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No, You Don’t Need a 6-Figure Salary to Get Out of Debt. Here’s Proof

Jen Smith treats Gerard Waters at St. Pete Community Acupuncture in St. Petersburg, Fla.
Jen Smith treats Gerard Waters at St. Pete Community Acupuncture in St. Petersburg, Fla. In Oct. 2015, Smith and her husband, Travis Smith, were $86,000 in debt. By minimizing their lifestyle and picking up side gigs, they were able to pay off a huge chunk of their debt. They only have $19,000 to go until they're debt free. Sharon Steinmann/The Penny Hoarder


Think you need a six-figure salary to get ahead of the financial game? These six stories may change your mind. Together, these folks paid off $218,000 worth of debt without huge salaries or major windfalls. They used only discipline, hard work and serious determination to become debt-free.

Here’s how they did it.

Francis John, 32, machine operator in Sioux Falls, South Dakota.

A portrait of Francis John
Francis John lowered his cost of living by moving into a studio apartment and eliminating dining out to help manage his student debt. Photo courtesy of Francis John

“I decided to tackle my $12,000 student loan balance in spring 2009. I was recently engaged and felt inspired to be debt-free for my bride.

The problem was that I was only earning $8.30 an hour as a bellman at a local hotel, bringing in around $1,300 to $1,500 a month, depending on my hours. Though I was already living pretty frugally and had some wiggle room in my budget, I knew I could cut back.

The first thing I did was identify expenses to scale back for maximum impact: rent, phone and food. So I downgraded from a one-bedroom to a studio, lowering my living expenses from $600 to $450. I also got a prepaid cell phone plan, cutting my $80 bill by more than half, and stopped eating out almost entirely — opting instead to eat at my future mother-in-law’s house.

Thanks to these little tweaks — plus a well-timed increase in tips at work — I was slowly able to up my debt contributions. By June 2011, I was paying off $700 per month. I made my final payment three years later, just a few months before my May 2012 wedding!

Since getting out of debt, I’ve built up a $6,000 balance in my 401(k), which is offered through my current job as a machine operator. I’ve even begun funneling some extra cash into a regular brokerage account, too.”

Jen, 27, and Travis Smith, 30, an acupuncturist and aircraft mechanic in St. Petersburg, Florida.

Jen Smith and Travis Smith kiss outside of their newly purchased home in St. Petersburg, Fla.
Jen Smith and her husband, Travis Smith, pose for a portrait outside their home in St. Petersburg, Fla. Last year, they paid off $53,000 in student loan debt. Tina Russell/The Penny Hoarder

“Thinking back on it, I can hardly believe that my husband Travis and I paid off $53,000 in student loans last year, which is about 60 percent of our combined gross income. (I earned roughly $43,000; Travis brought in $46,000.)

Related: Here's how to save $50,000.

After our October 2015 wedding, we had $86,000 of debt between us: a $7,000 car loan and $79,000 of student debt. This was a huge hurdle for our big-picture goal of homeownership, so we attacked our loans head-on — immediately putting $9,000 of wedding cash toward our debt.

Then we slashed our food budget by more than $200 per month. (A little meal planning goes a long way.) We also opted for a cheaper apartment with no amenities, which dropped our rent by about $75 per month, and funneled our $3,000 tax refund straight toward our debt.

The biggest game changer was stepping up our side hustles. Travis did everything from filing papers to stuffing newspaper coupons, while I took on freelance acupuncture work. This boosted our take-home pay to about $5,800 per month. Fortunately, St. Petersburg is a relatively affordable city — plus we were committed to our goal — so our expenses rarely exceeded $1,000, leaving plenty left over to put toward debt.

We still have about $19,000 left to pay off, but we plan to knock it all out this year.”

Delaine Moore, 28, public relations professional in Tustin, California

A portrait of Delanie Moore.
Delanie Moore had credit card debt, student debt and a car loan to pay back. Within five years, she was able to become debt free by being a frugal spender and refinancing her car. Photo courtesy of Delanie Moore

“After my 2010 graduation, I was on the hook for $20,000 in student loans and a $15,000 car loan. Then I racked up $10,000 in credit card debt over the following two years — expensive travel splurges, not budgeting and eating out all the time added up fast. Getting laid off as a social media specialist in June 2011 didn’t help, either.

I landed a gig as a communications specialist three months later, giving me a $30,000 salary to work with. This left no room in my budget for traveling (something I absolutely love), which was my a-ha moment to get out of debt.

I created my first-ever budget in December 2011 and saw that something as simple as my daily coffee run was costing me $100 per month! I swiftly changed my behavior, limiting my clothes shopping and opting for get-togethers at home instead of going to restaurants and bars. In 2012, I refinanced my car (which saved thousands) and talked my roommates into cutting cable. Over the next three years, I often paid $1,000 a month toward my debt.

Even as my salary grew — hitting $50,000 in 2015 — I maintained my frugal ways. When my car was totaled, I used the insurance payout to wipe out the balance, and even had some leftover. I then carpooled for six months instead of buying a new one right away. I also funneled all cash from tax returns and bonuses toward my debt — tackling the highest-interest balances first and using balance transfer cards.

By April 2015, I was officially debt-free! I’d even saved up enough for a European vacation. And since I never stopped kicking into my 401(k), I currently have a hefty amount saved for retirement. I also recently topped off my emergency fund to six months’ of living expenses.”

Cassie, 35, and Alex Michael, 43, a stay-at-home mom and software engineer in Salt Lake City, Utah

“Debt was part of our story for years — we even took out a loan to pay for our honeymoon. Within a few years of marriage, we’d accumulated over $108,000 of consumer debt by living way beyond our means. Everything from vacations to eating out went on credit.

Having our first child in 2004 nudged us to start paying it off. Alex was earning $65,000 as a software engineer; I was a stay-at-home mom. But we persisted, introducing severe lifestyle changes (like literally living off rice and beans).

After three and a half years, we’d eliminated $15,000 — but had serious debt fatigue. So in 2007, we created our own method called the 2-percent rule: Every month, we aimed to decrease our spending by 2 percent — a manageable amount that doesn’t require drastic measures — while increasing our income by 2 percent. All that freed-up money went to debt.

I spearheaded the income piece by selling things like popular toys, name-brand clothing and collector’s items on eBay, teaching couponing classes and flipping furniture. At first, these side hustles brought in a few hundred, but gradually scaled up to about $1,500 a month.

We focused on little ways to decrease our spending to add up to 2 percent, like cutting our grocery bills, cable and cell phone bills. (This worked for several months before we had to just focus on the income piece.)

Once we had momentum, we starting throwing about $1,000 per month at our debt — then built up to almost $4,500 per month toward the end, thanks to my side gigs and the snowball method. We also applied Alex’s bonuses and tax returns directly to debt.

We made our final payment three years later, in April 2010 — all the while, our income never surpassed $100,000.”

Related stories on Grow:

From Six Figures in Debt to Six Figures in the Bank: How They Did It

4 Habits That Helped Me Stop Scraping By

Retire at 30? Save $1 Million on a $55,000 Salary? They Did It

This article originally appeared on the personal finance site, Grow.

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