Debt Free – How We Paid Off $15,000 in Credit Card Debt in a Year


I waited patiently today at work as Josh reviewed this month’s budget. “Looks like we can pay off that last credit card,” I noted with a smiley face in my URGENT email that I sent as soon as I sat down at my desk. I was all raring and ready to push confirm on the credit card payment page when Josh suggested paying it off together at lunch. He felt it too, the excitement of the hurdle we were about to make, and he wanted in on the fun of watching the total refresh to zero.

Last year around this time we had around $15,000 of credit card debt that we accumulated during my two-year unemployment stink  – and yes I’ll admit, a few misguided purchases on top of that. Our dreams of adventures and simplistic living didn’t coincide with the monthly minimum payments we were making on our credit cards. We decided after several conversations that we needed to pay off this debt and put a hold on expensive trips and unnecessary spending.

We devised a plan and initiated it around Feb. 2012. We were able to pay off our credit card debt over 12 months by using the snowball method. This is a well-known and effective strategy to pay off debt quickly. It focuses on paying your smallest debt first by throwing all your extra funds at it while maintaining the minimum payments on your other bills. Once that debt is paid off, roll the payment into the next card, and then the next. Keep the snowball rolling…. continue this process until you’re debt free!

Snowball Steps:

  1. List all debts in order from smallest to largest
  2. Review your monthly budget and plan to pay the *minimum on all bills.
  3. Create a ‘snowball’ payment. Find any extra money that you can throw at your smallest debt.
  4. Pay off your smallest debt using the snowball payment and paying the minimum.
  5. Once paid, add the minimum payment from the first bill to the snowball amount.
  6. Apply the bigger and better snowball payment to your next bill.
  7. Repeat steps until debt free.

* Note the minimum payments. As your credit card debt decreases so will the minimum payment. Credit card companies tend to adjust this amount so you end up paying longer.

How We Sped Up The Process

  1. Applied all raises, bonuses etc. to credit card payoff
  2. Used tax returns to pay off debt
  3.  Money from minimizing my closet went to debt payoff
  4. Birthday and holiday cash gifts went to credit payoff
  5. Asked the credit card companies nicely to lower our interest rates
  6. Made additional cuts to spending. Decreased our Netflix bill, bagged our lunch, watched movies at home, bought used, etc.
  7. Used the envelope system to keep us in check.

This is a huge step for us, and we’re ecstatic. But we’re not done yet – still got those nasty student loans to tackle. More on that very soon!

5 Responses to Debt Free – How We Paid Off $15,000 in Credit Card Debt in a Year

  1. Regina says:

    great job, very
    proud of the two of you

  2. Jason says:

    It’s pretty easy to pay off your debts and follow this Dave Ramsey method when you don’t have any kids. #unrealistic

    • My Closet Garden says:


      If your means are limited, it could easily come down to a choice between financial freedom and having children. You chose kids. We didn’t- at least not yet. We just want people to know how we did it; we aren’t financial gurus. That being said, there are lots of examples of parents who paid off their debt using similar methods. Here’s a great one:

      – MCG

  3. Rebecca says:

    Awesome! This inspires me, thanks for sharing!!!

  4. sunya says:

    What was their annual income? I listen to Dave Ramsey & his debt free screamers usually make way over $100,000 a year. Someone who makes an average salary of $30,000 to $40,000 a year would have a harder time paying off debt fast. I know Dave says to get a 2nd job, but you may not be able to find a baby sitter. All parents are not married. Some are single, divorced or separated. I’m working on a financial system for this group since Dave’s plan really does not benefit this group.

Leave a reply