I’m a financial advisor but was $100K in debt
Here’s how Tania Brown and her husband changed their mindsets and created new rules to pay off their debt
This article originally appeared in OfColor, a platform established to improve the financial health of people of color. It has been licensed by Upwise.
I grew up poor. My earliest notion of money was watching my mother sitting at a kitchen table, head in hand, looking with despair at the bills in front of her trying to decide which would and would not get paid. She would stare at the bills, then at a picture in our kitchen that said, “Lord, help me hang on one more day.”
“This is just how it is,” I remember hearing.
Things got better for me in my late teens when I joined the military. For the first time in my life, I had steady money coming in. But I also had a steady stream of credit card offers, and quickly found myself in debt.
I didn’t realize the credit card payments weren’t optional, and my creditors eventually sent non-payment letters to my commander. As “punishment,” my supervisor had me create a plan to pay off the debt and begin saving money each month. We added up all my bills, and I focused on paying off the lowest balance while paying the minimums on the other credit cards (it’s what’s known as the “snowball method” for paying off debt).
A year later, I realized for the first time the importance of having my finances in order when my grandmother died. Without the plan I had in place, I wouldn’t have been able to pay for both my and my mother's travel expenses for attending the funeral. It was the first time I saw the impact money choices have on our ability to make meaningful life decisions, like being able to support family members when they need it.
Getting married and in debt
That experience resonated with me, and I decided to train to become a financial advisor. But even with my newfound perspective, the poor money mindset I grew up with run deep. I married someone with a similarly poor money set, and our financial decisions spiraled us into over $100k in debt. We constantly fought about money and even considered divorce.
The child who believed that money is bad and poverty was inevitable was unconsciously informing my financial decisions. As odd as it may seem, I didn’t trust that we’ll have the money to save, so instead I used credit for just about everything. I also didn’t connect my day-to-day decisions to long-term consequences.
I felt so much shame, fear, and hopelessness during this time. By social media standards, I was over 35 with a good job—people in my position are expected to be independently wealthy, not broke.
“I was embarrassed to be a financial professional struggling to make ends meet.”
What I learned as a financial advisor, primarily about investing, did little to help us manage our money habits and mindset. As humbling as it was, I decided to learn everything I could about money management basics. I read articles on the topic and enrolled in courses.
Here’s what we did to get out of debt and build a healthy financial life.
Audited our spending
It’s embarrassing to admit, but I didn’t really know how much I was even spending. I read that the first thing to do is gather a few months of statements. But the thought of spending hours combing through statements hurt my head, so we did one month.
“What surprised us was that we weren’t really over-spending on anything specific.”
We were experiencing what I call “financial death by a thousand cuts.” We were “dollaring” ourselves into a financial hole, spending $5 on this, $10 on that. It was the small day-to-day choices that really hurt us.
Prioritized debt payments
The next thing we did was add up our debt. We used a debt calculation tool to gather all our debt information and found our debt was higher than we thought. We then used the calculator to create a debt payoff plan.
Sold our house
We knew we had to be honest with ourselves and make some hard decisions. We thought of the life we wanted: freedom to spend our time, talent, and money on the people and causes we care about most.
As we reviewed our finances, we realized we could not afford our home. It left us little room to cover our expenses, and any financial shocks spiraled us into debt. Keeping the house meant living in a continuous crisis, so we sold our home.
Made commitments to our future
We knew if we weren’t careful, we’d be right back where we started. So we started saving up an emergency fund of $2,000 to prevent us from taking on new debt in the face of unexpected expenses. To stay out of debt, we learned how to pay for everything upfront and with cash.
We prioritized our careers, seeking out special certifications and new jobs that would pay more, but we also resolved to avoid “lifestyle inflation.” If we earned more, that money went to cover our debt (that included any bonuses, tax refunds or other unexpected windfalls). We decided to stick to “staycations” and reward ourselves once were debt free by taking the kids to Disneyworld.
“We stopped medicating our feelings of inadequacy with material things and learned to find contentment in our increasingly secure financial position.”
A stronger financial foundation and a stronger marriage
Once we paid off the debt, we committed to living on one person’s income and saving most of the other spouse’s income. Our marriage was repaired; once we stopped blaming and fighting, we were much stronger as a team.
“We have the peace of mind of knowing that if we’re hit with unexpected expenses, it's an inconvenience instead of a crisis.”
We paid off more than $100,000 in debt in about five years, despite two totaled vehicles and health issues. Our savings and wealth grew more quickly than we initially hoped, and yes, eventually, we could take the kids to Disney.
The biggest lesson I learned is that financial success is about more than just saving money. Your mindset can still sabotage your best efforts. I also have a greater appreciation for the importance of having mentors, whether it’s family friends, or your commanding officer, that can model sound financial behavior. That’s ultimately what inspires me to work so hard on passing on everything I’ve learned via coaching people of all income levels on their finances.
This article was written by OfColor and was legally licensed through an agreement with OfColor. Please direct all licensing questions to legal@OfColor.com.