Ready to declare debt independence? Read these 5 inspiring stories

As the Fourth of July approaches and we prepare to celebrate the adoption of the Declaration of Independence with picnics, fireworks and parades, we thought it fitting to tell the story of a different kind of independence — independence from debt.

We reached out to five people who declared their debt independence to ask how they won their freedom – and how they celebrate it.

Bouncing back from financial infidelity – Janet Lombardi, author of “Bankruptcy: A Love Story”

Getting into debt: Lombardi’s husband ran up a $50,000 business line of credit that she was unaware of until it appeared on her credit report. He had, as it turned out, attached her name to the credit line, an experience Lombardi writes about the experience in her new memoir, “Bankruptcy: A Love Story.”

“I had never spent any money attached to that line,” Lombardi says. “I didn’t even know it existed.”

The declaration of debt independence:
Lombardi met with a financial advisor who told her that, in addition to running up lines of credit, her husband had been siphoning money out of their shared accounts.

“At that point,” she says, “I declared that I would get to the bottom of our finances, separate myself financially and get out of debt.”

The fight for debt independence: Lombardi looked her financial situation in the eye, tabulating all spending and expenses.

“Once I had a complete picture, I created my own punch list – what I needed to divest to become debt free,” she says.

That included taking bold measures like selling her home and buying a less expensive place and joining Debtors Anonymous. Her seven-point plan of attack can be seen on her website.

Celebrating debt independence: To this day, Lombardi writes down all her expenses, creates spending plans and meets with her Debtors Anonymous partners.

“I still attend meetings after 10 years,” she says. “I call DA the Weight Watchers of finance: healthy and manageable.”

Finding meaning in spending less – John Schneider co-founder of Debt Free Guys and co-author of “The Four Principles of Debt Free Life

Getting into debt: Schneider and his husband, David Auten (co-founder of their site Debt Free Guys), found themselves with $51,000 in credit card debt “because of our limiting beliefs about money, ourselves and what we were worth,” Schneider says.

While Schneider’s weakness was big-ticket items, Auten had a habit of making multiple small-item purchases each day.

The declaration of debt independence: The pair decided to turn things around while sitting on the dining room floor of their basement apartment.

“We were two 30-something professionals renting a basement apartment,” Schneider says. “Our peers were passing us by, and we took a long, hard look at ourselves.”

The fight for debt independence:
Determining what they were fighting for kept Schneider and Auten on track. Their “carefree clubbing days and expensive lifestyles,” Schneider says, were fun, but what the couple ultimately wanted was as secure retirement, travel and the ability to help others.

“When we figured out our ‘why,’” Schneider says, “we had the motivation and inspiration to do whatever it took to pay off our debt.”

Celebrating debt independence: The couple celebrated their final debt payment by saving for a 30-day, all-cash vacation in Australia and New Zealand. They saw Kylie Minogue in concert, went to Sydney’s Mardi Gras and snorkeled the Great Barrier Reef.

“We returned to the states with $0 on our credit cards and a fortune in memories,” Schneider says.

Side-hustling to financial freedom — Chonce Maddox, financial coach and blogger at My Debt Epiphany

Getting into debt: In 2014, Maddox was a new grad with about $30,000 in debt — $21k in student loans and $9k in the form of an auto loan.

“I remember graduation was bittersweet for me because I didn’t have a job lined up and had no idea how I was going to pay off my debt,” she says.

The declaration of debt independence: When Maddox thought about her life goals (marriage, travel, more time with her son, no stress about money), the six digits she owed loomed large.

“I realized that debt was the huge obstacle holding me back from achieving the life I really wanted,” she says. “So I got mad at my debt and decided to do something to change it.”

The fight for debt independence:
Maddox started her blog for accountability and motivation. Her attack was two-pronged: Keep expenses low and earn more money. To achieve the latter, Maddox held down a day job while maintaining various side hustles. Today, her side hustles are her full-time job (she quit her 9-to-5 job last year).
She’s down to her last $5,000 in debt.

Celebrating debt independence: When Maddox makes her final debt payment, she plans to go out to a celebratory dinner with her family – and then get back to work, rolling the money she used to put toward her debt toward saving and investing.

“Debt payoff is only the beginning, and I want to do so much more with my money,” she says.

Evading sneaky debt: Kim Galeta, personal finance and lifestyle blogger

Getting into debt:
Galeta bucked the trend of her generation by quickly paying off her $32,000 in grad-school loans quickly, thanks to getting a good job after graduation.

Unfortunately, “I still did not have a good handle on the rest of my finances and, as a result, $13,000 worth of credit card snuck up on my husband and me,” Galeta says.

The declaration of debt independence: Galeta and her husband got serious about financial freedom when they realized that, after their mortgage, their consumer debt required the next-highest monthly payment.

“We were tired of living paycheck to paycheck despite earning a good income,” Galeta says.

The fight for debt independence: Galeta and her husband attacked their debt from many angles. They tracked their spending, became a one-car household to save $600 a month, made judicious use of a 0 percent balance-transfer offer and refinanced their mortgage to save another $600 per month. There were some life-outlook adjustments, too.

“We understood that short-term sacrifices will lead to long-term gains,” Galeta says. “Learning contentment has been key.”

The couple paid off $45,000 in debt in two years.

Celebrating debt independence:
Galeta and her husband are saving for retirement, building up an emergency fund and aggressively paying down their mortgage (they’ve set a pay-off deadline of five to six years).

A fun-money fund keeps them on track.

“Our fun-money fund isn’t huge, but I think it’s important to have some type of treat now and again to make this process more manageable,” Galeta says.

Overcoming debt inertia – Amanda Page, blogger at Dream Beyond Debt and personal finance writer

Getting into debt: Between college and grad school, Page racked up $49,800 in student debt.

She then carried that balance for a decade, making the minimum payments on a graduated payment plan.

The declaration of debt independence: After a decade of minimum payments, Page realized she’d paid off barely $1,000 of her principal and told her mother, “I will probably die with student loan debt.”

Page’s troubling choice of words became her declaration of independence.

“It made me angry,” she says. “Then, it made me take action.”

The fight for debt independence: Page started by taking additional work over the holidays and selling stuff on Craigslist. She didn’t have a car payment and kept her living expenses low “with a roommate in a ridiculously inexpensive housing situation,” she says.

Page soon found herself able to make a “monster payment” of $4,300.

She then launched her blog, found support in the debt-payoff community online, took on extra work wherever she could, made more money in a year than she’d ever made before — and paid off her debt in 14 months.

Celebrating debt independence: Page celebrates her debt independence constantly by tweeting daily three things she’s grateful for, she says.

Technically, though, she doesn’t consider herself debt free yet.

“Exactly one week after making my final student loan payment, I bought a house,” she says.

After saving up $100,000 for retirement, she plans to go to battle against her mortgage.

“The thing that keeps me motivated to keep my debt independence is the notion of independence,” she says. “…I want my money and my time to be mine.”

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