The debt consisted of a mixture of things: a $15,000 car loan on a Ford Explorer, a $90,000 mortgage on an investment rental property, and $275,000 on their primary mortgage.
When the couple got pregnant with their first child, that debt load began to take on new meaning, particularly for Depiesse, who, growing up, had seen his family home get foreclosed on.
“I’ve seen some of the struggle and I just didn’t want that for my kids or my kids’ kids,” he told The Money Manual. “You can never get foreclosed on a home that doesn’t have a mortgage.”
Kicking Off A Debt Free Journey
When the couple started paying off their debt, Depiesse was a high school business teacher, and his wife was working as a recruiter. Together at the time, they were making a combined income of $175,000.
A few months into their debt-free journey, the couple had their son Callahan, and Depiesse became a stay-at-home dad. That meant his wife became the primary breadwinner.
They continued ahead on their debt-free journey, paying off their car loan quickly and selling off their rental condo that hadn’t turned into the moneymaker that they initially hoped it would be. From there, they decided that they would go ahead and tackle their mortgage.
Our story is a little bit unique in that regard because most people would probably have let off the gas a little bit when they got to their mortgage.
“Our story is a little bit unique in that regard because most people would probably have let off the gas a little bit when they got to their mortgage, but we decided to just plow right through it,” he shared.
Living Below Their Means
The key for Depiesse and his family was to live below their means. They didn’t go on any vacations. They didn’t go out to eat. They cooked all of their meals at home.
“I wish there was a secret, and it’s almost embarrassing to talk about it, because there really isn’t a secret,” he shared. “We just didn’t spend a lot of money [as we tackled our debt]… I wish there was something more sophisticated to tell you, but that’s really it.”
In the couple’s final year of their debt journey, they had 56% of their take-home pay going to their debt.
Depiesse encourages everyone to look at tackling debt in terms of ratios.
If someone says to me, ‘10% of my take-home pay is going to debt’ I’d probably say to them that they are not being intense enough.
“If someone says to me, ‘10% of my take-home pay is going to debt’ I’d probably say to them that they are not being intense enough,” he said.
Holding Yourself Accountable
“If you are not radically accountable to [your debt] then you’re not going to change anything,” Depiesse said.
Per Depiesse, one of the ways to do this is to look up your lifetime earnings at SocialSecurity.gov to see how much money you have made in total. When Depiesse did this right before his family started their debt-free journey, he learned that he had made just over a million dollars, and his wife had made just under a million dollars.
“I looked at the two million dollars we had been given and we had nothing to show for it and that’s when I kind of got angry,” he said. “How could we do this? How could we have two million dollars come through and slip through our hands with absolutely nothing to show for it?”
This anger and passion turned out to be a great motivator for Depiesse to power through.
Income, Income, Income
Per Depiesse, people often make the mistake of focusing too much on cutting their expenses without spending enough of their energy trying to up their income.
It wasn’t Depiesse who increased his income, but his wife. Because she was in a commission-based role, she was able to find additional ways to earn, and then put that additional money towards the couple’s debt.
I would challenge people to think about what’s more impactful: cutting their expenses in half or doubling their income?
“I would challenge people to think about what’s more impactful: cutting their expenses in half or doubling their income?… I would argue that doubling their income is more important,” he said.
He suggests people plan out how to double their income in five years and to figure out the steps they need to take to get them there.
“Is it more education? A certificate? Mentors? Investing in a personal growth program?…Maybe it’s all of the above,” he suggested.
Now He’s Helping Others
It took the couple 38 months, but this February, they became fully debt-free. It was no small achievement, and now Depiesse is turning his attention to helping others.
“During this process, I enjoyed it so much that I got licensed as a financial adviser because I want to walk with people through this process as well.”
What to hear more about Depiesse’s debt journey? Check out Episode 5 of The Money Manual’s podcast “Let’s Talk About Debt” to learn more about his story.