Getting out of a big pile of debt on a low income.


My husband and I were both raised in working-class families. My dad painted billboards and his dad worked on oil rigs. But we also happened to be the low-income kids in a wealthy, exemplary school district, so the expectation that we would go to college was high. My husband is a first generation American and my parents had high school educations, so neither of us really understood the college system. We didn’t know there was really a different in cost between private colleges, state colleges, or community colleges. We both just knew that a college education was the ticket to a better life, however much it cost. What we didn’t know was that just a few short years later, we would find ourselves trying to get out of a big pile of debt on a low income.

My husband started his college career at a private university far from home. We were high school sweethearts and I followed him there. We both took out the maximum amount of student loans available to us. We later decided to come home to Texas, get married, and my husband continued his education at a state school. We’d been advised by a family member that student loans were “good debt” and that it would make sense to take out every dollar that the federal government would give us and live on it, if we needed to.

My husband graduated from college the day before our second child was born. Six months later the bills started to roll in and I realized that we were in very big trouble. We were now sitting on a pile of student loans and credit card debt and my husband had just started a job teaching at a private school. This high income we expected just wasn’t there.

Thankfully, around this time, I stumbled on the Dave Ramsey radio show (now it’s a radio show and podcast). Dave Ramsey has a very simple financial plan for people that is ideal for people that have little to no financial education. Every Friday, listeners call in with their “I’m debt FREEEEEE!” screams, which pumped me up every week!

The first thing I did was to take an inventory of our income and our debts. Seeing that debt number in red on my screen that day was embarrassing and devastating. But I had been religiously listening to Dave and had hope that we could get out of debt on our low income. We started learning how to budget, which was so hard at first but got easier every month.

Dave’s first step is for you to save a $1,000 baby emergency fund. It took us NINE months to save up $1,000! I was a stay-at-home mom with an infant and a toddler. I committed to making everything from scratch. I sold baby things I wasn’t using. I got a part-time job at the YMCA where I could take my kids with me to work.

The next step is to list your debts from smallest to largest and attack the little one! Our first little debt was to a family member who had lent us a few hundred dollars. It felt SO good to pay them back and to get the sweet note that they hadn’t expected it back but that it was such a blessing to them at a difficult time. We worked our way through more family debts, a furniture loan, a car loan, credit cards, small student loans, and big student loans.

We decided at a certain point that if I could get a degree and work full-time we could speed things up so I applied for every scholarship I could think of. We did not add one dime of debt for me to finish school. My degree allowed me to also start teaching and supercharge our debt payoff.

10+ years later our life looks so different.

We got out of debt on our low income. We have 6 months of savings. My husband moved into school administration. We added two more kids. We live modestly, but comfortably. There is always money for the things we need and usually money for the things we want. Now we give more and I eventually learned how to invest. I don’t stay up at night wondering how we’re going to pay the light bill anymore.

So if you’re struggling with how to get out of debt on a low income, know that there is hope that one day you can be debt-free even on a low income.


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