5 Must-dos The Month BEFORE You’re Debt Free

What To do before you're debt free


My husband and I did our informal, Dave Ramsey-inspired, debt-free scream from the comfort of our rental home this January when we finished paying off $81,400 worth of consumer debt.  

Six months later, I’ve been thinking about what advice I would give people right on the cusp of debt-free-ness.

You’re going to be on a debt-free high right after the final payment. But here are a few things that I think you NEED to think through before you press the “submit final payment” button. Thinking through these 5 things BEFORE you’re debt free will help you sail smoothly into your new money-savvy life.

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5 Must-dos The Month BEFORE You’re Debt Free

1.Plan a cash budget for your celebration right now.

You know that you’re going to celebrate when you’ve finally dumped the debt. If you’re anything like my husband and I, we used to sit around and daydream about all the amazing vacations we would go on when we weren’t sending our paychecks to pay off debts. Mostly, Ireland, Greece and New Zealand.  

But did we really drop 10K on a post-debt vacay? No way!

If we learned anything from the debt repayment process, it’s that you need to have a money plan so you don’t throw your financial goals out the window. Instead, we set aside a very reasonable amount of money to spend on a vacation. We later decided to use that cash for year passes to Disney World since we live in Orlando, Florida. (And had never taken our kids!)

Do you want to go out to dinner? Or are you going to go away? One of my favorite ways to find affordable adventures is through Groupon. We’ve purchased Groupons for ourselves and to give as gifts and I’ve never been disappointed.  Plus, you can often find additional promotions like 10 dollars off or 30% off your order. Head over to Groupon and find out what promo they are running today. 

Whatever you plan on doing, think about it before you’re debt free so you don’t go wild and undo all the financial traction you’ve made. There are too many good ways to save on your celebration. Plus, you’ve worked too hard to blow it!

2.Decide your next big goal.

You need to have the next big concrete goal in mind or it’s easy to get sucked into old patterns of not budgeting and overspending. Funnel your debt repayment money directly into another account. For us, we knew we wanted to keep saving for a house. Shifting from one concrete goal to the next helped us avoid a “we’re rich now!” moment where we spent frivolously.  

If you still don’t own a copy of Dave Ramsey’s The Total Money Makeover, go ahead and buy it now to see what baby step is next for you.   

3.Sit down and re-adjust your budget.

Once you agree on the next big goal, go ahead and take a chance to re-adjust all the items in your budget. If you’ve been on a bare-bones, rice-and-beans budget, this may be the time to talk about giving yourself a little wiggle room for food. In our case, my husband and I decided to spend more money on family experiences, like mini golf and the zoo. After 6 months of working day and night on the fixer upper, we decided it was a top priority to spend quality time with the kids.    

4. Write down your story.

It’s so important to write down how and why you did everything so you never (never, never, never, never) get in a situation again. I love re-reading my story and remembering how far we’ve come.

5. Begin to thinking of the final debt payment as a starting line – NOT the finish line.

I know it’s so tempting to think of the final debt payment as the finish line. But it’s not the ending, it’s the beginning. By paying off debt, you get a restart on your financial future and it’s up to you to make good decisions from this point on…for the rest of your life. If you stop budgeting, taking cash to the grocery store or watching your incoming bills, you’ll set yourself up for failure. And that’s a guarantee. Learning to be good with your money is a lifelong process. Just because you paid off debt once, doesn’t mean that you won’t go into debt again if you let your guard down. There will always be an opportunity to spend around every corner.

So please, get it out of your head that once you’re debt free your money problems will be solved.  

To do before you're debt free

This may sound like tough love, but I want to set you up for success! Reframing your thoughts about what it’s really like to be debt free is so important.

Congrats if you’re right on the edge of paying off all your debt! GO YOU. Seriously, that is hard work. Most people do not even try to get to the point that you’re at. But you did it. And I hope that these 5 tips help you enjoy your new adventure that much more.

And if you’re just starting your debt-free journey, subscribe below to learn how I saved enough money to pay off $81,400 in consumer debt!

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  1. I like the idea of thinking of it like a starting line, not a finish line. I often fall in the trap of thinking I’m finished, then letting my guard down. It’s better to stay vigilant!
    Sarah | Baby Brain recently posted…8 Best Jogging Strollers Under 200My Profile

    • Yes, I fell (and still fall!) into the trap of thinking that I’m done with the BIG, hard, financial goal of paying off all debt…then I remember retirement, buying a house, kid’s college, our next vehicles, etc! It never ends. 🙂

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