Categories
400 payday loan, direct lender

This couple used the debt snowball method to pay off $130,000 in four years

This couple used the debt snowball method to pay off $130,000 in four years

Married couple Brian and Lindsey Baldwin used to be among the 44 million Americans struggling with student loan debt. Now, the Massachusetts couple is debt-free. The Baldwins, both 37 years old, say they tackled $130,000 worth of student loans in four years by combining extreme minimalism with Dave Ramsey’s “debt snowball” method.

The Baldwins went to graduate school together in New Orleans, and graduated in 2010 with eight different student loans between them. The couple say they spent the next two years in deep denial about how much money they owed.

“We were living off loans,” Lindsey Baldwin tells NBC News BETTER. “We were paying for school with loans, we were paying for rent with loans, and we were just living the high life, I would say, because it hadn’t sunk in, the reality of it all.”

Instead of focusing on paying back their loans, they went on vacation in South America and lived in Hawaii for two years.

Brian says, “It didn’t feel like we were really in that bad of shape, and we didn’t think about what we were doing. We were just in denial of this growing snowball rolling forward.”

The couple moved to Milwaukee, Wisconsin, in 2012, with combined loan payments totaling $1,200 a month. Their largest loan was $35,000 at 9 percent interest.

Lindsey became pregnant with their first child, a son, that year, around the time the interest on one of their larger loans suddenly spiked. Paying back the debt felt impossible, but the Baldwins say they knew it was time to get serious.

They went on a strict budget

The Baldwins lived as inexpensively as they could. They set a strict $500 biweekly budget for living expenses, not including rent and utilities.

“We lived really frugally,” recalls Lindsey. “We had one car. Brian biked to work.”

Lindsey quit her job as a social worker to take care of their son. Brian, a digital map maker, began working full time for the city of Milwaukee.