Middle-Aged & Too Much Debt? It’s Not Too Late!!

DH = Dear Husband

Our financial situation then

In June of 2012, DH and I woke up to our lousy financial situation. I was 49 years old, and he was 53. We were ostensibly entering our last decade in the work force, but no trajectory towards financial freedom was happening in our numbers.

  • At a time when the national debt-to-income ratio (total debt ÷ total take-home pay) was a record-breaking 163%, ours was over 220%.
  • We were in a pattern of yo-yo debting. We would pay off one debt only to free up room to take on another.
  • We had consumer debt, business debt, and a mortgage.
  • We would not be debt-free within a decade at the rate we were going.
  • We had no emergency fund.

We could count on the pension plan from my work as a teacher, but we had stopped investing anything from DH’s income after the high-tech bust in the early 2000s. My pension and his portfolio would not be enough to finance the debts and expenses we had.

Our financial situation 4½ years later

Tuesday evening of this week, we had a meeting with a financial specialist from Educators Financial Group (and they aren’t sponsoring this post – I just mention it because it’s true). I did not know until this fall that through my work, I have always had access to free financial advice. The financial specialists are paid a salary by the teachers’ union, so they earn the same amount no matter what their clients decide to do.

When Darryl asked for our numbers, here is what we were able to tell him:

  • Our debt-to-income ratio was less than half the national average.
  • We never purchased anything – even big expense items – on credit.
  • We had no consumer debt, no business debt, and our mortgage was down to $95,300.
  • We were on track to be completely debt-free by June of 2019.
  • We had an emergency fund saved (enough to pay our expenses for 3-6 months in the case of loss of income).

Our main question was whether or not we would be in a financial position to allow me to retire in June of 2019 – the date when my age plus my years of work will add up to 85, making me eligible to start receiving my pension. The answer? Yes.

What financial freedom looks like to me

When I explained that I wanted to be free to retire as soon as I became eligible, Darryl assumed I meant that I had had enough of my job. I corrected him. I am actually so grateful for my job.

I work in a wonderful high school. I love my colleagues, and  I love the students. Ours is a very international school, and  every day, I get a peek into the lifestyles of different cultures – with no travel costs. I get to do things that I find meaningful. For instance, just today, I was able to help with an initiative to send books to Inuit communities in the north. And I get to make great connections with people through my work. Again, just today, a graduate who had been in my Jane Austen Book Club came back to visit, and she offered to sew an Austen style dress for me. How nice is that? (Any other Austen fans out there?)

So why do I want to retire as soon as I can? I want to pursue a second career – in writing. It’s been a dream of mine since childhood, and I want to give it an honest shot. I’m not a Superwoman type, and I find it tough to fit in writing after (and sometimes before) a day of work. This past July and August, I didn’t teach summer school or take a course, and I was able to live 2 months of  writing, financially free. It was wonderful! A test drive that convinces me it’s the direction I want to take.

3 types of clients

Darryl said that he had 3 types of clients:

  1. People in a poor financial position who needed a lot of detailed advice.
  2. People in a great financial position who had already achieved what they needed for financial freedom.
  3. People who were on track and headed in the right direction.

If he had visited us 4½ years ago, we would have been clients in the “poor financial position” category. For me, it felt terrific to be considered “on track.” And though I have some regret that we didn’t get our financial act together earlier in life – so that we could be in the “great” category now – I’m more amazed at the difference we have been able to make despite our late start. “The key is to pay off all debt before you retire,” Darryl said to us.

Where to start?

If you are middle-aged and in too much debt, it’s not too late for you to turn things around. But you’ve got to be the one who does the turning. “Where do I even start?” you might ask. I invite you to tune in here at Fruclassity. Read about other people’s experiences in reducing personal debt – and all of the challenges, obstacles, discouragements, and victories that are a part of that effort. Read the 10 Commandments of Fruclassity and decide where change is most needed in your own situation. And then, begin your journey out of debt in the way all journeys start: with one step in the right direction.

Have you ever felt it’s too late to turn your financial situation around? What does financial freedom look like for you? What do you see as your first step in a journey out of debt? Your comments are welcome.


Image courtesy of Pixabay

32 comments on “Middle-Aged & Too Much Debt? It’s Not Too Late!!

  1. I thought you had a flare for writing. Glad to hear that you plan to pursue that passion, and surprisingly have already written three children’s stories. Can’t wait to see what subject you write on once you get serious about it. Glad your debt reduction plan is working out so well because of your diligence. You will be debt free before you know it, and better yet – retired!!

    P.S. – We are still debt free 13 months later 🙂

    1. Thank you so much, Nancy. Looks like Brian wants to see another post about you : ) Some people think that debtors have a hard time staying debt-free once they reach that goal. You are proving that a debtor can change once and for all.

  2. Does that mean we’ll get more posts? 🙂 How satisfying that meeting with Darryl must have been. A confirmation of all of the family’s hard work.

    It’s never too late to begin to get financially fit. Any improvement in someone’s current situation who’s in debt, overspends, etc. will have positive effects for years to come.

    1. Thank you, Brian! It was a very satisfying meeting. I felt so good afterwards. You are right about the positive ripple effects. It’s hard to believe when you’re just starting, but after even a few months, they start to show. And after a few years, even more so.

    1. Hindsight is a beautiful thing, but being proactive for the future is where the power to change is at : ) Thanks so much for reading and commenting, Francesca. I love having an international presence on this blog : ) American, Canadian, and British readers commenting. Will and Kate just visited Canada, and my daughter got to see them. She stepped out of her house in her PJs, and their motorcade drove by. Will rolled down his window to wave at her. She was thrilled!

  3. Ruth, I just got SO excited for you guys as I read this. You really did it, my friend!!! You should be so proud of yourselves. 🙂

    1. Thank you so much, Laurie : ) It’s almost surreal. Such practical, practical steps leading to the freedom to pursue what has never been possible for us before. Look forward to it for yourself and your family! I certainly do : )

  4. That’s great, and having the opportunity to look at the difference made in the long term is great. I think so often we get focused on the day to day, and it can get hard to see progress in such short windows, but now having 4+ years, the difference is huge.

    1. That is true, Money Beagle. The first weeks and months of changed money management are the toughest, and they’re the least likely to convince that things are getting better. If people can just go on faith for a bit, the evidence will surface eventually, and there’s so much encouragement to fuel it onward.

  5. Ruth, it’s great news that you will be able to “retire” in a few years to pursue your writing passion! Your story is so inspirational and motivating, particularly for those who are getting a late start. You’ve successfully proved it can be done!

    1. Thank you, Amanda : ) A neighbour of mine recently said that people who were middle aged and bad with money were “beyond hope”. I think that’s a commonly held assumption, and I’m really happy to prove it wrong!

  6. Congrats on the progress. 4 years seems like an eternity in a world of instant gratification, but it’s awesome that you are sticking and following through with the goals.

    We made the decision to change careers and build a house, which is somewhat counterintuitive to some. We were debt-free and paid rent, but wanted something tangible. Once we payoff our mortgage (hopefully 7 years tops) we will be debt-free again and at least know we won’t owe the landlord a monthly check anymore.

    1. I think your story is great, Josh. Quitting your job, going for a career that paid less but that made you happier . . . Your debt-freedom opened up a better path for you – including the home. According to Dave Ramsey (our guru), a mortgage of 15 years or less is not a bad thing. You’re well within those parameters. A 7-year mortgage is very short.

  7. Congrats on the great news! How awesome to be able to turn it around so quickly by just being diligent about it. And the added bonus of getting to retire when you hit the debt free number too, is amazing! Way to be a great role model!

    It has to be a nice feeling getting to have the time and mind space freed up to concentrate on writing. I hear you about not having much drive for it after a day of work. There are weeks I struggle with putting out a “decent/coherent” blog post, lol.

    1. Thanks so much, Mr. SSC. I don’t see that you have any trouble putting out a decent and coherent blog post : ) I find I often have the “drive” to do blog work after (or before) a day at school, but not the energy. I do look forward to that time and mind space.
      I hope that we hit debt freedom at least a couple of months early so that we can have the experience of getting regular pay but not have to put any of it towards debt. That would be amazing!

  8. It’s so easy for people to get caught up in “I’ve lost too much time and waited too late,” when it comes to retirement or financial freedom. We need stories like yours to remind us that’s just not true. Changing your prioritization, smart strategy, and discipline still make financial independence possible.

  9. I wish I had been more money-savvy when I was in college. Those years seem to have been the worst for me 🙁 I am glad to hear you are in a much better financial position Ruth and also that you will be able to pursue your passion in a few years 🙂

    1. I was absolutely horrible with money in my twenties! I can’t even go there! So you’re not alone, Mackenzie. There is hope for us all : )

  10. Congrats on all your progress! My wife is in grad school so it’s obviously tough to both pay down our debt and not go in further debt due to her program, but I think the first step we needed to take is to just START. Start saving. Start paying down debt. Start investing. Start looking for ways to increase our income. I think if you have a focus on constant improvement you are going to reach your financial goals sooner or later, especially if it’s “get completely out of debt.”

    1. Thanks, DC. Your situation is one that can make it difficult for people to feel encouraged – especially if debt repayment rate is just keeping pace with tuition rate. But I’m sure that you personally have the insight to know that your efforts are setting you up wonderfully for the near future. You wisely chose to “START” when your foundation was just being laid. You will have so much freedom to decide what you’ll build on that foundation : )

  11. I’m so glad the financial specialist was able to validate all the hard work you and DH have done as well as confirm you’re on track to retire in a couple years. It’s an inspiring story to others and proves that it’s not too late to turn your situation around.

    1. Thanks Gary. Some financial advisors encourage investment over debt-repayment, but I think that has a lot to do with the fees they get from their clients’ investments. Since Darrly is paid a salary, I believe his advice is honest – and when he emphasized the importance of debt-repayment before retirement, I really did feel validated.

  12. Congratulations, Ruth!! It’s really wonderful how much you and your family have accomplished in a relatively short time. I’m so pleased that you’ll be able to retire to pursue your passion.

    1. Thank you, Amy! We’re right on track with Ramsey’s statement that it takes the average household 7 years to become completely debt-free.

  13. How encouraging that you were able to make so much progress even with a “late” start. I know so many people who are in a similar position. I’m excited that you can start a second career in writing in just a few years, and I respect your realism about waiting until you are not employed full-time elsewhere.

    1. Thank you, Kalie! I too am amazed at the extent to which we’ve had the power to change our situation for the better. It took a brutal wake-up call, but I’m grateful for it now.

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