Getting out of debt – one family’s amazing success

My friend and her husband are on a journey to get out of debt. They gave permission to share a few lessons they are learning along the way.

Sometimes you have to spend money to fix the problem

They hired a reputable financial coach to help them for several months. They have regular Skype appointments. He offers them advice, encouragement, tough love, specific steps to success and accountability.

This might not seem like a logical first step. After all, spending money has led to debt in the first place. But if you have not been able to get out of debt on your own, it might be time to try something radical like hiring help. And spending money on accountability makes you take it more seriously.

The numbers don’t lie

To get out of debt, you have to face the numbers. Doing an overview of the numbers made this couple realize their expenses were greater than their income, even without unexpected expenses.

INCOME MINUS EXPENSES can’t be negative. Otherwise, you have to make more or spend less (or both).

This couple initially estimated their debt before meeting with the financial coach. Once they tallied their debt from various sources they had a pleasant surprise—they owed thousands less than they thought! This part of the process might not always have a happy ending, but it is still important to face the numbers.

Selling items can add up quickly

They had to come up with a $1000 Emergency Fund as quickly as possible. Of course, it felt impossible since they were not making ends meet even with regular expenses. His answer? Sell things. Little things. Big things.

Within one week they had set up their Emergency Fund. Within a few more weeks they sold over $3000 and put a large amount towards debt repayment. They sold a snowmobile, some furniture and many extra items their children had outgrown.

Success leads to success

Anyone who has experienced debt knows that discouragement makes you feel like you can’t climb the mountain. Once this couple started getting out of debt, they felt encouraged to keep going. When the debt tally started coming down quickly, they were motivated to stay committed. Motivation is a powerful thing.

There can be incredible, unexpected surprises [READ CAREFULLY!!]

Did you know that if money sits untouched in a bank account for more than 10 years, it is transferred to the Bank of Canada?

Once there, it waits for the original owner of the account to claim the money. Most unclaimed accounts have less than $1000 in them, but others have large amounts.

My friend’s husband searched the database and found over $11,000 in an account he never knew had been opened for him years ago. His full name and birth date matched the account, and after some verification, they were issued a cheque for the full amount!

Make sure you search under variations of your name, and your maiden name, if applicable.

Be patient

We live in a quick-fix society. Waiting for solutions can be challenging. But just as debt usually accumulates slowly, we can’t expect it to disappear overnight. And simple steps like not spending money can make a huge difference.

In closing

Here on MapleMoney.com, we encourage readers to spend wisely and take control of their finances. If you are discouraged about your debt, I hope that this story will encourage you to take a first step in the right direction.

What do you think holds us back the most from conquering debt?