When you follow someone online, you see small snippets of their life and have no idea what goes on outside of their profile or what happened in the years of their life leading up to that moment. Today on the Debt Free Mom podcast, I'm going to dive into the first part of Kyle and I's money story. From the time we got married to the time that we became fully debt-free, which was over three years before Debt Free Mom even existed. I'm Carly Hill and this is the Debt Free Mom podcast.
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I started Debt Free Mom in March of 2019. We were debt-free. We had three kids and we were about to buy our first house. But we had also been married for over seven years, and the way our finances looked over those seven years was nothing like it looked when I started Debt Free Mom. So I thought to close out season one of the Debt Free Mom podcast, I would take three episodes to break down our story, Kyle, and my story of money management and learning what we needed to do with our money no matter where our income was at from the time that we got married in December of 2011, all the way up to today. The big picture story I want to tell is from debt, to debt-free, to Debt Free Mom.
We got married in December of 2011 and became debt free in April of 2016. So that's where today's story starts December, 2011. Kyle and I got married when we were juniors in college. We got married over Christmas break between the fall and the spring semester. When we got married, we were both working a couple very small part-time jobs and had almost no money to our name. The first four months that we were married, we lived rent free and a couple's home who moved to Florida during the winter and they prefer to have someone living in their home while they're gone for an extended period of time. So we lived in their house from January to April. Then in April of 2012, we rented an apartment here in town for $475 a month. And we would not have even qualified for that apartment. If we hadn't had a personal connection that we found out with the landlord while we were touring the apartment. We simply didn't have enough money to our name and enough regular income to our name, to make financial sense for any landlord to rent to us apart from this personal connection.
We ended up living there for a little bit over a year, and it was a fantastic first apartment. It was 400 square feet. You had to go through our bedroom to go to the only bathroom in the apartment. And the bathroom had about a six and a half foot ceiling. Kyle is six feet tall. It was so small. The kitchen was so small that it did not have standard size fridge or oven. The oven was about this wide and the fridge couldn't even fit a regular pan inside. It was like a doll house and I was in love. I had never lived on my own outside of my parents' house before. So being on our own, having our own place, starting our life together, it felt magical. No matter how tiny the apartment was.
We started on our marriage using credit cards like everybody else. We put everything on a credit card, or we just knew we were committed to paying it in full once a month. And as long as we did that, then our finances were fine. We had no plans. I don't think I could have even told you who Dave Ramsey was. I had no idea how much I should have in savings, what kinds of debt there was, what I was facing in the future as someone who was studying to be a public school teacher. I had no idea. I just had this really strong desire to get it right, because we were 20 years old, moving out on our own for the first time. And I wanted to do well.
I think in the summer of 2012, when we had been married for about six months, I didn't get the timing of our payments right. I don't even remember what specifically happened, but I remember getting a charge for about $50 in interest on one of our bills. And at that point in our life, that amount was a slap in the face. We could not afford to be wrong by $50. We could not afford an unexpected $50 charge. I don't know what my budget method was. I feel like I probably just had things listed out on a spreadsheet and then wrote down the bills and figured out what categories we could limit in groceries and restaurants, things like that. But again, we were operating with probably about $2,000 per month. So things were very slim.
As full-time students with such a low income for our senior year of college, we also got a substantial amount of grants. We got our tuition covered and we got grants that were over and above our tuition in order to be able to pay our rent, pay our living expenses while we were full-time students. I don't like the way FAFSA works and the way they require you to report your parents' income, as long as you're single, but that's what happens. And for us, because we got married in December 2011 and then had to file for FAFSA in January of 2012, when they ask you what's your marital status and what's your income, if you are married, they no longer look at your parents' income. They only look at yours. Well, because we got married in December of 2011, we had just been married a couple of weeks when we were filling out FAFSA. But the only thing they wanted to look at was our income in 2011, even though we had spent almost the entire year as single people living at our parents' houses. So because of that, our reported income was I believe $24,000 between the two of us in 2011. And therefore we qualified for enough grants to cover tuition in our senior year, as well as a few thousand over and above the tuition, which they cash out to you as a grant so that you can live. If we had known that I might've gotten married a little earlier.
So this charge of interest on the credit card was enough to make me say, I am not doing this. I am not using this card. I am not getting us into credit card debt, six months into our marriage. And so I ditched the credit card and we began using debit cards exclusively. It took me one month of paying both the previous month's credit card balance off and being able to charge the debit card for the new month's expenses. And that was a hard month. But then we were sat for the next nine years of exclusively using our debit card to pay for our life. I kept that one credit card open, even though I wasn't using it so that my credit score was unaffected. And even grew over time, even though I was not touching the credit card. So we lived from the middle of 2012 to the end of 2021. Exclusively using debit cards.
Again, at that season of our life, I don't even remember having a specific budgeting tool or method. I remember trying the Mint app for a while, but I don't remember finding great success with that. Because we had such little cash to work with, I felt like that was almost our saving grace, that there was a set amount of things we could do with that money. And that was pretty much it. So we were in school that first year and a half. We were both full-time students, both working, whatever part-time jobs we could. I was a barista at a coffee shop and Kyle was also a barista at a coffee shop and worked at the camp that he then later worked at for a long time.
In March of 2013, we were a few months away from finishing school. We had been married a little over a year and we needed to replace one of our vehicles. We were each driving, a very old Camry, like 1993 and 1995 Camrys that our parents had gotten. I needed to return the Camry my parents had bought that I was driving to them because I had siblings that were starting to drive. And so we needed to replace that 93 Camry with something of our own. We purchased a 2006 Prius in 2013, it had 119,000 miles on it. And we still own it today, 10 years later and now has 262,000 miles on it. We bought it for $7,500, but we did not have $7,500. I had $1,300. So in March of 2013, we got a loan from a family member. We had an actual loan contract. He wrote down all the payments, all the requirements, there was an interest rate. And then we had envelopes that we put our check in to him each month and sent it to him. So that was a loan from a family member, but it was basically a real car loan. We had a loan of $5,800 in order to get this at the time, seven year old Prius.
So that was our first consumer debt that we had gone in because neither of us had graduated yet. So we didn't know exactly what our student loan amounts were and we weren't paying on them yet. In May of 2013, I graduated from college with a degree in special education. And Kyle was done with his coursework, but needed to complete an internship in order to graduate. Because both of us had lived in the same town for virtually our entire lives, we wanted to go somewhere drastically different for this internship. Because we knew it had a set amount of time. We had no kids, I had just graduated. So we were not tied to any location. And we decided to look all over the country. He found an internship for one year in Phoenix, Arizona with a church. And we moved there in August of 2013.
Now the way student ministry internships work is most of them provide you housing and the form of living with someone from the church and a very small, weekly stipend. He took this job in Phoenix, Arizona, because it had the largest stipend that he could find of $250 a week. So we moved to Arizona to live with a host family and he was paid $250 a week while working a full-time internship for this church. I had graduated, but I graduated in Illinois and I was certified to teach in Illinois, but not in Arizona. So when we moved there, I babysat for the host family on and off. And then I also started substitute teaching in the Metro Phoenix area. We lived with this family and worked these small jobs from August to November. And then right around Thanksgiving time, the church then got us a small apartment to live in while he finished his internship. I was still substitute teaching, but we also had a lot of things going on in our family back home.
In just the 10 months that we ended up living in Phoenix, we had three major family deaths. I was able to come home for multiple weeks to be with family, to attend funerals, to support people. That was a really hard time for us. Not only because we were grieving the loss of people that we loved, but because we were also a year and a half into our marriage, finding ourselves on different sides of the country, multiple times in those 10 months. And because I was a substitute teacher and a babysitter. Anytime I left to go be with family, I was also not earning any income whatsoever. So our income was very low forcing our spending to be extremely low.
Now looking back over a decade later, I can point to that time in our life as being instrumental to the financial habits and tools that we have today. Because we experienced for an extended period of time, such a low income and such a commitment to not going into debt and getting our finances wrong right out of the gate from our marriage. We got used to finding ways to enjoy life that weren't tied to spending; to get creative with the food that we were eating and the places we were going and enjoying it along the way. Learning through trial and error to not feel that it was holding us back from living the way that we wanted. I had wanted to be married for so long that some of those financial struggles just didn't feel like as big of a deal because I was married to the person I love the most, and we were living out on our own and going on this adventure in Phoenix. But that's not to say that it wasn't hard. It was so challenging and so fun at the same time.
In November of 2013, when we moved into that apartment, it was also six months after my graduation which meant that my student loans came due. I was very blessed to only have $9,000 in student loans. This was a from a variety of reasons. My freshman year of college, I got a one-year tuition scholarship and lived at the University of Illinois, so we only had my room and board to pay for which my parents very graciously and diligently paid for. My sophomore year of college I then switched schools and moved home, so had no room in board and lived with my parents again. And so they paid for my college tuition because there were no room and board costs. Then my junior year, I did take out loans and got married in the middle of that year. So that one year is what my $9,000 of student loans was from my junior year of college. And then again, because of the way FAFSA works and because we got married in December of 2011, before we filed FAFSA for our senior year in January of 2012, I then didn't have any loans for my senior year, either. So I was very, very blessed through a variety of reasons to be able to graduate with a bachelor's and $9,000 in student loans.
However, the minimum payment on these student loans was about a hundred dollars a month. And again, working with our income and our set list of expenses, this felt enormous. I had to add substitute jobs that I wasn't really excited about. As a sub, you can kind of say yes and say no. And I had a pretty strict list of things that I said yes to and things I said no to. And I had to start saying yes to some of the ones that I wanted to say no to simply because our bills were starting to go up. We continued pinching our pennies and enjoying being in Arizona, living in an area of the country we had never been before gave us so many opportunities to explore that didn't cost a whole lot. We had family come visit us a few times and be able to go around with them. And so it still was one of the sweetest years of our entire life of our entire marriage. Again, even though we were making next to nothing and had no idea what the future held for us.
In February of 2014, I then got a long-term substitute placement at one of the schools that I had been subbing for. It was an eighth grade special education math placement. I was so excited. It bumped my pay up. It gave me consistency. It allowed me to be in one classroom for the rest of the year. And I absolutely loved it. It was challenging because it was junior high. That is not my favorite age. I would take the really old students and the really little students before I would take the ones in the middle. But again, this is what was offered to me. And it was an opportunity unlike what I had found anywhere else in Phoenix without committing to a full school year. So I gladly accepted it. That job ended up being a giant blessing to us. I worked through the rest of the school year through the very end of May- from the beginning of February through the end of May in that position.
The number one thing I remember this financially being able to help us with was the fact that Kyle's student loans were coming due in June. So he technically graduated in December because he had finished enough of his internship to fulfill his program requirements. So he technically graduated in December of 2013, which meant six months after his student loans would come due in June.
Now he had about $12,000 in student loans. However, he had a couple loans that were un-subsidized and we didn't know about that until we were actually digging into the numbers to prepare for what his payment was going to be. Which meant, a couple of them had been accruing interest the entire time he had been in school. And when they came due in June of 2014, that interest that had accrued was going to become part of the principle. Once the loans were due and start basically accruing interest on the interest. Once we found that out in the spring of 2014 and knew that they were coming due in June of 2014, we basically used all this increased income from my long-term sub position to pay off that interest charge before the loans came due so that it did not become part of the principal.
So while this long-term sub position found us with the highest level of income we had had yet in our year and a half of marriage, it also found us with the largest bill we had faced in our year and a half of marriage. Logging in and seeing over $2,000 in interest due a few months from then was shocking. So we basically kept our life and our expenses the same as they had been when I had just been haphazardly subbing here and there and put all of that extra income away towards that interest charge to avoid his loan balance ballooning in June when they came due.
Now because his internship was coming to a close, he had started looking for jobs. We had looked kind of in the Phoenix area, but then he had also been talking to people back home jobs that he was familiar with. He was offered a full-time position back at the camp that he had worked at all throughout the summer in high school and college, and they offered him a full-time position related to his youth ministry degree that he had just graduated from. So he went ahead and decided to accept that and we decided to move back home. He actually moved home a few weeks before I did so that he could start this job before summer camp started, but I had not yet completed my long-term sub position and needed to finish out the school year. So I found myself again by myself in Phoenix, we had swapped places now I was in Phoenix and he was back home on opposite sides of the country for probably the fifth time in the last 10 months at that point.
The school that I was subbing at did offer me the position for the following year, and I probably would have kept it if Kyle had found something in Phoenix that he liked, but we had already decided to move home. So I gratefully thank them for my time there and moved back home. Knowing that we were moving home and that I was leaving behind this job in the Phoenix area. I was also looking for teaching positions back in our local area now that I knew that that's where Kyle would be working full-time as well. I even did a couple remote teaching interviews during my lunch break while I was subbing, trying to secure a special education teaching job.
Long story short, I ended up getting a position at a school in my parents' neighborhood, in the district that I had graduated from high school, from a principal who I had known outside of school. And she called to offer me that job as we were driving from Phoenix back to Illinois with a 1993 Camry station wagon, absolutely loaded with all of our belongings and bikes on the back of it. And I remember being at a hotel in Denver, Colorado when the principal called me to offer that position and I accepted.
So this was just a time of so much transition. So many things were changing at once. We didn't know if we were going to be permanently living away from family, if we were going back home, when our incomes were going to be, what our debt situation was going to be. I just remember hanging on trying to survive, trying not to go into debt, like I said, and just trying to exist in a way that was as wise as possible with the limited income that we had at the time.
So we arrived back home in that summer of 2014, Kyle had a very busy summer of camp. I was starting school in the fall of 2014 and at that point, all of the debt had fully come due. So we had that car, my student loans and Kyle student loans. So here we were in the summer of 2014, with about $26,000 in debt. And Kyle's position started at $30,000 in income, which we thought was so much money. I remember calling my mom and telling her that he had accepted this position and that he was paid $30,000. And she, I remember her telling me that is not going to go very far. If you're wanting to find a home or start a family or just have expenses or replace one of your vehicles. $30,000 is not going to go very far. And I remember just feeling like an instantly deflated balloon. Because compared to what we had had before, this felt like just an unbelievably wealthy amount of money. And then I get my position and I'm offered 38 K. And so then we're thinking, oh my gosh, $68,000. We are so rich. And while I now understand that amount in perspective these 10 years later, I don't want to look down on that amount either. That genuinely was over triple what we had made at any other point in our marriage thus far. And as those paychecks came in, it did feel like a lot of money for a very long time.
So you would think in the fall of 2014 with all that transition and volatility, and now this higher income, we would want to settle in and enjoy our twenties. We were only 22 years old at this point, had just graduated, we're working full-time jobs, and we will probably be looking for something a little more mellow, right? A little more consistent. Wrong. I was immediately ready to have babies. I was ready to grow our family. I had only ever wanted to be a stay-at-home mom. That was my highest goal in life. Jobs were just something that you had until you became a mom. That was my perspective at the time that was 22 year old me's sole aim was to get pregnant and have a baby. So at the very beginning of the school year in the first year that I was working my very first full-time job, I got pregnant in September of 2014, just a month after starting that job, we had all that debt. We had not paid it off. We had an emergency fund that probably had about a thousand dollars in it. And that was when we were ready. Now, again, hindsight is always 2020. I don't necessarily recommend jumping into so many life transitions at once, but that was how it happened for us. And I would say it worked out very well.
So getting pregnant in September is quite ideal for a teacher, especially a new teacher who does not have leave built up because I got pregnant in September and was due in the middle of may, just a week before school was out. So I had my baby a week before school was out. I had to use six days of sick leave to finish out the school year. And then after that I got paid for the entire summer, just like every teacher would, whether they had a baby or not. So I went back and looked at mint because I've been using it since about 2011. And you can track your net worth as your accounts are connected. And I went and looked at what was our net worth when our first baby was born in may of 2015. And it was, drum roll please, $225. So all of our assets minus all of our debt, the difference was a positive $225. We had a savings account. I think of like two or 3000 when he was born, we had an HSA that covered the medical bills. And then we had a retirement account that Kyle had just started contributing to minus all of the debt that we had not paid off yet. So again, we had our first baby with a net worth of $224 while renting a townhouse.
So given all those numbers, you would say, well, obviously she kept working full-time because she was the higher earner. Right. Kyle was making 30,000. I was making 38,000. We had just had a baby. We have a $225 net worth. I left that teaching job. I just decided I do not want to work work full time while I have my first baby, I will do what I have to do to make it work so that I'm at least somewhat part-time so that I can be home a little bit. So I accepted an administrative assistant position at our church where I worked two days a week in their office and one day a week from home. And then I also started tutoring one of my former students from that one year that I worked full time. So between those two, I was able to make about 50% of the income that I had been making as a teacher, but be home with my baby three days a week. In the office two days a week, working from home one day a week. And then the tutoring was only an hour a day, a couple of days a week.
Again, I would put this time in our life, in the bucket of "good, but so challenging." I mean, being a first-time mom is challenging. I don't care what your station in life. I don't care what your job arrangement. If you're staying home, if you're going back to work, what your income level is, that is so hard. So we were experiencing all of the newness of being parents, of being out on our own of having this baby. And then also juggling the reality of our incomes and our debt situation. I said, you know what? We have these two student loans and we have this car we have to get out from under this debt so that we can continue to have more financial freedom, more options to choose the jobs that work best for us.
So from about February of 2015, right before he was born to April of 2016, all of our extra dollars went to debt. Everything that we could scrounge up. We were living in a townhouse with a rent of $675. We were still driving those older vehicles. We were using any tax returns, anything that came our way, went onto our debt. And we paid off the remainder of that $26,000 of debt in a little over a year, April of 2016, we became 100% debt free. And I'll leave this segment of the story with this. That was also the month I found out that I was expecting baby number two.
So these are pieces of our story that you just don't get to see while following me on Debt Free Mom, because this is years and years prior to me even starting this account. So now at this point in my life, my financial life doesn't look a whole lot like what it used to look when we first got married. But what happened in those first couple years laid the foundation. 100% laid the groundwork for the way that we interact with our money now, the principles we are committed to and the way that we live our lives, regardless of how our income has grown or shrank. And regardless of the size of our family and the work dynamics. So we have bounced around between who's working, full-time, who's working part-time, where's the source of our income coming from. I had a little over a year of getting no paycheck whatsoever, from any job at all, all the way up to building a business that then became our family's primary income. So all of those things have been built on the back of what happened in those first couple of years of our marriage.
So I'm excited for part two next week to continue this story and to then talk about when we became debt free, what did we actually do? What were the goals? What were we able to do with that money? How did our income change as we were debt free, but as we were also decreasing our income because of more kids, so what did our life actually feel like?
And I'll give you a hint. The one word I would use to describe that little window of time after we became debt-free is the word disillusioned.
I'll see you next week.
(*Credits) Thanks for listening to the Debt Free Mom Podcast. If you want to join me as a guest on the show, go to dfmpodcast.com. The Debt Free Mom Podcast is hosted by me, Carly Hill, and is produced, edited, and mixed by Kyle Hill. Music for this episode was written by Kyle Hill. Hit subscribe wherever you're listening to join in with every new episode as we grow our confidence and contentment in our personal finances.
