From $3K in Debt Payments to $2.4K in Savings: How One Single Woman Took Back Her Finances | 434

0:00We're excited to tell you about one of our clients who was single, one income, and she came in and paid off$263 ,000 in total debt in less than a year. and$69 ,000 of that was not including a mortgage. We're excited to tell you exactly what she did to go from paying$3 ,000 a month and just in her debt minimum payments. She took that number and crushed it to be 1 ,200 only, right? And like when I said, it was less than a year. So she went from 3 ,000 to$1 ,200 in minimum debt payments monthly in less than a year. Single income. Single income, y 'all. And also she went from having no savings, no emergency fund, to setting aside every single month now$2 ,400 for savings.

0:43Imagine saving$2 ,400 for all your unexpected expenses. Do you make good money but have nothing to show for it? Are you tired of living paycheck to paycheck? Do you have big dreams for your financial future? Do you want to get debt-free but you don't want to live on beans and rice? Or you don't want to give up those pumpkin spice lattes? Hey, it's okay if you don't already know how to budget or if you're using credit cards to get through the month. Hey, it's okay if you want to seem like you have your finances all together, or you're not on the same page with your spouse when it comes to finances.

1:14We know what you're doing probably isn't working, but guess what? You're in the right place. We're Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey. We've been in business since 2019, helping hundreds of amazing people like you create budgets, get out of debt, stop living paycheck to paycheck, and know exactly what to do with their money. In this podcast, we'll share with you everything we know, plus everything we're working on with our clients so that you have the best chance at reaching your financial goals. We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on the conversation.

1:49We can help you no matter where you're at, whether you're the single mom who's never had$500 in her savings account or the millionaire who's paid off four real estate mortgages. And we're not going to shy away from the tough love. We'll tell you what you need to here and encourage you at the same time. This is the Financial Coaching for Women podcast. We had a lovely client come join us for coaching last year. She was with us, I believe, for seven months. She started in June, ended in December because she wanted to kind of finish out the year with coaching, and then we would make her January budget for her for the new year.

2:23So she was, she's single. She had a steady full-time job. She also had a massage business on the side. She was a massage therapist. And that had, that income was super inconsistent. However, you know, between us talking, it's like, it can be inconsistent or it can be consistent. Like we, you get to decide that. And she was trying to sell her house. I remember our first session, we sat down and like did all the numbers of what that would look like if she sold her house. Cause that's really what she wanted to look at. She wanted to downsize into like a condo. She had a lot going on, but she didn't really make all that much money, and that was okay.

2:57So she was making$7 ,500 a month, which is actually pretty great for a single person. That's a decent income. She had a good amount of debt. Even without the mortgage, it was still$181 ,000. So she had some work to do, right? She did. And that included, you guys, there's some variety. You can pick and choose like a bouquet of flowers. I was just going to say the exact same thing, like a bouquet of flowers. Just have any kind of debt you want to throw in there and make it look a little different, suited to you, right? So she had credit cards, bank and personal loans, a vehicle loan, RV loan, and debt consolidation, a furniture loan, and a HELOC, a home equity line of credit.

3:37Do you think we had a problem to solve? I think we feel like we had a problem to solve. There seems to be a little credit thing going on that we were going to help her with. Yeah, she definitely – Used every available credit option. She did. She really did. And then that was all after. So if you see what Shana said, she had a debt consolidation loan and then all these extra loans. So she had already consolidated it once, and this is everything that she racked up afterwards. And so we were paying on 10 different debts, and that was about$3 ,000 a month and just minimum payments. Goodness gracious.

4:08Like, that is more than a mortgage. And$3 ,000, remember, we said she made$7 ,500. So almost half of her income was going to debt. And that's not fun. Nobody likes that. Yeah, no. It was really hard for her to figure out the math. For her, the math wasn't mapping, and it was hard for her to see. She had all of her business finances mixed in with her personal finances. There were no boundaries, no organization there. She didn't know how to separate it. She had no business accounts as far as no business savings. With her being a massage therapist, there are things that you need, right? And you need supplies.

4:41Maybe you need to – I think I had a couple massage therapists actually as clients, but they need a new chair every so often. They have to buy towels. They have laundry that they have to do. They have to buy their oils or lotions or however that works. But she had no way of tracking any of that or understanding like when she was supposed to buy stuff and how she was able to afford it. Yeah. And I think that that's, it starts off so innocent, right? Well, I just have this one little thing. I'm going to kind of do it. And so you, you allow it to mix in with your personal finances, but it absolutely not.

5:08Vanessa says all the time, your accountant will thank you. And that's true. But also you want those clear divisions, clear lines. And so it's easy to get into that, but always know the answer is going to be separate business from personal, even no matter how small the side hustle feels like it is, you want to separate it. It's going to make everybody's job easier in the long run. She also felt like she had to pay herself immediately from her massage business because she, and we hear this actually a lot of people that have side hustles or second, you know, their own little business on top of, on top of their consistent income because they need the money.

5:38Like she needed the quote unquote, needed the money. Didn't know if she had enough in her regular account from her regular job. So every single time, every night when she got paid, she would pay herself instead of setting up like a consistent paycheck for her from her business. She also, as you might guess, had high insurance premiums because that's one of Vanessa's specialties is to help you figure that out. She had like, you know, she had unnecessary warranties, expenses that were all mixed together. Sometimes you you don't know because you haven't looked at it all. It's also very helpful to have someone else look at it to help you be like, that's not why, but why?

6:16And that's a lot or whatever. Yeah. Yeah. She was budgeting manually in her spreadsheet, meaning like she had no idea what was going on with it. And it wasn't like natural to her because nobody, she had never done it before. She had purchased our system, but was struggling with like having an accountability partner, right? Because she was single. and so she really needed a second set of eyes to see it because she was so close to her money and so close to her budgeting ways and her habits that she couldn't see any other way how to do things and yeah and she was also supporting a family member and you know a puppy or puppies puppies plural like that's a lot so she had a lot going on is what we're trying to say even as a single person she had a lot going on a lot of different loans that she's trying to keep up with a lot of different side business family members she was helping dog like it was just a lot so we told you where she started and now we want to tell you where she ended because it was really phenomenal like the amount of money that she was able to pay off so at the end of coaching she was in there seven months she was able to pay off 263 000 in total debt and remember um she downsized she finally was able to sell her house there's a lot of like red tape and a lot of situations that she had she had to go through to fix that but 69 000 of that was not was not her mortgage yeah that was money that she scraped together and actually paid debts off she obviously set up a system as vanessa just said she was kind of like all over the place and there was no accountability but she set up the system with 13 accounts okay this is not scary this is great this is a good thing and she separated the bills uh the business stuff from the personal stuff um and so that also allowed her to automate her savings, which is something we teach.

7:59And she went from, remember Vanessa said, no emergency fund, no savings, nothing to setting aside$2 ,400 a month in savings. So like, think how like transformational that is for somebody who is single and who's a fur mama, um, able to downsize, pay in cash for all of her home renovations when she was moving into the condo pay for everything for the total cost of the house that she was selling and now she's able to to put aside twenty four hundred dollars a month for all of her savings buckets which include things like christmas travel home maintenance her pets for you know for the year for grooming and their their visits and the heartworm stuff um a home repair like all like everything clothing her glam up stuff like all of that she was able to put aside very generously for herself$24 a month.

8:50Like that's huge. Yeah, it's a big deal. Okay. I think that's really great. And I'm really glad that you're excited about that, Vanessa, but I don't even care about that as much as we told you her minimum payments that she was doing monthly was$3 ,000, right? Which is almost half of what she was making. She got that down to$1 ,200 a month. Imagine the relief. Obviously this is part of why she was able to save so much money, but imagine the relief to know that I don't, I do not have to send away$3 ,000 a month on debt, like on stuff from the past anymore. And she's down to 1 ,200. Obviously she's super successful and awesome.

9:24So she's going to even get, get that further down, but that's huge all by itself. Yeah. And you know, one of the things that she absolutely loved was now that she has money in the account, there's no more like random charges that have to happen. Unex quote unquote, unexpected expenses that come up throughout the month. She has her savings bucket set up. She's pulling from them to pay for everything in the moment. She has cash. She's just able to really, really understand what's happening with her money. And I remember when we were making her budget and I was telling her how much money she had left over.

9:53She was like, there's no way that that much money is left over. But it was, it was just math. And I think it takes somebody else to make it who's not emotionally attached to it to show you that it's actually there. And we'll show you how. Yeah. And I don't remember where I heard it recently, but borrow, you can borrow our belief. I think that's also like we believe in you. We believe that it's going to work. And you may not have it at first, but you can borrow it from us. And then you'll see it where she's at now. She graduated. She's sailing off into the sunset. And she's able to live it. But maybe in the beginning, she just needed to trust Vanessa, trust the process and believe or just be so confident because we seem so confident.

10:32Yeah. And it will work. And so, yeah. And I think what you said without saying it is she became her own bank. instead of constantly going, or not constantly, that's not the right word. But as we noted, she had many varieties of debt. So she kept going to the bank and finding a new one. Now she can go to the bank and like you said, pull from her travel account because she's going on a trip. She doesn't have to get a credit card or a line of credit or anything. She's her own bank, which I think is huge. Yeah, absolutely. And you know, and she built a net worth of$684 ,000 after all this was said and done.

11:03She has$900 ,000 in assets and only$215 ,000 in liabilities, which is mostly her home and that silly little heloc was i think the last um little thing that took to go but yeah she just now everything is consolidated like her debt tracker is there's so much less going on it's just i love that for two little lines in there right and you know she now has a clear plan for and the cash ready to pay for property taxes for any prepares all her holidays and we said unexpected expenses but like and her business is separate from her personal everything is just really organized. Yeah. And just the before and after, no money for savings, lots of credit, no emergency fund.

11:39Now she has an emergency fund. She has money saved for her taxes, for her repairs. Like she has money for everything, all over the place, money for everything. And she's like hair flip, got a great net worth and everything. So, and now I'm sure she can look at this business in a whole different light. Whereas it was like a lifeline, like, you know, blood or oxygen to her budget because she didn't have any money. Now this business, she can, she can put her heart into it with less financial, like does need and less financial stress. And, um, and I'm sure you helped her set it up to be super, um, organized and actually be profitable probably too.

12:12Yeah. And she actually messaged us a month ago and said, I just want to let you know that I have a new job and I'm getting$10 ,000 more a year than I was getting. And she was miserable. I was a brag about it. Gosh. I know. And she just started her own travel agent company. Like she's just doing fabulous and I'm so happy. And she's a wonderful aunt. Like she doesn't have many kids, but she's a wonderful aunt to all her nieces and nephews. And she's able to just spoil them because she has the cash to do that and she can feel good about it. Yeah. So love that. So, okay. Before and after we told you all the debts that she's paid off, all the savings that she's doing, her net worth, but how?

12:44Tell us the how, what did she actually do with her hands to do that? Because if we tell you, maybe you could do it too. Yeah. Just some free little coaching tips. All right. So she bought our system, but she was having trouble with implementing it because she did not have an accountability partner. It was hard for her to see. Yeah. Like she was in it. She was too close to it. Habit mindset, like all of that was not changing because nobody was there in her corner. So then she signed up for coaching and she was in the program for seven months. So she opened up three ally bank accounts. Okay. As we've mentioned before, sometimes you guys have resistance to this.

13:17Just trust us. Can you trust us? Because it works. It's going to help you. You're going to have an account and you're going to know exactly what's going on with your money, exactly how to afford everything that you need to afford. And it's going to be so organized. Your bank is going to act like it's like going to be the living embodiment of your budget. And it's going to be great. So she opened through it to your bank accounts. So you should too. Yeah. Yes, you did. It's like somebody jumped up the bridge. So you should too. But this is actually a good thing for you. But she's also, the next thing we did was set up her automatic transfers for not just the money coming into her account for her business, like systematically, but we also did it for her bills, her spending, her savings.

13:53She was so afraid to be able to pay a bill on auto pay because she didn't know if she had the cash for it. She didn't know how much cash she had for herself or for groceries and gas because it was all messed up. And once we had those separate accounts open and she started setting up the automatic transfers, I think she did hers to set up with her consistent income that she had from her regular job and it matched it. So it was really, really nice for her to know that she always had money coming in for herself. Yeah, and I just want to go back and reiterate the 13 bank accounts. Those were going to be the bills.

14:25It was going to be her spending, her gas and groceries, her restaurants if she had it. Those were the specific ones. And then she had savings accounts. And I think it's important that you point that out. And I want to reiterate this. That's your first step. Open the accounts. Put$5 in them. Good. Check. Go to bed. Take a little nap. And then we're going to come back. and even if you can't set up your transfers on automatic, we still want to be very systematic about it. So I have several clients that maybe it's going to be a month or two before they really feel confident about everything happening.

14:57Automatically, yeah. But we're going to tell you that you're going to set a day, most likely on payday, that we're going to use the budget that tells us exactly how much and we're going to transfer it to those accounts. Then all I have to do is worry about budgeting within the account. Like I have$500 for groceries. I can deal with that. So that's a step. And understand you don't have to go this quick to automatic transfers. As soon as you're able to, you should because it's going to make your life easier. Yeah. All right, budget besties. It's time for some real talk. You don't need another budget.

15:26You need a budget system. Our simplified budget system is what you've been looking for. It's going to allow you to be bougie on a budget. You'll be able to easily set up a system that runs automatically and shows you exactly where your money is going. and it's going to give you permission to spend. Everybody loves that. Yeah. It's straightforward, pretty, and packed with walkthrough videos that break down the exact methods we use with our clients to get out of debt, set up a bills account, separate spending, build savings buckets, and end the paycheck to paycheck feel. If you're new to budgeting, this is the perfect way to jump in.

16:00And if you're already a budget nerd like us, you're about to meet your new obsession. This is the upgrade to your finances that you need right now. Yeah. So head on over to budgetbestdc.com forward slash budget and grab yours. Now back to today's show. The same goes for your bills. You're going to, once you get that income set in there, get your bills account set up and the income going in there, set those up as automatic bill pay. You can trust the math. You can trust yourself. It's going to work. And the only thing that's going to be happening in that account are bills. So you can feel good about setting them up to pay automatically.

16:34Again, save yourself the time. You don't need to pay anything manually. That is so 2008 yes you may have a water company that we do like we used to where you have to manually go pay a check there may be one left in the in the country like that other than that everything ought to pay well and life is so busy you don't you just don't have the time or you shouldn't want to do that like it's just not it's it is a waste of your time so uh okay so at her very first session i like i said earlier we sat down and she wanted to know if she sold the house for this price what could she pay off with that money and so we made a plan and we saw it we're like this is what you're going to be able to use to pay off debt and this is what you're going to be able to use for your new house and everything.

17:09But what we knew was in the meantime, we got to work. So in the meantime, we decided if we can pay off as much debt as we can, because that was her goal. She didn't want to set up her savings buckets at the beginning. She wanted to pay off debt and just pay in the moment for things that were coming up in those months that we were coaching. So we decided to pay off as much debt as we could in those seven months. And what happened was by the time she did sell her house, it was supposed to sell like the very first month of coaching. And then it got pushed back like four months. So then by the time she did end up selling the house, she had that much less money that she had to put on debt because we already did a bunch of work, right?

17:47We said she paid off$69 ,000 in just debt payments during her months of coaching. And so she was able to use that extra money for home renovations, like condo renovations, upgrades, and things like that before she moved into the new place. And I like that. So, you know, not everyone can coach with this, but again, you can come to a free call, budgetbuzzies.com forward slash live call. We'll coach you one-on-one. But I like it because it helps you. It's like a gamified it. And we do this, like the first client that you had or not the first, but one of them, you put little lines in their debt tracker.

18:15Like once we get to this, then we're going to go on a date. Once we get to this one, like little milestones. And this is her way of gamifying. Like how much can I do before even as big lump sum that I have? And like, you want to know your numbers and find a way to gamify or get excited or like focus on your goals. Like the more you focus on it, the more it's going to be possible. You're going to know the numbers and you can get motivated and stay motivated to do it. And so I feel like that like gamified it for, but you should find a way to do that for yourself too. Um, again, like come on a free call.

18:42If you can't figure out, we'll help you. Yeah, we will. We love to do that. Um, and I want to reiterate too, that we didn't just pay off debt and she lived on beans and rice this whole time. She lived, she went on trips. She paid for stuff for her little niece on, you see, like a dance competition or something she went to. Um, she had a good old time. So please don't, I don't want you to hear what we didn't say. She had a chance to have a good time in the seven months she was coaching and also pay off a ton of debt. And she also did something that we want you all to do every time, which is call every one of those creditors, debt companies, whichever ones that you're listing out in your debt tracker.

19:16You're going to call them all. You're going to see if they can offer you a lower interest rate or a deferment sometimes. So I have a client right now. We're actually strategically waiting for her, which month she's going to ask for her vehicle to be deferred. Because we're going to need that. We're going to need that coming up, right? But you can get your vehicle loan one month deferred. It'll just add it to the end of the loan. And that will free up that money for one month. And sometimes that's really going to help you. It's going to help you get ahead or something. So we want to do all of that.

19:45Go through, contact them, see if they have any payment plan or something that's going to be more advantageous to you or make your budget life easier. And then also maybe if you can defer something here or there, that will help too. Yeah. And she sat down and calculated when we got closer to the end of coaching, I had her sit down and look at how much she costs in a year for, to do her savings buckets, because the savings bucket tracker, isn't like a sit down at one time and fill it out. And it's going to be good and dandy. We recommend like, Hey, print it out, put it on your nightstand. As you think about things or as things come up, you know, write it down.

20:17And the goal here isn't to be perfect, but it's like, Hey, how, how much does my pet actually cost me? how much are all those travel sports that we pay for every all the you know throughout the year um what what are all the summer camps that my kids actually attend and what what is my bill for that so just kind of look at all that and so when she spent a couple months doing that here and there not like hours at a time but just just slowly she was able to figure out how much money she needed to put in all of her accounts to help her prepare for the future yeah um i have to tell you i was thinking about travel sports so hold on let's think about what i was going to tell you about Travel sports.

20:52I saw a video of Gary Vaynerchuk dissing travel sports. So I was reminding myself to tell you about that. Okay. Is that the same one that I just saw? Probably. I probably showed me and showed you at the same time. Probably. What were you saying? I was just saying she did her savings bucket. I think a lot of times we don't know how much we cost. We're hoping that we're not so expensive, and it's important to look at it. And especially when you said your pets. like I think I've had several clients lately be like I didn't know that they cost so much I'm like okay well they do and then that's just a pet let's let's not even look over here in the the human child um and and don't even talk about if you're adding travel sports but I what I was thinking Vanessa when you were saying that it's like you know how we don't want your mortgage to be like you know Dave says about a fourth of your um of your take-home income that's a good general rule, right?

21:44It's obviously going to change with everybody. But think about that when it comes to some of these things. Like it really should be in alignment with how much money you make, not how much you want to spend, right? So sometimes we'll look at your budget and we will lay out those travel sports and be like, this is why you feel the way you feel. So either you got to make more money or you might have to say no to a tournament or two or something. But that's why it's so important to get it on paper, see what it costs. And then you can solve for it. You can make a decision either way, but you need to know how much you cost.

22:15I think that's really important. Yeah. So for her, it was knowing how much her business costs her, like how many oils she had to buy for her massage company, or the lotions, the towels, the laundry, like all of that. What did that, you know, how much is she spending in a year? And so we had her make that list and then open up a separate massage related expense account. So that way she could fund it every month. And then whenever she needed money for it, then easily enough, she could just transfer and buy her things. Yeah. And I think that, again, it's one of those things where they think it's going to be annoying, more trouble than it's worth, but it really makes things so much more clear when you do that.

22:54And one of our clients' favorite things is that it gives them a clear way to save for taxes too. And knowing that they're actually saving for it instead of just waiting for that monkey to come jump on her back at the end of the year or two years later, whenever they actually decide to look at it. But the way that you would set up your business stuff, lots of clients are like, it feels so good knowing that I'm setting aside for these things that I know I'm going to have to pay for and I'm setting aside for taxes. And I can clearly see, I think it's also really important to clearly be able to see how much money you're making.

23:23Because when you're just, when it's all mixed up or you're just like, you know, like you said, taking as soon as you get paid, taking it, you don't really know how much you're making. How can you set goals? How can you like try to do better one month or know that, okay, this one's going to be lower or whatever. Like it really helps everything to be clear. Well, and I think you have a lot more annual bills with business. Sure. Like especially with us. Well, I say especially with us. We are a small business. I can imagine what bigger businesses have. And, you know, it's really nice to have an account that says annual bills, like business annual bills.