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Melissa Goes Minimal to Crush $40k

Suddenly, it was clear—every time I spend money on things that I don’t truly need for my well-being, I’m choosing debt over freedom.

Personal finance is a funny thing: We don’t learn about it in school, and it’s taboo to speak openly about how much we earn (or owe) once we’re out of school. On top of that, we live in an insanely consumer-driven culture—go buy, and go big!

And I’d fallen into the trap. You think, “I can pay off this credit card in a few months,” or “Minimum payments are sufficient.”

Then, before you know it, you’ve racked up $7,000 in consumer debt, $24,000 in taxes from your small business expenses, and $37,000 in student loans. Guilty as charged. (Although, I’m pleased to report that my minimum payments have knocked down those student loans to a mere $29,000, even if it has taken longer than I’d like.)

The acknowledgment of my $60,000 debt was painful. It was my rock bottom and, thankfully, also served as a wake-up call.

I Was Ready to Become Debt-Free

In the fall of 2016, I read a book called The Spender’s Guide to Debt-Free Living. I was drawn in by the title because, hey, I’m a spender and I wanted to live debt-free. The premise of the book, by Anna Newell Jones, is simple: For an entire year, spend money only on your needs, and forgo all spending on your ‘wants.’

The trick, of course, is figuring out what your ‘needs’ and ‘wants’ are.

When I first read this book, admittedly, I thought, “This isn’t for me—it’s way too extreme.” But a year later, I read the book, again. With fresh eyes, I realized that cutting back was actually not that big a deal. Holding onto my debt, however, was a big deal (and not in a good way!).

That was it. By December of 2017, I’d made a deliberate and powerful plan to pay it all off as quickly as possible: Over the next 12 months, I would become a conscious spender and put a significant amount of my income—my goal is 40 percent or more—towards debt repayment.

The First Step Is the Most Difficult

So, back to those ‘needs’ and ‘wants.’ They’re tricky because there’s no right answer—one person’s ‘need’ is another person’s ‘want,’ and vice versa. With that, my first order of business was to clearly define each for myself. Here’s what I came up with:


Housing and feeding myself are obvious needs. But what about the things that support a healthy and reasonably happy life? To make it clear, I came up with these four parameters:

  1. Basics: Rent, transportation, groceries, utilities (gas, internet, phone, cable) and insurance (health and home). Must-haves.
  2. Physical Health: Groceries that nourish me and a gym plan that keeps me active? Worth it and necessary for long-term health.
  3. Social Connection: I set aside a minimal monthly budget for important events and gatherings with the people I care about. I’ve also got a minimal annual budget for travel related to experiences that I can’t put off—like weddings and visiting family once per quarter.
  4. Business Expenses: Website maintenance, essential software subscriptions, accounting services and business fees that can’t be avoided.


My red flag goes up when a purchase allows me to be lazy or stuck on appearances—the optional things that, while they light us up, aren’t essential. For me, that boils down to:

  • Recreational Education: Books, conferences, online courses, networking events, etc.
    Clothing: I have plenty, already.
  • Vacations: Not this year.
  • Gifts: This is one’s hard, and it includes over-tipping, wedding presents, birthday presents, Christmas gifts and the random things I’ve tended to do in the past (like buying a round for friends). 2018 will be the year of thoughtful cards and DIY presents.
  • Entertainment: This one’s blurry. It intersects with one of my ‘needs’—social connection. I’m going to try to focus my socializing on walks, cooking dinner and cheap nights in, but I have some wiggle room, as long as I don’t exceed my monthly event budget.

Putting It into Action

My goal is to pay off two-thirds of my debt—about $40,000—by the end of 2018, and I want to be 100 percent debt-free by the end of 2019. It’s taking patience and willpower, but a few months in, I’ve cut my monthly spending by more than half!

I’m more in control of my financial destiny than I have been for most of the past decade, and it’s such a rewarding (and exciting) feeling.

If you’re feeling inspired to get out of debt, don’t wait. Seriously, you can’t fully appreciate how good it feels, until you start seeing your progress. I know I’m putting in the work, but it’s still shocking, in the best way, to see how far I’ve come.

A Word on Accountability

And I’ll end with a tip that’s been helpful for me: Build in accountability to help you stay on track. I’m going to document my progress via this series of blog posts over the next year (watch for them on YNAB’s blog!). But you could also send updates to a close friend, share on a public forum or you might try the anti-charity method over at Stickk.

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Melissa Goes Minimal to Crush $40k