Our road to financial freedom

Debt isn’t something that happens overnight. My wife of 20 years and I watched it accumulate for years before we were forced to take action.

It’s hard to look back at what we went through, but knowing how far we’ve come inspires us to share our story to help prevent others from going through what our family did.

Flashback to 2002: We had a great life with five children, a nice home, fancy vehicles and a cabin on the lake. I was working in the mortgage industry, and the housing market was booming! While I was making a lot of money, we were carelessly spending and putting every- thing on credit. We weren’t prepared for the housing industry to go south, which is exactly what happened.

The real estate bubble popped. At the end of 2007, people could no longer refinance, housing prices dropped and I wasn’t getting any new business. All 22 of my employees had moved on to different careers. By the end of 2008, my take-home pay had dropped by 75%.

We ended up having to short-sale our home, sell our cabin and begin renting.

We sold our expensive vehicles and bought much older cars with cash.

Sacrificing, collaborating

My wife and I had never experienced this kind of stress in our lives. We were always able to pay our bills, but now our phone was ringing off the hook with creditors wanting to get paid.

We knew we couldn’t ignore our debt any longer; there had to be a better way.

We understood money issues are one of the leading causes of divorce, but in our experience, our marriage came out stronger because we were on the same team and both knew the lifestyle we wanted to achieve.

Getting out of debt is challenging and you have to make sacrifices. Our family cut out the extras, and my wife and I talked through all purchases. We understood this was necessary to hold each other accountable.

After getting a paycheck, I would go to the bank, get cash and put the money in designated envelopes — rent, utilities, groceries. If we didn’t have the cash to pay for something, we didn’t buy it. While we were going through these tough times, there were constant reminders of how we got ourselves into this situation, which motivated us to keep going.

Talking to the kids

Throughout our journey of becoming debt-free, our family was changing and growing. Our two oldest children had grad- uated and moved out, and we had five younger children at home. In the spring of 2013, the year we paid off most of the debt, our twins were born.

Our older children were definitely more aware of their surroundings and situations, but we didn’t talk about our debt with our younger children. We didn’t want to add more stress to their lives; this wasn’t their burden to carry.

Speaking from experience

Debt is a humbling experience. Not only were we figuring out our finances, but I was also making a career change.

In fact, I was working to become a financial advisor. Today, when someone comes into my office who has experienced a job loss, illness or loss of a spouse, I can coach them through that situation because I’ve also experienced hardships and came out on the other side a better person.

I also know how to negotiate debt because I’ve experienced it myself. I don’t recommend filing for bankruptcy and consider it the easy way out. In the end, you won’t learn anything or change your habits.

My family of 11 — we have nine children now — wouldn’t be where we are today if we didn’t take a stance against debt. Now that our debt has been eliminated, I can help others.

Getting out of debt allows for more freedom to have special experiences and create those memories we all want. In the end, experiences with our family and friends are what makes us happy.


Mike Kojonen specializes in helping pre-retirees/retirees with retirement planning. He’s the founder/owner of Principal Preservation Services, a Minnesota and Wisconsin insurance agency. Learn more at principalpreservationservices.com.