How We Paid Off Debt, Built a House & Bought a Car by Age 21

Created for Eden
by Created for Eden

Today we are going to share our financial journey and talk about how to pay off debt. In one year, we were able to pay off all our debt, which was about $22,000, and pay for the renovation and building of our tiny house, all in cash for $17,000 and buy a car for $8,900.

We were able to pay off our debt, get a car, and build this house because we lived simply and were super frugal. So today, we wanted to share with you how we did it.

1. Tithe

So now we're going to get into how to set yourself up for a better financial future and pay off your debt. The first thing that we would recommend 100% without fail is to tithe.

If you don't know, tithing is the first 10% of your income, and it goes to the local church. Ever since we have had jobs, we've both tithed. Since we've been married, we've tithed. We can vouch that it is the best thing you can do for your finances. The Bible is clear.

In Malachi 3:10, it says:

Bring the whole tithe into the storehouse, so that there may be food in my house. Test me in this," says the Lord Almighty, "and see if I will not throw open the floodgates of heaven and pour out so much blessing that there will not be room enough to store it.

We have seen repeatedly that as we've tithed, given the first 10% to the local church, the other 90% is just so much more blessed, and it feels like it's multiplied. It's the only point in the Bible that God tells us to test him because it does work.

2. Track all money you make and spend

We used an app back when we first got married called Debit and Credit. What we did was we categorized and manually entered everything that we both made and spent.

That was helpful for us to know precisely where our money was going and to accurately know how quickly we could pay off debt and build this house and buy a car.

Tithe money

3. Live simply

Along with tracking every penny that you spend, something that we would recommend is to live simply and to live within your means. Dave Ramsey says to live like no one else so that later you can live and give like no one else.

In that season of trying to tackle debt, maybe cut back a little bit or a lot of it, don't eat out as much, make your coffee and tea at home, eat simple meals, try and find ways to save money, and put as much as you can toward that debt.

It's not about the big expenses usually. It's about the small sacrifices over time.

4. Tackle debt first

The next thing that we'd recommend is to tackle debt first. Now, Dave Ramsey talks about putting a $1,000 emergency fund away, but after you do that, instead of just buying more things and getting more debt, it's a wise idea just to go ahead and pay everything off.

One statistic is that the average American lives paycheck to paycheck. We're hoping we can help inspire people to get out of debt and just get out of the rhythm of just living from one paycheck to the next.

One of the things that helped inspire us was a book called The Millionaire Next Door. It talks about how your average millionaire isn't really somebody that you would necessarily think would be the millionaire.

They're people that are your junkyard owners, your garbage truck drivers. They're people who just are wise with their money and save and invest a large portion of what they make. Those are principles that we live by.

Tracking budget and spending

Fast forwarding to today. We have now upgraded both of our cars. We bought used cars in cash. Our house is totally paid for, and we have no debt. We still tithe everything that we make 10% to the local church and no longer use the debit and credit app.

Instead, we use a Google Sheet where we have all of our budgets listed out in categories of household, baby supplies, groceries, personal items, et cetera.

Anytime we spend something, we will add that in the note in the Google Sheet and then tally it up at the end of the month. That way, we know where our money is going and if there's anything that we want to spend above our budget.

5. Credit cards

We do have one credit card. Our first one was to Lowe's, and that was to get the 5% savings to build this house. We were able to save about $500 or so from the $10,000 plus dollars we spent at Lowe's at the time.

Since then, we have gotten a few more credit cards, and it's nice to be able to build our credit while getting some reward points. One of the things that we do to make sure that we don't give the credit cards a penny is we pay off our credit cards once a week.

How to pay off debt

In closing, I think that we're never meant to be tied down to our money. We believe that God wants us to be blessed and have nice things. He just doesn't want those nice things having us.

I think if we stay out of debt and keep our hearts pure and focused on what's most important, we can live a free and fulfilled life that Jesus intended us to have.

I hope our example of how to pay off debt was encouraging for you. I hope that our story and what we have used were an inspiration to you.

How to pay off debt in your 20s

Let us know in the comments below some ways you have used to get out of debt, or if you're still on that journey, how you're trying to live more simply and within your means. We'd love to hear about it.

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2 of 17 comments
  • Tammy Tammy on Dec 27, 2022

    You are absolutely right about the tithing! Glory be to God and he will provide according to His riches and Glory!

  • Emily Emily on Jan 06, 2023

    Impressive. Tithing is giving back praises and glory to God who poured lots of His blessings to us.