Show notes
Chris and his wife paid off $50,000 in 4 years plus find out if he thinks you should invest or pay off debt first.
Chris Browning is the creator and host of the award-winning, short-form podcast, Popcorn Finance. Each week he discusses finance with amazing guests in about the time it takes to make a bag of popcorn.
Chris holds a bachelor’s degree in Finance with an emphasis in financial planning and still maintains his position as a financial analyst specializing in revenue analysis.
Website: www.PopcornFinance.com
Social: Instagram/Twitter @popcornfinance
Resources mentioned:
Debt Snowball Bundle (https://www.budgetsmadeeasy.com/debt-bundle/)
Dollars and Sense by Dan Ariely (https://amzn.to/35pO2G8)(affiliate link)
Full transcript:
Welcome to the money mindset podcast where you will find the inspiration and motivation you need to manage your money better so you can stress less and live the life you want. I'm Ashley Patrick with budgets made easy and the money mindset podcast. Today we are talking to Chris Browning who is the creator and host of the award winning short form podcast, popcorn of finance. Each week he discusses finance with amazing guests and about the time it takes to make a bag of popcorn. He does hold a bachelor screen finance with an emphasis in financial planning and still maintains his position as a financial analyst specializing in revenue analysis. So today we are going to talk to him about his debt pay off story and also I did want to get his opinion on whether you should invest or pay off debt. And so we will jump into that here in just a minute before we start his interview.
I do want to mention, uh, for you to go get your free debt snowball bundle. This has worksheets and spreadsheets to get started on your debt snowball today. Uh, you can get that for free. A budget's made easy.com/debt-bundle. So go ahead and go grab that to get started on your debt snowball and paying off debt in this new year. And now we will talk to Chris about how he paid off almost $50,000 in about four years. All right. Today we are talking to Chris, the founder of popcorn finance. And today we're going to talk about his debt pay off story, which is pretty neat and how he loves tiny homes. So before we jump in and get started, can you just tell us a little bit about yourself and kind of, you know, about how you started on this journey?
Ah, yeah. Well thanks Ashley. I really appreciate you having me on. And uh, yeah, so about my, my journey, specifically my debt free journey or just the podcast journey in general,
uh, just about yourself in general and then how you started paying off. What, um, kind of motivated you to start paying off your debt.
Oh yeah. So, uh, for, for me, I didn't have a lot of debt growing up, so, you know, right out of college I got a small credit card, but it ended up paying that off relatively quickly, mainly because they wouldn't give me a high limit.
Yeah.
It's all kind of forced me not to be able to go that far into debt. But then when my wife and I, uh, got engaged and we were getting ready for the, uh, the wedding, that's kind of where the debt started to pile up. We didn't really have much saved up. And what ended up happening was when all the bills started rolling in, we had to take on himself. That's really the ourselves and it kind of spiral from there. So it was combination of a wedding. Dad went on a honeymoon, uh, getting into our first place, a behind furniture and some school and medical expenses, all that together, piled up and put us in about $27,000 worth of credit card debt.
Ooh. So did you have like an aha moment that was like the breaking point, you're like, something has got to change.
Yeah. You know, I, I knew that the debt was piling up. I wasn't really tracking it or adding it all up, but one day, I don't know why, I was just like, you know, let me just look at this and see where we're at. And that's what I saw, how high the balances got into, cause it was spread over about three cards. And that's when they kind of hit me. And it was, it was really the stress and anxiety of knowing that I had this huge sum of money that we owed. And at the time I think combined, we're making somewhere between 40 to $50,000 combined. And so our debt was over half of our actual income or our before tax income. So that's when the stress where they set in and I was like, we have to do something about this.
Wow. That. Yeah. That's pretty amazing. So, and you have a degree in finance, right?
Yes. And that made it all worse because I should have known better and I knew what I should be doing. But it's one thing to know and it's a completely different thing to actually implement those, those practices. And those, those, you know, routines in your life that'll help you be a little bit more stable financially.
Well, and it's one of those things that you don't know until, you know, because a lot of people think that they're the only ones that make mistakes or do these types of things. But it's really like everybody, it doesn't matter how much money you make or what kind of job you have, you know, we all make mistakes with our money and you know, almost everybody has dead, at least in America. And you know, it takes usually a big moment to kind of shift your thinking about debt, especially, I mean, even in the finance industry, you know, you know, debt can help you, you know, they say debt can help you start a business and all this stuff, but really it's stress. Um, so even if you have a finance degree, does it mean that you, yeah, I think that you should be debt free or anything like that. So what kind of turns your thinking to just pay it all off instead of say like investing at a higher interest rate or something like that, that you know, some people try and advocate.
Hmm. So for me a lot, most of our debt, I know I would say most of it, all of it was on credit cards and so there's no way I'm going to out earn the interest on the credit card. What I was doing though was I was, I was doing this technique, I don't even know where I heard this ad. Um, it was to, I kept doing these balance transfers and to get the, the 0% promotional interest on credit cards, what I would do is I would have, you know, 0% interest on the car for, you know, 18 months and then pay it down as aggressively as I could. And if I couldn't pay the balance off in full, then I would do a balance transfer to another card. Hey, you know, I think 5% and then, um, take advantage of the 0% transfer for awhile there. So I, that's why I was like, I'm not going to invest this money because I need to just get rid of this debt because if I don't pay it off, the interest is going to be ridiculous.
Yeah, absolutely. So what were some of the things that you did to pay this off fast? Because you guys did it really fast, right?
Yeah, we did it in about two and a half years. Uh, cause there was definitely some setbacks there during that time. But the biggest thing was initially we set up a budget to figure out how much money we actually had coming in and figure how much we could throw towards our debt. And really it was being super aggressive. So pretty much all additional money went towards the debt. I mean, we may be kept, you know, 20, $30 for ourselves every month to do something with. And everything else was just going towards the debt. And, uh, over time I started looking for other ways I could bring in extra money. Uh, I've done several side hustles. I would sell things on eBay. I did food delivery for awhile. Uh, and, but one of the biggest impacts was, um, at my job, I really focused on advancing. So I worked really hard to get additional raises and if I could, if there was no room for growth financially, I ended up changing jobs to a T take advantage of higher salaries at different locations.
Oh, awesome. So did you, um, were you able to like negotiate a higher salary whenever you did that?
Yeah, so every time I had changed, which I'm trying to think time wise, I always forget the time frame when this was going on, but I know I changed jobs at least once. I know what changed. I've changed about two times since the whole debt payoff journey started. I think the second change was I had already, we'd already paid off the debt, but yes, I was able to negotiate much higher salaries, uh, whatever. I changed jobs because at most I was going to be able to get maybe a, you know, three, 4% increase at my current position on an annual basis. Uh, but I was able to increase my salary drastically by changing places where I worked.
Oh, awesome. And was your wife like fully on board with this whole plan as well?
You know, she was, I, I think she, I because that was the one who handles the finances. I did all the budgeting and I would pay the bills. That was my, the thing that I took on. I think I was more, I think I carry more of a stress burden cause I was looking at it all the time. I was overthinking it and constantly worried about it, but she was on board with the change because she, she knew how, how it was impacting me and also how it was impacting our lives over all because so much of our money we needed to go to just keep the debt going and not fall behind and we really couldn't enjoy or the money that we were working so hard for.
[inaudible] um, so you sold things and you got higher paying jobs and um, was there anything else that made like a drastic
Mmm,
improvement on paying this off faster?
Really, it was getting a handle on where our money was going and it's like one of the most boring things you can talk about. And it really was what helped us the most because when I really sat down and we went over our finances and we looked at where our money was going, it was kind of scary how much money we were just going to throw it away and not really noticing. And uh, one thing I always talk about that it's slightly embarrassing, but it's, it's ridiculous. At the same time when I think about it is I went through and I looked at, I think one month we spent like 11 $1,200 on food.
Oh my gosh, that was mine
to $1,200 on food. I was like, this is ridiculous. I was like, how's that even possible? It's like I didn't have any one fancy meal this entire month. I didn't have a steak or lobster or anything considered expensive and yet all this money just flew out the door and it was like, it was a real shock and it ain't going to hit me in the face like, Hey, we need to do a much better job of tracking where this money is going.
Yeah, absolutely. So what kind of mindset changes did you or you know your wife go through from whenever you started to like where you are now? Like how do you think about money differently?
I think it's, it was a lot of focusing on our priorities and shifting our focus from kind of what's going on now, what are, what, what do we want to do right now to what are some goals for the future? And I think it's really hard to shift your focus out so far because it's, it doesn't feel real. It's you, you're so disconnected from it because it's not, it's all right. It's so hard to put yourself in your future self shoes and say, what would I need, you know, five years from now? Or what would I be thinking about my decisions now down the road? And so for us it was really thinking about priorities and what really mattered and were the things that we spent that $1,200 on that important, those bills that great, that memorable that we needed to do that again or it was a better to think about other big goals we had, like getting rid of this debt or maybe buying a house or going on vacations, things that we would actually enjoy and value and remember versus kind of just, you know, not really caring, not really paying attention and letting things continue to kind of fall to the fault of the cracks that kind of blow up on us.
[inaudible] were there any other things that you did to kind of keep yourself motivated since you guys didn't have an extravagant income and your debt was, you know, about half of your income, uh, you know, over the two years. Did you do anything else? Uh, like visuals or you know, little celebrating, small wins or anything like that to kind of help keep you guys motivated?
You know, I'm really sad that I didn't learn about all of the, uh, debt blogs and communities that existed during our journey. I had no idea any of this stuff existed. And so it was a little bit of a lonely journey because I didn't really had, I mean my wife and I, we've talked about it, but you know, you can only sit there and talk about the debt you have for so long before you talk about this anymore. And I didn't talk to any friends or family about it because I was so, I'm down on myself for getting in this position. You kinda, you get embarrassed, you're like, I can't believe I let this get this bad. I can't let my parents know that we did this. So it was a really isolating time and it wasn't until we were almost completely debt free that I found out about some of these communities.
Yeah. Specifically, I hang out a lot on Instagram and like the hashtag every community there and things like that that are really motivational and I really wish I would've known about those things. I think the best thing that I had for, for feeling better about being on bed where the, the little milestones where we would pay off a credit card. So it was spread around about three cards. So every time we paid off one of those cards, that was like a motivational boost. It was like, Oh man, we're actually making progress. And so I would, um, I used mint.com to track everything and I would always look at the balance and it would feel great when I would see the balance drop. And then specifically when one of the cars would fall off, I'm like, Oh yes, we're making some type of progress. This is actually mattering.
Yes, exactly. Uh, so did you use the debt snowball or did you use a different method?
Yeah, I use the, let me think back. I use the avalanche method because that's what is built into mint. So what it does is that you put in all your details and then it just basically organizes your payments based off of interest rate. That's the method that we ended up going with. And it [inaudible] it kind of ended up being almost the same as the snowball because the demo, it was pretty evenly spread across three cards. So, and the interest rates were relatively the same across the cards as well. So I don't think it would've made much of a difference either method for us at the time.
Right, right. Um, so let's see. Now, if people are in your situation and they are wondering if they should save money, invest or pay off their debt, what do you typically tell people? Cause you know, you're in financial planning, so you know, I'm sure investing is, um, really important to you as it is to all of us. I mean, you know, compound interest is amazing. So what do you tell somebody that if they're, if it's going to take them a couple of years to pay off their debt, which would you recommend for them?
Oh, this is always a really tough decision because there's a lot to think about. One of the best I think responses to this question I've ever heard was um, Erin Lowry, she, um, she wrote a book called Brooklyn lineal takes on investing and she said she spoke to a lot of different financial planners and professionals and one of the pieces of advice she got regarding that issue is you need to kind of look at the interest rates, all your debt versus on what you could be potentially earning by investing that money. And so specifically I think there's a big focus on like student loan debt, which I mean so many people have right now, but it's, it's a comparison of if you're, if you're, um, if you're paying, let's say roughly more than 5% interest on your debt, then it's probably a better idea to focus on that than trying to invest because you can't, it's kind of hard to find a guaranteed return greater than 6%.
Cause especially cause the market fluctuates up and down and you don't know what you're going to get. And on average it's going to be slightly higher than that. So it's better to focus on paying off your debt and getting that down than to worry about investing. Because in the long run you're going to save yourself more money by getting rid of this debt, the interest you're paying on this debt. All right, so it really depends on what you're looking at. I mean this definitely, if you have credit cards and you're paying interest and your interest rate is like 15 to 25% focus on the debt, you got to get rid of that because there's no way you're going out or that in any type of investment or at least there's no way you can guarantee out earning that and then where they need type of investment.
So for sure, I would say if you have any type of high interest debt, you want to focus on that. Um, but I would still say, put a little bit aside, I mean obviously you can't max out your retirement plan, but most people can't max out your retirement plans and pay off huge sums of debt all at the same time. It can be a little difficult, can be a little hard on cash floated to be able to attain that. But I would still say to put something aside, so whether it is, you know, $50, $100 a month, putting away something so at least you can take advantage of the compound interest and at least start building something up, whether it is an emergency fund or starting to put money into a retirement plan. Uh, but I think you should definitely make your focus getting rid of that high interest in.
Absolutely. Um, so how much money did you pay off and how fast did you end up doing it?
So I actually have like a little bit of an update to it. So we are credit card debt alone. That took us about two and a half years. So it was $27,000 in credit card debt. Uh, we started that in late, I'd say late twenties, try to think of the late 2014 and then we ended up paying it off the very beginning of 2017 and then after that we actually ended up focusing on paying off my wife's car. And so we ended up paying that off, I think about, uh, a year, about a year later. So in total, cause we ha we actually, we actually got her car right at the same time. We realize how much debt we had. So that was just like piling on top of it. So that was about $23,000. So in total we pay it off about $50,000 in I think roughly four, four and a half years, somewhere around there.
That's awesome. That's amazing. I know that you love tiny homes cause I follow you on Instagram. So you know, I just, do you live in a tiny home? Like do you want to live in a tiny home?
No, I actually do not live in a tiny home. So I live, I live in Southern California. It's not really something that's easily, easily accessible here. But those laws are, or they're changing, but as it stands, you cannot build a tiny home. Like, no, you're not doing that. You've got to put a bigger house and we get more property tax money.
Yeah, exactly.
So they're not letting us do that. But I do love tiny homes and, uh, I got the opportunity to stay in one in Phoenix, Arizona. It was the first time I ever stayed in a tiny home and I loved the experience. It was amazing. I think what I love about it is one, they're designed beautifully. They make great use of this space. They somehow make it feel bigger than what it really is. A tiny house can range anywhere from like, you know, 150, 170 feet all the way up to, you know, low 400. I think most people think a tiny home is under 500 square feet. It's like what's considered standard for a tiny home. But they do such a great job and I think it also promotes, um, more intentional living and definitely more intentional spending because you only have so much room. And it kind of forces you to become a, because you have to utilize your space. You want to just pilot to the ceiling with the junk. For all those reasons. I, I really love tiny homes. I have no idea where this came from. Like this love for tiny homes, game pro. But it's just something that I've just grown to appreciate more and more.
Yeah. I've seen it on Instagram. I was like, I just have to ask him about this tiny home thing.
I mean, they're, they're amazing. I really wish they would be more accessible here at this point. I would need, I need one for podcasting and then E one for living because there was no rooms really. I mean, some of them have rooms, but for the most part there's no rooms in a tiny Hill. If you're, if you're a one spot, you can hear whoever else.
Right? Yeah. It wouldn't be good for this sound. Um, all right. Now I always like to ask people what they're feeling. Favorite nonfiction book is, you know, because most millionaires read like some of them, like a book a month. Um, and so I like to get other ideas and inspiration on ways to improve, you know, yourself and your finances and things like that. So it doesn't have to be finance related. Just anything that you know is your favorite nonfiction book?
Oh, that's a great question. I think my favorite nonfiction book would have to be a dollars and cents by Dan Arielli. So he is, um, he's a brilliant, brilliant mind. This is kind of like a, Hmm. Like a macro economics. [inaudible] excuse me. No, I messed that up. It's not macroeconomy it's behavioral economics, a book. Basically it's looking at how we interact with our financial decisions and why we make the decisions we make. And it's really fascinating. I, I somehow also become fascinated with economics. I just love the study of looking at how our financial system works and how we interact with money and how it overall impacts everything that's going on. And behavioral economics really brings in like the psychological aspect of it. And so it's a really cool look at all of these different aspects. So it's like, you know, how do, how do, um, how does pricing things for free or for rental prices impact our spending behaviors or the way that things are marketed or the way that we make financial decisions and I organize things. It's a really cool, like it can be a little dense with the numbers sometimes, but I think for a behavior economics book is actually written very well. I, and I think it's, it's really enjoyable. It's something, a cool way to look at our finances in a completely different light than I think we do for the most part.
Oh well I'll have to check that out cause I'm fascinated by that as well. So I will add that to my reading list. And do you have any last words of wisdom? Last pieces of advice?
I would say something I've been trying to focus on lately is giving myself more grace when it comes to the mistakes that I make financially. I think it can be really easy to get into the trap of focusing on all the things that you're doing wrong and seeing everyone else, it feels like everyone else is doing right. I think that's the trap that we fall into. You look around, you see people doing all these amazing things and making, hitting these milestones in their lives, and you feel like, Oh, why am I not there? Why am I not doing this? Or if I would've done this differently, where would I be? Now? It's, it's really easy to fall down that spiral of really getting down on yourself and feeling you know, horrible about the decisions you've made. And I think it's really important to give yourself grace for the mistakes that you've made because even though things may look great for other people, everyone's making mistakes.
Everyone has done things that they wish they would not have done. You just can't see it. They're not going to, they're going to walk around telling you all the things they regret. So I think it's really important, especially while you're on your, your debt repayment journey is to just give yourself some grace. And even something I wish I would've done is to allow myself maybe a little bit more money to enjoy myself and to keep my spirits up. I mean, I'm not saying, you know, spent, you know, half your income to make yourself feel better, but finding something I really, truly enjoy that's not going to, you know, destroy your budget and allowing yourself that, that, that break, that, that enjoyment. So that way you can keep the journey going because it's so hard to stay consistent and to keep, you know, seeing your paycheck go away every, every time you get paid to take care of your debt. So to give yourself a little bit of grace, uh, you know, celebrate the small wins and you know, not be so hard on yourself for maybe getting into debt or making a mistake because we all do it and you can definitely overcome it. It just, you know, just takes a little bit of time.
Absolutely. That is great advice. And where can people find you? They want to follow you. Find out more about you.
Oh yeah, you can find me [email protected] or where you're listening to this podcast here. You just saw just section five point finance and you can find me there. And I also hang out on Instagram a lot. So you just look for about for finance. I always post different things on their updates on the show or even a bunch of pictures of [inaudible].
Yeah, go follow him on Instagram. What does he wear? I wish I lived. All right. Well thanks for coming today.
I know, I really appreciate it. Ashley. Thanks for having me on.
Thanks. Thank you so much. Shucker Serbian on with us today and talking about his debt free journey. Uh, also don't forget, before you go to go get your free debt snowball, uh, bundle you with worksheets and spreadsheet and everything to get started on your debt snowball, it is free. Go to budgets made easy.com/debt-bundle and you can sign up and get it there for free. I will talk to you guys next week.
Special Guest: Chris Bowning.