How We Live Debt Free. And Avoid The Man.

How To Live Debt Free

This is intended for anyone who is deeply in debt, unhappy with their current financial situation, and interested in debt-free living.
How To Live Debt Free

We’re debt-free. And we’ve lived this way for years.

While ‘we’ means my husband and I, I’ll tell this from my perspective since I was on my own for a number of years before I met him. It has not always been easy. We have faced a lot of struggles. But it remains completely worthwhile.

Drowning in debt?

Many stories of debt-free living seem to start with We were over our heads in credit card debt and loans and were about to lose our home and cars and more and then we heard about Dave Ramsey or Gail Vaz-Oxlade or ____________ and turned our lives around.

My story is different. I’ve certainly been flat broke in years gone by, living pay cheque to pay cheque in my university years, but I’ve always feared the crippling power of debt more than a hungry belly and second hand clothes. In fact, faced with the prospect of borrowing a lot of money to complete my degree, I dropped out instead knowing my potential careers would never justify the expenditure.

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Even through very lean times, I have avoided debt like the plague. More often than not this has meant doing without when everyone around me seemed to be going on trips, buying new clothes and electronics and flotsam, and updating cars, and moving into mega-houses.

While some can truly afford these things, many of us cannot and instad we pay for them on credit. I’ve never been able to take that plunge, no matter how enticing the item seemed. The thought of carrying that credit card balance with an enormous interest rate is just too stressful to me. Thankfully, my husband feels the same way.

And because we’ve always lived fairly conservatively where money is concerned, the highs and lows of the economy don’t really affect us much. We always just stay within our means, ready for whatever life next tosses our way.


We are self-employed which means income can seriously fluctuate and there can be long  periods of time between payments so a safety net is essential. But in today’s job world, every position comes without long-term guarantees and it’s probably wise for everyone to get ahead in savings to provide a smoother transition should a job be lost.

I know there are a lot of situations where people are totally broadsided by circumstance and engage in debt as a means of survival. But there’s also a lot of people who live beyond their means now, thinking they can pay later, accruing more debt than they could possibly pay off in a lifetime, seemingly ignorant of the basic math. Those are the ones who scare me. Because at some point overwhelming debt shifts from a personal problem to a communal problem. How can you take care of yourself and your family when the debts finally catch up with you and you’ve lost everything? How can you possibly pay off a maxed-out credit card when you never go beyond the minimum payment? At some point you’ll have to deal with it or your heirs will.

Some of you will find my methods far too conservative. Others will declare it fear-based and not ‘spiritual’ enough (i.e. ‘have faith and things will work out!’). Others will think there’s just not enough fun in it. But for me, there’s so much that life can throw at you that I truly take comfort in controlling the things I can, and having resources to fall back on when the shit next hits the fan. Knowing we’re taking care of yourselves, now and in emergencies, is financial love to me. And actually fun.

Here’s my Empress of Dirt Principles of Debt-Free Living

  1. Be trustworthy to yourself and others. In other words, where money is concerned, be honest with yourself and your partner about every dollar you spend.
  2. Earn more than you spend and have a basic plan. Example: 30% home, 50% food, clothing, fun, 20% savings.
  3. Pay no interest or bank fees. A realistic mortgage is an exception (see #7).
  4. Track every single financial transaction. Always and forever more.
  5. Know your numbers: how much everything costs and exactly how much you spend in each category.
  6. Use credit cards and debit cards as tools for planned spending and only within your budget. Pay all balances off in full each month.
  7. Have no loans other than a mortgage for a home. That mortgage cannot be for more than 2.5 times your annual net income. For example, if your household net income is $85,000 a year, your maximum mortgage must not exceed $212,500. The older you are, the lower this amount has to be.
  8. Monthly rent or mortgage plus utilities and property taxes cannot exceed 30% of your net income. You might be able to convince me 40% is ok.
  9. Budget for fun, whether it’s travel, goods, or services. Save up the cash needed before indulging.

How do you know if you can afford something?

You have to get your ducks in a row first. Then there’s plenty of room for fun.

If you have doubts about buying something, just don’t do it. The easiest way out is to ask yourself, Can I live without this? And the truthful answer is almost always yes.

Here’s my Test of Affordability

You can afford to buy that Whatever you’ve been longing for if:

  • You are following all of the principles of debt-free living listed above.
  • You have six months’ living expenses in the bank to fall back on in the event of an unexpected catastrophe.
  • You have zero personal debt other than a reasonable mortgage.
  • Your family has sufficient health insurance.
  • Your family visits the dentist regularly.
  • You have life insurance.
  • You have legal wills.
  • Income is steady.
  • Retirement savings are on track.
  • The desired item fits within the plan your family has for your life/lives.
  • You have the cash saved up specifically for it.

Kind of sobering, I know. But it works for us. If you’re in over your head or wasting a lot of money to fill a void, it’s never too late to turn things around. Plus, it’s amazing how many purchases lose their appeal if you make yourself wait 30 days or more before going ahead. Or googling “Great Pacific Garbage Patch”.

Amazing but true

Life becomes incredibly calm when you stop emotional shopping (free yourself from The Man), take true control of and responsibility for your finances, establish a secure financial base, and plan your indulgences based on what you really want from life. Take away all the unnecessary daily consumption and you’ll probably find out you have a lot of money available for what really matters the most.



  1. Kathy riley says

    I suppose I am middle of the road frugal,when I use my cred card i pay it off when the bill comes, we almost own our home, I usually shop thrift stores and G-sales,
    I know i havn’t saved enough tho. I intend to work more at that .I feel enthused about saving after reading your post. I have Joy feeding the birds and the feral cats so i still spend money on those things and will as long as i can. Love your site.

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