How One Couple Wiped Out a $125,000 Debt

  • By Quentin Fottrell, Marketwatch
  • July 24, 2014

paid off $125,00 debt

What do you do when you are faced with a six-figure debt — mostly because of credit cards? No cable television and no eating out, obviously. And that’s just for starters. Two weeks before Christmas of 2004, Kandy Hildebrandt opened a letter addressed to her husband, Russ, at his request. The letter revealed that her husband had a personal loan of $17,500. They sat down to talk about it: Russ also had 11 credit cards totaling $89,000 in debt. “He handled the personal finances,” she says. “I knew we had several credit cards, but I was unaware of the extent of our debt.”

The finance charges on the credit cards alone were $1,593 a month — double their $750 monthly rent in New Richmond, Wis. The Hildebrandts knew they needed to change their lives. But unlike many people in their situation, they actually did.

Kandy, 48, and Russ, 52, celebrated a fifth anniversary of freedom from debt this week. They made their first payment on their debt-management plan in March 2005 and their last payment on June 24, 2009. “After paying everything off, with interest, we paid over $125,000,” she says.

Although they were in big trouble financially, Russ kept a promise after their twins girls were born in 1994 that Kandy would not have to go back to work outside the home. And, to his credit, she didn’t. But they took some unusual steps. “We acknowledged that we were in deep water and needed to seek help,” she says. The only debt they have now is a mortgage: They bought a home in April 2009.

Kandy Hildebrandt tells MarketWatch about their road to financial Wellville:

MarketWatch: Last night, you had a big celebration.
Hildebrandt: We had dinner out.

Where did you go?
It’s not too extravagant, but it’s what we like: Pizza Ranch. We’re not debt-free, as we still have a mortgage. But we’ve had no unsecured debt since we paid it off.

How did you rack up so much debt?
It was really easy. It occurred after about 15 years of living a little beyond our means every month. In 1994, I came home from a part-time job to start a family. We didn’t make the corrections we needed to financially to accommodate a drop in income. We had identical twins nine months later. That meant two of everything.

And you had no clue?
I knew [Russ] had debt, but I didn’t know to what extent. I saw him becoming increasingly stressed and anxious. Before I left the workforce outside of my home, I was actually in the credit-card industry. I worked for a major retailer [J.C. Penney] in the credit-card division as a supervisor. I was aware of how the system works. We got a letter from one of those credit cards earlier in 2004 saying they were going to increase their rates because of our debt-to-income ratio. After we got the letter about the personal loan, I picked the right moment to address it with my husband.

What was that moment like?
He didn’t want to face the figure on paper, so I was gracious and told him. Thankfully, with my credit background with J.C. Penney, I was aware of the Consumer Credit Counseling Service. I knew we needed to seek outside help. There happened to be one in Stillwater, about 15 miles from our home, and half a block from our bank. We needed to seek help and cease charging.

And now for the $106,000 question: How did you clear it?
At night, Russ, who’s a chemist, picked up a job after work, sweeping and mopping floors at the local grocery store and cleaning the bathrooms. His first shift was midnight to 4 a.m.; his shift changed over the years, but he did that for four years straight.

That must have been rough.
He slept in his vehicle at night to save on gas, so we would have the money we needed for food. That included the wintertime, and the winters [here] can get pretty harsh. A lot of that was determined by how the gas prices were rising. He would work late and sleep in the car, go to his day job, shower and be there before everyone came back. Nobody knew he was doing it. He did it off and on for the last 2 ½ years of the debt-management plan. Our son came along halfway through that plan. We were overjoyed.

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