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Utah couple pays off $25K of debt in one year by cutting back

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SALT LAKE CITY — A study this year from the non-profit Corporation for Enterprise Development shows nearly 44 percent of Americans are one emergency away from financial ruin.

The report shows in the event of a job loss, health crisis or loss of steady income, a quarter of Americans have less than three months of savings. But some Utahns are changing that trend.

Trevor and Katie Pierson say they've been raking in the dough these past two years.

"We paid off over $25,000 in debt last year," Katie said.

Not because they had extra income, but they simply cut back.

In their five years of marriage, the young couple has been juggling school, work, family, and all the financial responsibility that comes with that lifestyle.

"For our first three years we weren't making a lot of money and we were spending a lot more than we had," Katie said.

We paid off over $25,000 in debt last year.

–Katie Pierson

And that revolving door of debt became stressful for them.

"You can't breathe," Katie said. "Every time something goes wrong with your car all you can think about is how am I going to pay for it."

So they made dramatic changes to their lifestyle.

"You give stuff up. You don't go to a movie every single week," Katie said.

They clipped coupons.

We seriously save like what do you think? $20-$25 bucks a week," Trevor said. "We started doing it and it was an instant savings."

They traded their newer model cars for older ones and saved at least $300 a month by eating in.

"I can't take him to Wendy's without spending ten bucks on his meal," Katie said. "And so $10 times five days a week. That's expensive and that's just one person."

And they pay for everything in cash -- using this black book to track expenses.

"The idea is when the cash is out, when you're done with the cash you don't spend any more for the month," Trevor said. "It doesn't matter if you need or want something. When it's gone it's gone."

The idea is when the cash is out, when you're done with the cash you don't spend any more for the month. It doesn't matter if you need or want something. When it's gone it's gone.

–Trevor Pierson

Katie said Trevor has been strict on that rule.

"There's been times when he's made me put stuff back at the grocery store," Katie said.

This is just one principle taught in this Financial Peace class sponsored by Zions Bank. Trevor and Katie did not take this class but they borrowed the book from her parents.

"The attraction is information," said Lori Harding, a volunteer teacher for the course. "It will help you no matter what stage of life you're in."

Harding says the course teaches simple money management principles.

"Having an emergency plan," Harding said. "Saving for a rainy day."

Katie's parents, Jim and Debbie Anderson, took the course ten years ago. Not because they were in any financial trouble, but they wanted to prepare for the future.

"We do not live beyond our means," Debbie said.

It's taken them 10 years, but the Andersons say before the end of the year, they will pay their house off.

As for their daughter Katie, she and her husband Trevor say they're hopeful for the future.

"Having no debt and having our house paid off," Katie said.

You can find more information on the financial peace classes on the Zions Bank website.


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