Steve and Jennie Silha.
Steve and Jennie Silha
Steve and Jennie Silha got into debt like many young couples: they had children.
Steve, 44, is a realist and says the problem was quite simple.
“It really came down to the fact that we decided my wife would be a stay-at-home mom, but we spent like we had two incomes,” he said.
And after 15 years of raising two children, the Chicago-area couple found themselves last year with $47,000 in unsecured debt — mostly credit card debt. That’s when they committed to making a change.
“I would say it was superficial irresponsibility. We just made some really bad decisions over the last 10 years,” Steve said. “We decided to ‘grow up’ and take on the debt.”
It was the first step. The second step involved Steve accepting a new job with a higher salary. It helped a bit. The third step involved changes in how the family spends their money.
“We cook more at home and haven’t taken vacations like we usually do,” Steve said.
But the biggest step of all was Jennie, 43, deciding to get back into the workforce. With a 15 year old son and an 11 year old daughter, the time had come. She started this month.
The couple have pledged that 100% of the income from their work in home care will be used to reduce their debt.
So far they’ve paid around $7,000.
New austerity measures haven’t left the family wanting more fun. Instead, their renewed commitment to paying off debt is a challenge that has been good for their relationship, Steve said.
“Since June, we’ve changed our lives dramatically – in so many ways. Getting our finances in order is one of the biggest ways we’re changing everything. It feels good. Paying off the first (credit) card was amazing,” he said.
The turning point came when the couple discussed filing for bankruptcy last year, Steve said. They had tried another debt-reduction plan four years ago, but didn’t stick to it because they “hadn’t hit rock bottom yet”, he said.
“I think that’s where we said, man, either we’re going to destroy our personal financial lives or we’re going to settle this once and for all,” he said.
The Silhas (not pictured) are focused on increasing their income and reducing their expenses at the same time.
Sean Gallup/Getty Images
The key to success this time will be to both increase their income and reduce their expenses, he said. Doing only one or the other “is like trying to
losing weight
without reducing your calorie intake and without training to burn more,” he said. In addition to their new jobs, Steve and Jennie have side jobs where they earn a little extra income. All this will also be used to pay the debt.
Steve hopes the positive changes will help his children learn to spend wisely and invest for the future.
“I talk to my kids every week — if not every day — about the dangers of personal debt,” he said. “While I hope they listen, I know the most powerful thing will be watching Jennie and I pull us out of this pit.”
There is a long way to go. Currently, Steve and his wife are hoping that their increased income will allow them to be debt free within two years. But that will require sticking to the plan. Steve says he’s ready.
“I believe a big part of doing this…and everything else…is having the right attitude,” he said. “We finally decided we had enough and were going to tackle this debt with passion…we both do it as a team…it brought us closer together. Without a doubt.”
Having a high percentage of credit card debt against your credit limits can negatively impact your credit scores. The weaker your credit, the more you tend to pay on interest rates which can cost you a lot more money over time. As you pay down your debt and build your credit, it can be helpful to track your progress. You can do this by getting your free credit scores, which you can do every 30 days on Credit.com.
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