How This Single Mom Stopped Using Credit Cards and Paid Off $31K of Debt With a Simple Budget System | 575

0:00My daughter loves to spend like she gets money in her hand and it's like mom can we get to the store right now. And so speaking on like just the you know passing this down. We did start like she has many little savings buckets that she you know she's earning money. She gets to spend half her money which is a nice little chunk of it. And then you know she has tie that we have like a savings and then she's saving for certain things and and I told her I was like you're probably gonna hate me now. I get it because I'm taking like half your money and like putting it in these other things. But when you are older and you're making like real money and you keep up with this, like you will never have to struggle with the things that I've struggled with.

1:00or if you're using credit cards to get through the month. 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. We 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.

1:37We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on a conversation. We can help you no matter where you're at, whether you're the single mom who's never had$500 in their savings account, or the millionaire who's paid off four real estate workers. And we're not going to shy away from the tough love. We'll tell you what you need to hear and encourage you at the same time. This is the Financial Coaching for Women podcast. Sarah, thank you so much for being on Financial Coaching for Women. We're so thankful to have you. You sent in a message to us just talking about all the success that you had with our Simplified Budget System, and you shared a little bit of your story.

2:14So why don't you introduce yourself and kind of tell the audience who you are and what you got going on? Yes. I'm so excited you guys reached out to me. That was like one of the best emails I've gotten in a long time. so I am in South Carolina I'm a solo mom I have a 10 year old 10 year old daughter and was married for 12 years I've been separated divorced for about three now so it's a very different life it's been financially very different um I've been very blessed like I got to live with my parents for a while and kind of get on my feet and I we built a beautiful little home so like I'm I'm in a great situation but finances I am definitely a spender I have learned that about myself and so kind of got myself into a little bit of a mess.

2:59I knew Dave Ramsey for forever. It was just way too strict for me, to be honest. And I stumbled across you guys. It's been about a year and a half. I was trying to go back and like, look, I've been really using the budget for almost a year now. And once I started listening to you guys, I was like, the tagline that caught me was the, you make good money and have nothing to show for it. And I was like, oh, I'm making more money than I ever have. And here I feel like I just, I can't get ahead. I have been religiously listening to you guys. I'm probably on the lower end of your people, you know, that we, that you guys talk to.

3:34So sometimes you guys will throw out budgets and I'm like, oh man, that would be nice to make that much money. But we feel the same way. Like, look at that. I'm like, wait, they have$10 ,000 a month. Like, that's crazy. But you guys have brought on people that make more in like what I make. And I just, I appreciate both of you so much. Like it's just been, I've probably listened to every single podcast you guys put out. So I've talked to coach Michelle several times. I bought the whole system. So I am here for it. And it's definitely a journey. Like you guys talk about, like there are highs and lows and it's taking me a lot longer to get where I want to get to, but it's also like, you're never really going to truly get where you want to get to.

4:13Like, you're just always going to be improving and changing. And you guys realize that. So I appreciate that about y 'all. Well, that, that is very sweet. I think I told you before we came on, you are exactly what, who we do, what we do for, because spoiler alert, you mentioned in your message to us that you've been doing some work about your debt and that's where like you've been, you've been really plugging away even, even as a self-proclaimed spender. So tell us a little bit about where, where you're at right now, what's coming up and then maybe like, what did you do like implementing the budget system to get you there?

4:50Yeah. Yeah. So I think one of my biggest things I tried to do like take out cash, you know, for spending, but there's so many things nowadays that you just you can't do it that way. Because then I was like using my regular debit card and then tried to think like, oh, I got to deposit this cash back. And it just that was not working. So I mean, how simple is it to like open a checking account for spending and pay myself every Friday? I do do every Friday. Like I can't do the biweekly thing. i'm a weekly girl friday i get it yes girl and like i cannot do this two weeks thing but knowing like that's gonna go in every friday and then you know thursday comes around i don't have but ten dollars then i just can't get whatever it is you know and like get a deal drink that's it right yes so i i did your one page budget for a little bit and it kind of played around with it a little you know and then finally like I was on with coach Michelle and I was like you know what we're just gonna do it we're just gonna go in we're gonna do it I watched all the videos and so I think July of last year was my first full year that I like really committed to it and I'm telling you all it was all over the place like I had way too many things in bills and I mean so I had so I have fallen prey to a timeshare that I'm really trying hard to get out of and then I didn't have a ton of debt.

6:16But so my thing with credit cards was they would get me with the doggone points every single time. And I'm like, I can pay it off because I know I have the money. So I would get like, you know, the TJ Maxx card because it gets points. And then I get like a little$10 certificate at the end of it. I got the Lowe's card, you know, and like it was all of these different things. And I was keeping up with it until I wasn't. And then all of a sudden And it was like, so I was married for 12 years. We ended up, we separated. That whole first year is kind of a blur to me. But it was like, I mean, I am a spender and I thought I was more of a favor, but I'm really not.

6:54And it was just easy to go. And there were things that I spent good, like I invested in some things like personal coaching and health coaching and like things that were really good. But they also cost a lot of money that I didn't necessarily have at the moment. And so it just kind of added up, you know? And so when I started listening to you guys, I was like, you know, this is really important to me. Now, here's my thing. If I would like get out of debt, but then I would go right back into it because I didn't have a plan for like buying other things that I knew I was gonna have to buy. So when you guys started talking about saving buckets and like, and I love your approach of, you know, we don't have to focus on getting out of debt right away.

7:39it can be like one of our side things that we're kind of you know working on but also like when you're out of debt what do you how are you going to pay for things you know so I am so proud to say I have not put money on a credit card in probably nine months or so maybe a little bit more and then I paid off my final credit card last month and I have called y 'all I pulled up my credit report just to see like the different accounts i've been closing accounts left and rights and like like how in the world did i have so many accounts i just don't even know how to happen it just happened so i've been calling accounts i'm getting those paid off my house so i built on my parents land which i'm so glad because they you know didn't charge me for the land which is like half of what it costs now i took out a loan for some of the house it i had a plan to pay it off in five years, I actually have been really diligent about like bonuses and then, you know, just some extra things that have come in.

8:42And if not next month in July, I should make my final payment on my home. And then besides the timeshare, like I have nothing, but I also have these savings buckets on the side that when things come up, I have money to pay for them. And I'm like, this is crazy. I love that. I think that this is such a rewarding story. It's just great. I feel so much more confident in my money. Like I know where my money is. I know where it's coming from. I know how much it costs for me to live every month. Whereas before I probably couldn't tell you any of those things, you know, it would take me some time to like dig it up.

9:20Even the fact of just like being able to go in and like close accounts, nobody's going to be able to hack me because they're not going to have accounts to hack into, you know? up the point. So, so just, yeah, I'm, I'm just very grateful and it, it made a huge difference in my life for sure. Well, you've come like literally full circle on everything. If you look at where you were a year ago versus where you are now. And I love how you said that it was a journey and that it's been a journey and it's going to continue to be right. We, we like to say 90 % of your budget can be pretty much automatic.

9:54And then you have the 10 % of things that you're tweaking here and there. But I also love how when you started the system, you knew that you weren't going to be able to make all the progress and do everything you wanted to do month one. And we tell people like, look, this isn't a quick fix situation. That's not what this is. This is literally lifelong. It's a different way to handle and manage your money so that way you can be successful for a long period of time, not just what you want to fix today or even next month. And you understood that. You did the work. You started small. You started where you knew you needed to start first.

10:27And you made the progress. And look at you now, just under a year later. So do you have an amount of debt that you want to show that you've paid off? I don't know if you have those numbers. Yeah, I do. I actually wrote them down. So just this year. So here's what's also crazy, I'll tell you guys. And you've probably heard this before. I'm probably not the only person. But I switched jobs about a year ago. and I thought like my 401k like I thought I had rolled everything over you know and everything was good I have a financial advisor he was telling me like you know we're all good well I get this call from my old company's 401k company and they're like hey like your assets are sitting in here like you know do you want to change anything or make any changes and I was like no they're not I already rolled them over and they're like no you didn't like they're still here so sure enough I logged in and there was this huge chunk of money from the nine years that I was at this company sitting there.

11:23And I was like, oh, thank you, Lord. So I was able, I mean, my financial advisor was like, ah, this is not, I'm not going to suggest that you take out the money, but I was able to take out some of that like as a cash from the rollover. And that's what helps me pay off my house. And then I was able to put most of it back into like my other 401k to rollover. But just this year, so this is May. So just this year, I've paid off$24 ,027 of debt. And then last year, from July to December, I paid off about$8 ,000. So just like in less than a year, from July to now, it's been$31 ,914 of debt that I've been able to pay off.

12:09and it had it's going to put like I think it's eighteen hundred dollars back into my budget every single month that was gonna be yeah that was gonna be my next question like you feel like you got this huge pay raise yeah yeah it's crazy I was like where am I gonna put all this money I don't even know you don't have a mortgage to pay you like have some fun savings buckets yeah you better get some buckets going oh my gosh oh you better bet travel was like the first one i was like oh we're gonna start working on this guy yeah i love that and you know as far as taking a little bit of cash out to pay off the house you know this is a personal decision and you know vanessa obviously has a very personal story with that where maybe the finance bros would say don't do that blah blah mortgage interest rates blah blah blah uh no i have eighteen hundred dollars back in my in my budget.

13:01I don't have a mortgage to pay and I still have lots in the investments and I can start being a really good investor even more so now. So I, and I'm happy and I can sleep at night and I'm happy. And so it's just really important for people to hear. It's up to you how you want to use your money. All right, budget besties, it's time for some real talk. You don't need another budget. You 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.

13:33And it's going to give you permission to spend. Everybody loves that. 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. And 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, back to today's show. Don't listen to everybody else tell you what you must do.

14:07It's not cookie cutter. It's up to you. Well, even if you take, you said it's going to be $1 ,800 back in your budget. If even if you take$800 of that and spread it amongst whatever savings buckets you want. And even if you want to beef up a little bit of your spending accounts or whatever, you can now, if you wanted to, invest$1 ,000 a month again. That can be who you are. You're a lifelong investor at$1 ,000 a month. What you're going to make on that and compound interest over time and the amount of stress that it is relieved from you for being mortgage-free and paying off all your debt. And you didn't take all of it.

14:40You just took a small amount of it. And so I just think that, again, it's a personal decision, however you decide to do that. But you You have to look at all of it from every single angle and decide what's the best decision for you, not necessarily what other people are telling you and what the finance world thinks you should do. Yeah. And I kind of struggle with the decision a little bit, honestly. But what I did find, too, is that the fees that were taken out because I took it out early were pretty comparable to what I would have paid in interest anyways. And so it just was a wash. And it just kind of worked out to her.

15:15was like oh this makes sense you know so so once once this timeshare is taken care of i will like owe no one anything and it just it feel and i will have money i already have money set aside you know i'm halfway to building my six-month emergency fines um and then savings buckets are set up i do have five savings buckets and two of them are money markets actually um actually i have interest because yeah so i have two that are money markets that one's for my daughter for when she turns 18 just that she has you know something out there and then one it's for a car i have an 11 year old car that's working perfectly fine and so we're just going to keep rolling with it yeah right until it blows up no big deal i mean we're just gonna keep going and then i have money that i'm putting into that money market so when it is time to get a car it's just like, oh, here is cash for my car.

16:12And I mean, how amazing is that going to be? I want to say to like, I have so many, I have so many notes of other things I want to say. But as you're saying that, what I heard is, and you're young, like you're young to have all of these things accomplished. And I was thinking how your parents blessed you. And that's amazing. And you're going to be in the same position, you know, having a little bit of money for someone when they're 18 is great. But when your daughter is older, you're going to be in a position to help her when it really matters, you know, like in those moments, you know, hopefully, you know, not necessarily the same exact situation, but maybe she starts a business.

16:47Maybe she's starting a family, maybe whatever. And you'll be able to bless her. And that's kind of like the whole point. Like you're sleeping better at night and you're able to be a blessing if you want to be a blessing. Like, and you can go on the travel vacations. Like this is why you do it. Yeah. This is what we tell people like this$197 investment that you're going to make is going to not only bless you, but it'll bless your kids and so on and so forth. Like it allows you to learn and understand how to handle your money so you can continue to bless your family, you know, years down the road.

17:17Okay. Yeah. Sarah, I have something else. I'm sorry. I told you I have. I made lots of notes while you were talking. I did too. Okay. Well, you get to go next. We'll go back and forth and let Vanessa talk when she gets a chance. Okay. Here is the thing that I wanted to hone in on. You said, I'm a spender. I'm a spender. I'm a spender. and it just hit me like again this is the shame judgment that we put on ourselves not that it's fine if you want to be a spender like let's go let's all go out and spend for it i'm all right but what i've been what we've been even talking about today is actually did you just not have a budget system and you didn't know how you didn't literally didn't know how to save or were you paying eighteen hundred dollars in minimum so you literally didn't have any money to save because look at you right now.

18:00You have five savings accounts. You're saving money. You paid off debt. You paid your house off. So I just don't necessarily know that you were like, yes, you spent money. But I think a lot of it has to do with not knowing. Like we are not taught how to budget. We don't know how to manage our money. We don't know the right way to save money or the right way to spend money. And that's what's actually happening. It's not like this personally, oh, I'm just a spender. Maybe you are, but maybe also you don't you just don't have a system that works yeah yeah and this system has been like the automatic like it just moving things to where it needs to go has been and so i'm also the person who like still has my bills debit card in my wallet i know it's terrible and it's like my next big goal i know y 'all are not gonna like that you're almost got a new so sorry i haven't used it in like two months but it's like they're just and every time I hear you guys say that on a podcast I'm like oh they're talking to me but you know with that like yes I don't like my daughter loves to spend like she gets money in her hand and it's like mom can we get to the store right now and so speaking on like just the you know passing this down we did start like she has many little savings buckets that she you know she's earning money she gets to spend half her money which is a nice little chunk of it and then you know she has tie that we have like a savings and then she's saving for certain things and and i told her i was like you're probably gonna hate me now i get it because i'm taking like half your money and like putting it in these other things i said but when you are older and you're making like real money and you keep up with this like you will never have to struggle with the things that I've struggled with you know like you just you still need to spend money I mean we went to France two years ago we spent a lot of money going to France two years ago but it was also I mean it was before I met you guys so it was you know I probably could have done it a little bit differently and next time I will but that trip is all paid off right now anyway right but nobody else on that France trip and so it's just you know those little things of just like let's get in the mindset now while you're 10 and you're making you know$20 a week and we can you know put these things um so it's just it is like you said it's a mindset shift completely because it's like yes I could go out and like buy whatever but you're really paying more mentally and emotionally when you don't have that money there and set aside for it you know and I just think about all of this like interest that I've paid for nothing like literally like it just feels like you're just throwing money out the door and so now everything is just set up and of course I have things to improve on and I think I always will it's always going to be changing and growing but like my financial life last year compared to now is just like night and day difference.

21:08It's crazy. Well, I love how you said you're paying more for it emotionally and mentally when you don't have the cash and you're using a card card. I think that's very true. I've never heard it explained like that before. And I think that that makes a lot of sense for people because when you swipe a card, you're now making a problem for a future you to solve. And you're feeling the weight of that the second you use a card, because, you know, technically if you want to buy something, but you don't have the cash to buy it, you can't afford it, right? But the replacement of that, well, I'll just swipe a card.

21:39Well, did that really feel good? And then now you're having to pay for it later. When something happens, like maybe your card breaks down in a month and you thought, well, I'll have the money next month to pay for that card, not knowing that there's something else that's going to happen, that now that money goes to that because it always happens that way. And it just, again, creates this massive snowball of debt that you rack up that you didn't intend to. We never intend to do it, but we just use it as a scapegoat as far as like, okay, I'll just use it this time, just this one time to get by. And then it just ends up being this mountain.

22:09And so I do, I do think I love that, that it is a, it's a bigger problem for you emotionally and physically that you're, that you're carrying. Yeah. Yeah. And so this is, it's just been, it's been a change. The whole swipe the card, you know, that's my 10 year old's favorite thing to say is like, I'll say, you know, we don't have money in the budget right now for that. And she's like, well, don't you have a card? And I'm like, I do, but there's not money on that card for the situation. You know? I mean, we just did that yesterday. Went to the grocery store. I had like literally$10 left in my grocery account because tomorrow it's Friday or today is Friday, but I had like$10 yesterday.

22:44We needed a bag of chips. And she's like, well, let's get this. And I'm like, I don't have the money for that. Like I have the money to get chips and then tomorrow we can get more groceries. And she's like, but don't you just have a card? Like, can't you just i was like no baby it doesn't work that way like where are they here we're gonna stick to this yeah they're learning where yeah they i know yeah like money does not just appear so we've had a lot of conversations about like credit versus debits you know when she wants to borrow you know money and that she doesn't actually have i'm like well then you would get charged interest you know and then you end up paying more and she's like that just doesn't make sense mom And I was like, well, that's the way of the world.

23:23Like, let's figure this out now. Yeah. And along with the whole idea about how you, you know, labeling yourself a spender or whatever, I think the other part of this is, and this goes for your daughter too, is the only things that we're taught or that are, you know, that are shouted at us about finance is about spending money. It's either about credit or it's about buy this, buy this, buy this, buy this. And that's really all the education. and we get it thrown at us so often even young even the young ones you know if they have any like movies they're watching or whatever they're still they're still seeing all of it and so that's the only education we get so we really like you're doing so good to combat and actually have these conversations with her and help her with tithing and saving and all of that like it's so important and you know there's so much other noise out there that like you just want to try to get a little bit of this in and common sense for them so you know bravo to you for doing that And sticking to it, I know it's really hard probably to say no or to just give her boundaries.

24:22I know. I'm proud of you for saying no. Yeah. Oh, good. And it's not necessarily like, and I love how you're wording it. You're not saying we don't have the money. We're broke. It's no. It is. That is not in the budget right now. And that is okay. Tomorrow we can have ice cream. Yeah. Was it ice cream? Right. Was it ice cream, Sarah? Exactly. Chips. Yes. Oh, we love beans. No, what was it besides the chips? Oh, yeah. What did she want beside the chips? oh she wanted i think she just wanted like a cookie or something yeah it was something sweet wise yeah we did the same thing with a dress the other she found like this dress was on sale and i was like well we just i said you because i've put it on her for extra clothes like i'll buy your stuff that's needed you know and she's like well i don't have that money right now and i was like well then we don't get the dress for you now so when you said that her that she's like mom you just have a card swipe it my favorite and i think vanessa's here too our one of our favorite lines now that our kids have their own accounts is well you have money when they ask her something well you have money you have money did you want the same thing and she's like she'll carry something through the store and then all of a sudden at the end of it decide like i don't want to spend my money on it today because it's her money yeah exactly it's so weird how that happens it is she can spend my money very easily very easily they're really good at that yeah well i think it's like my daughter did that she wanted some jewelry and she's like mom the website's having a huge sale i need to get it today and i said girl you better pray to jesus that that's still on sale when you get your when you get your allowance because i nope it's you already spent it you went to starbucks with your friends you went and bought a book at books million you're out girl you gotta wait yeah yeah Yeah.

26:04Good luck with that. So have fun. Well, I love it. I love the generational story here too, with your parents being able to bless you and then you doing all of like, you know, the, all of the work to do to get to where you are today. And then now your sweet 10 year old daughter is getting all the early lessons in life. So congratulations to you. You know, we're like, it was started off. You're the reason that we do what we do. And it's so rewarding for us to hear your success and how well you're doing. So thank you so much, Sarah, for, for not only doing that, but also coming on here and telling us your story.

26:36We're so excited for you. Yeah, it was such a lovely conversation. Thank you for taking time out of your day to share it because we know that what you're saying is going to hit somebody and it's going to resonate with them. And then, you know, hopefully that they can change their financial trajectory as well. I hope so. Yeah. If I could tell anybody anything, it would be like, this is so worth it. And, you know, don't expect success overnight because it's not going to happen overnight. But, But I think if you just keep going and just keep doing it, then you're going to see just great things. So I appreciate both of you too.

27:08I love listening to you all every week. Well, thank you so much, Sarah. We hope you enjoy the rest of your weekend. Start that soon. Yeah. If you make good money but have nothing to show for it, this quiz will help you figure out what's really going on with your money and what your next step should be. You'll get a personalized result and a simple action step to help you feel more organized and less stressed. Go to budgetbesties.com forward slash quiz and take the free quiz today. That's budgetbesties.com forward slash quiz to find out what's really going on with your money.