3 Debt Payoff Mistakes I Wish I Could Redo (and How You Can Avoid Them!) | 78

0:00 A debt rebel. So when we were drowning in debt, I made so many mistakes. And if I could hop in a time machine and go back, there are three things that I would change immediately. Things that would have saved us a ton of stress, time, and definitely some money. So if you're on your own debt free journey, these lessons will help you avoid the mistakes that I made and speed up the process for you. Welcome to the Debt Rebel Podcast where we discuss the insurance and outs of personal finance for families so you can eliminate the burden of debt, create financial margins, and learn a new way to interact with your money.

0:39 I'm your host, Jules the Budget Nerd, and I have been in your shoes. My husband and I have paid off over $107,000 in consumer debt until we finally threw in the towel and decided it wasn't for us. Throughout our journey, we learned another way to do life without debt, and that's my hope for you. You can learn more about our story and see full shown what's on my website, julesthebudgetnerd.com. That's JEWLZ, the budget nerd.com. Now let's dive into today's episode. All right, so if you are newer to the show and haven't heard my story, you can listen to episode #1 it is our our story of our, our debt elimination journey.

1:20 But I have a degree in economics. My husband and I got into over $107,000 in consumer debt. So I know a lot about this process and this journey. It is not just about had knowledge. And so it took us six years to get out of that, that debt load. And so I know that if we had not gone through some of these things, it would have it would have speed up our process. And so that's what I want to share with you today is I don't want you to make these same missteps that we did. And I want you to know that you don't need a perfect plan.

1:54 You just need the right focus at the right time. And so for US, one of the things that was super, super important is making sure that you build that emergency fund first, so not jumping straight into the debt payoff without having a buffer. And so for us, part of our story is we bought a house and couldn't make the first mortgage payment. And so we had no savings set aside to help us with that. And if you set yourself up in that way, every little thing, every little car repair, every little medical bill, maybe it's a house, you know, a house repair, every little thing starts to just snowball in the wrong direction.

2:36 And so for us, it was just, we're constantly putting stuff on credit cards. And I remember putting the power bill on a credit card because we didn't have that little bit of surplus so that we could focus on our debt repayment. But we could take care of the little things as they came. Even if they like to teach the alliance members is $1000 is a great place to start with your emergency fund. So it's going to buy you a little bit of breathing room. So hear me say, do not skip this step. It can feel like you're like, let's just get into it.

3:08 Let's just get into eliminating that debt. But when you have that $1000 buffer, it's going to help you feel a little bit more in control and at peace with the journey that you're on. So do not skip this step. Rebel. All right. And the next one is budgeting every dollar and including fun money in it. So I like to consider myself kind of an extremist, but not like an extremist in like I'm going to go bungee jumping and but like in a like, OK, I'm going to be, I'm an all or nothing kind of person. So trying to get out of debt, I'm like, we're going all in.

3:43 And so we created a budget that wasn't super realistic for us because we weren't going to do all of these things that brought us joy. And that's why I teach the budgeting a little bit differently than I did it because of this, this principle right here when we are setting ourselves up for burnout and not allowing any kind of fun or joy in our life, even though we're kind of going through a hard season when it comes to our money, it's really important to find the joy and find the fun in the process because we will burn ourselves out.

4:18 We're going to rebel against our own rules and say, I'm not doing this. So to be successful, you want to have a plan for your money. So that's budgeting every dollar that comes into your household, but making sure you're including some fun money. Now it doesn't have to be like thousands of dollars, but give yourself a little bit of money so that you can spend without guilt, but being consistent with your overall spending so that you can eliminate your debt faster and get to that that day. That is such a joyful day when you can say, I don't owe anybody anything.

4:51 So making sure that you include some fun money in your budget and call it whatever you want. I have clients that call it all kinds of things. So if you have a have a fun special name for it, it's the money that no one can tell you like judge you for it or so like for my husband and I, we each have our own. So he has his, I cannot tell him what to do with it and he can't tell me what to do with mine or judge me for my choices. And then the rest of our money, we budget that together and we say, hey, this is where we're going.

5:22 But that fun money is whatever brings us fun, joy, whatever. And then the last one is getting support and accountability. So I didn't even know when we were going through this process that financial coaches existed. Little did I know that this is where I would be and this is what I would be doing and I absolutely love it. But The thing is, we were, my husband and I, we were doing our debt elimination journey alone. So yes, we had each other, but we both brought some stuff to the table that was at one point, We were not on the same page.

5:55 And so it took a lot of patience for us to both get to that spot. But I know if we had some outside accountability and some outside help in that process and support that we would have got to our debt free date faster. And so one big mistake is just doing it alone and not having a community, someone a cheer you on because the world's going to say you're crazy for trying to pay off all of your debt. But also it's not it's not an easy process. It is absolutely worthwhile, but that sometimes we can get into those shame spirals where we were like, you know what, we got off track.

6:29 And so when you have that support, you can have someone remind you to say, hey, you know what? It's about progress, not perfection. So let's, you know, pick yourself up and let's go for it and let's keep moving forward because we can't change the past. All we can do is change today and our future based on how we spend our money. That's why I've created the Alliance coaching program. It's community coaching where we get together a few times a month to plan out our spending. We do some training and then you have access to an online portal that has on demand trainings, has a message board.

7:05 So when stuff comes up and you're like, I don't know what to do with this, we have weekly challenges in there. It's so that you can work on your finances in 15 minute increments. And I'm not talking about 1515 minute increments like all day long. I'm saying like, let's do like, you know, couple times, couple times a week maybe. And then we've got some longer sessions where I have office hours and you can join us and get your questions answered. So that's where that accountability and support comes in.

7:33 I want to encourage you that if this is where you are in your debt elimination journey, remember these things are my mistakes that I'm sharing with you and maybe you have made them and you know what? It's OK, Obviously I made them and I still got to that debt free that that debt free, that debt free status. So just to recap, you want to start with that buffer. Do not skip that. Give yourself a budget that you'll actually follow. So making sure you budget in that fund money and then don't do it alone.

8:05 So these 3 shifts are going to change your debt elimination journey. And also it's just going to enrich this whole process for you so that you don't have to do things the hard way. You can do things the smart way, the wise way, and you can do it with a community of other moms that are like going through the same thing that you're going through. If you're nodding your head right now, but you still feel overwhelmed about where to start, I want to invite you to a free workshop that I have recently launched called 15 Minutes to Money Clarity.

8:36 So in about half an hour, you're going to get a simple action plan to finally feel organized with your budget. So you can jump on online at Jewels the Budget nerd.com/clarity and get registered. That's a totally free on demand workshop that you can take LZ the budget nerd.com/clarity CLARITY. So I hope that this episode was helpful for you today and know that the things that I regret about my journey, I am sharing those with you today so that you don't have to add those to your list of regrets. So have an amazing day and thank you so much for listening.

9:14 Thank you for listening to the Debt Rebel podcast. Now, if you want to take your next step, check out my website, jewelsthebudgetnerd.com. That's JEWLZ, the budget nerd.com. I've created a bunch of resources just for you. So hop on over, check it out and we can connect more there. If you love today's episode, I would be honored if you would hit that subscribe button and leave me a review. And remember, every step towards financial independence is a rebellion against debt. So stay strong, keep pushing forward, and fight the good fight until next time.

9:47 Debt rebels stay resilient.