Mindy Jensen of Bigger Pockets Money Podcast likes to say, “personal finance is just that – it’s personal.” This means that whatever goals you have for your money are your own, and you’re allowed to make different choices than the Jones’s. For another great resource, check out Bigger Pockets CEO Scott Trench’s book Set for Life:

As The Budget Mom says, staying out of debt is harder than getting out of debt. Make sure the changes you make in your life are small enough to become habits. Once you build some sustainable habits, you can start adding more.

Again, you can get out of debt. You’re not alone, and there are so many resources available and communities of people who want to see you succeed.