From Broke to Financially Woke – The Three Year Experiment


Debt Payoff Stories

Today, I am excited to share with you the latest interview in the From Broke to Financially Woke series!  The purpose of this series it to give hope to those struggling to escape from the not so secret group Broke Phi Broke.  A group whose chant is, “We ain’t got it. Broke, Broke, Phi Broke! We ain’t got it. Broke, Broke, Phi Broke!”

To help me accomplish this goal, I have invited the best and brightest of the financial independence community here to share their stories.  As you read their interviews, pay close attention to the mistakes they made.  Take mental note of the success principles they used to turn things around.

When trying to apply these principles to your own life, realize that success in life is rarely linear.  You will encounter some struggles.  But stay persistent.  Keep moving forward.

Our special guest today is Laurie from The Three Year Experiment.  At her lowest point, she and her husband racked up over $38.000 in consumer debt.

After hearing a report on the radio one day saying that the average American had $10,000 in credit card debt, she decided to change her family’s financial life for the better.

How did she do it?  I’ll let her tell you the story…


Introduce yourself.  Where do you blog? What are some of your interests outside of financial independence?


Debt Payoff Stories


Hi, I’m Laurie, a now-40 year old blogger, mom, teacher, and personal finance aficionada. My blog is called TheThreeYearExperiment, and I blog about how my family engineered our lives to become location independent and financially free. 

Outside of financial stuff, I run (so I don’t kill my family), read trashy books, play tennis (very badly–I’m currently the bottom line of the bottom team in my neighborhood), and travel as much as I possibly can.


Tell us about a time where you were a member of Broke Phi Broke.  How did living paycheck to paycheck make you feel as a person? At your lowest point, how much debt did you have?


My husband (who goes by the moniker Mr. ThreeYear on the blog) and I moved from South America to the US with no debt (no consumer debt–we did have a 15 year mortgage on a Chilean apartment a family member was living in), which is pretty amazing considering he put himself through grad school and I went to an expensive undergrad. We both owe our parents for graduating debt free which is a gift we’d like to give our children as well. 

However, when we moved to Atlanta, we promptly fell into the $40K millionaire trap. We both had entry-level salaries, and were making way more money than we ever had before. As DINKS, we felt rich, so we immediately started to spend, spend, spend. We had a great apartment just miles from both our jobs, but we decided we needed to buy a house. We had two practical, paid-for cars, but we decided we needed newer cars so we took out car loans. And we began going out to eat and charging things on our credit cards, left and right. While we were investing some of our salaries, we were spending way too much, getting into debt, and not saving enough cash.

One of the low points of that time was right after we’d moved into our new house, which we bought at the top of the housing bubble in 2016. I was driving to work, and heard a report on the radio that the average American had $10,000 in credit card debt. I realized that we had MORE than that. I called Mr. ThreeYear from work and told him I thought we needed to pay it off. I remember telling him we’d probably need to cut our discretionary spending back, so he’d “only” get $400 per paycheck in discretionary spending. He pitched a fit! We look back on that memory now and smack our foreheads at how stupid we were. 

Our efforts to pay off our debt didn’t stick, because we weren’t committed and didn’t have a plan. It wasn’t until Mr. ThreeYear was laid off from his job and I picked up a copy of Dave Ramsey’s Total Money Makeover that we got financially woke and really got serious about paying off our debt. 

That was on July 4th, 2008, and when we made the decision to finally get rid of our debt, we owed $38,000 between car loans and credit cards (not counting our mortgage). 

Looking back, living with so much revolving credit card debt made us feel out of control. We realized, after Mr. ThreeYear’s layoff, that we were completely financially dependent on outside forces (i.e., his employer). We didn’t have any self-discipline or self-control around money. We didn’t know how to tell ourselves “no.” Whatever we wanted, we bought. If we didn’t have the money, we thought it was perfectly acceptable to charge it, because we needed it then. We didn’t want to have to wait. 

After we read The Total Money Makeover, we realized that we’d gotten the money rules wrong. We needed to practice delaying gratification. Even though we thought we needed to have the perfectly decorated house, luxury cars, and perfect clothes, that was a myth we’d bought into. 

It took us eighteen months to pay off the $38,000 in consumer debt. I wish I could say we buckled down and changed our ways that day, but the truth is, we made many mistakes, kept eating out, overspent, and overspent our budget many times during those eighteen months. But we still paid off our debt. Small, imperfect steps in the right direction were more important than waiting until we were perfect at budgeting and spending to start. 


What are some of your biggest financial mistakes?


Mr. ThreeYear and I didn’t start out broke, which is the hardest part of our story to swallow. We got into debt by simple overspending and the classic “keeping up with the Joneses” story. 

Over the years, our consistent biggest financial mistake is overspending. I’m a spender, and Mr. ThreeYear grew up poor (more on that below), so we both enjoy spending money. We’ve learned that the artificial spending parameters of a budget are critical for us so that we won’t overspend (too much). 


Describe your upbringing.  Where did you grow up? What did your parents or teachers teach you about money?


My Upbringing


Mr. ThreeYear and I had completely different upbringings. I grew up in the US South, where appearances are very important. I grew up with two well-educated parents in an upper-class home, but we lived in a rural South Carolina town where there was a lot of poverty. I went to public school and grew up with friends from all kinds of financial backgrounds. I had a pretty happy childhood and went to college with no real concept of spending or saving.

When I got to college, though, my parents only sent me a certain amount of money each month: $250. That was pretty generous back in 1997, since they paid for my room, board, and meal plan. But I’d spent a lot of my high school years eating out several times a week with my parents and so I thought that’s what I should do as a college freshman. I quickly overspent my monthly allowance and realized I had to get a job. I got a hostessing job at Outback, and quickly got a credit card. Then, yep, I started overspending on my credit card. It took me one hard summer of working an academic and a waitressing job before I wised up and kept my spending in check. Then, I got interested in investing at the end of my senior year of college and wisely invested all my college graduation money and some of my earnings in a TD Ameritrade account. 


Mr. ThreeYear’s Upbringing


Mr. ThreeYear grew up in Santiago, Chile, in the era of a dictatorship. As a young boy, he had curfews. When he was in high school, the dictator was overturned and Chile once again became a democracy. Economically, though, the country still struggled, and so did Mr. ThreeYear’s family. His dad had died when he was 13, leaving his mom to work three teaching jobs. 

Mr. ThreeYear grew up fixated on every dime of cost. If the electricity bill was too high one month, his mom would panic. There was never enough money. For Christmas, he got socks and underwear, if he got anything at all. 

Reconciling our Upbringings as a Married Couple


Debt Payoff Stories

When Mr. ThreeYear and I married, we had to learn how to reconcile our upbringings. Because he grew up so poor, he was always worried about running out. Because I’d grown up so affluent, I was always worried about wasting. To this day we have a debate about how full the fridge should be–he gets anxious when it’s too empty and I get anxious when it’s too full. 

We’ve talked a lot about our different upbringings and how we’ve taught each other different things about money. Talking about money makes him anxious, so I do all the budgeting and investing. But he’s taught me how to shop for deals and delay gratification. He’s taught me self-discipline around money. I, in turn, have taught him to allow himself to buy stuff that he needs and wants (within the budget, of course) without feeling so guilty.


How important is becoming financially woke to you?  What steps have you taken to increase your financial knowledge?


For us, it’s one of our top three family values (along with friends/family and travel). Becoming financially woke is a daily, lifelong journey. As our life has changed, our financial goals have changed, but we’re constantly learning how to practice values-based spending (spending on the things that matter to us and not overspending on those that don’t). We budget each month, max out our 401Ks, read about budgeting and investing, and I write several personal finance articles per week for the blog.


What are some of the key principles you have used to improve your financial life?


Debt Payoff Stories
Success Principles


BUDGETING: As I mentioned, having a budget to help us plan our expenses and think through our spending has helped a ton.


BUDGETING A MONTH AHEAD: Last August, we finally got a month ahead in our budgeting and it has changed everything. 


DEBT FREEDOM: It actually took us two tries to get out of debt, but now we’re debt free except for our 15-year mortgage. We only pay cash for our purchases, including big purchases like cars. If we don’t have the cash, we don’t buy it.


BANKING OUR RAISES: Every time Mr. ThreeYear gets a raise (because he’s our main income earner), we save or invest it. When we started applying this principle, we were maxing out Mr. ThreeYear’s 401K. Every time he’d get a raise, we’d increase his 401K contribution the same amount, until he was maxed out. Now, every April when he gets his raise, we immediately set an automatic contribution to send that dollar amount to a savings or investing account.


START INVESTING EARLY: This was dumb luck. Because I got interested in investing in college, I knew we needed to start saving early and often. So we both put 25% of our incomes into our retirement accounts when we moved to the US and got jobs. Sure, we were overspending, but we were saving too. I’m so glad we did, because those initial accounts are now worth a large percentage of our net worth.


How often do you consume personal finance information?  Name 3-5 of your favorite sources (books, podcasts, blogs, etc.). 


I’m a personal finance junky! I read PF blogs, articles, etc. almost every day. I’m a big fan of Mr. Tako’s blog. He retired early with kids and is an amazing investor. He’s an amazing cook, too! I want to be him when I grow up.

I devour the New York Times Your Money newsletter every week, and read almost every article there. That “failing” newspaper has done a great job of tapping into the FIRE movement and featuring bloggers and podcasters in their stories about early retirees. 

I actually don’t listen to too many PF podcasts, which may sound strange, but here’s the thing: sometimes in this community we have this weird impulse to do more, hustle more, save more, earn more, create our own companies. When I listen to a lot of PF podcasts, which inevitably feature people who are launching books, or marketing a service, or telling about how they saved a million dollars in two years, I honestly start to feel overwhelmed. I feel bad about myself, start feeling like my life isn’t enough, like I need to do more. But the truth is, I’m living my dream. I don’t need to do more. My family and I are really satisfied and spending and saving our money according to our values. So I skip PF podcasts in favor of Slow Living podcasts, which are more my speed. They help by reminding me to feel gratitude and contentment for my life, just as it is. My favorite slow living podcast is The Slow Home Podcast by Brooke Mcalary. I highly recommend it, because even though it doesn’t specifically talk about personal finance, it helps me with contentment, which helps me spend less and worry less about what others are doing and buying.


Where are you on the path to financial freedom now? 


Debt Payoff Stories


We’re about 9 years away from retirement. If we reduced our spending we could retire by the end of next year but there’s no way we want to do that because of our kids’ ages and stages. By the end of 9 years we’ll be able to very comfortably (FatFIRE) retire.

I don’t know what our retirement will look like, because Little ThreeYear, our youngest, will have just graduated high school and be headed to college. We’ll probably want to stick around our town for him, but we may stop working and take off on some extended holidays. We may eventually sell our house here and downsize or buy another place in Chile so we can live between continents. 


Is there any advice/encouraging words you can give those who are struggling to escape Broke Phi Broke?


We are very imperfect, average members on the road to FI. We aren’t above average in investing or saving/spending. We’re slightly above average on the earning side, but not spectacularly so. But because we have consistently done all three from the beginning (invested, controlled our spending–eventually, and increased our paychecks) we’ve been able to amass a nice net worth. 

We’re constantly learning, making mistakes, overspending, forgetting to rebalance our portfolios. We’re the opposite of the careful, thoughtful engineer types who consistently get better at spending, etc. But despite that, our net worth keeps growing.

If you could just do two things, slowly, over a period of 5-8 years: pay off your debt and max out your 401k, then that could propel you on to a huge net worth down the road. Just focus on getting a little bit better over time.


How can the readers contact you?

I’d love to hear from you! Please reach out at or check out the blog: Thanks so much for reading our story!!


Debt Payoff Stories

Debt Payoff Stories


Read more interviews in the From Broke to Financially Woke Series.

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Author: Jerry

Jerry is a Business Insider Contributing Writer who is obsessed with personal finance. He believes you can improve your financial situation by applying principles taught by the financial independence community to your financial life.

If you are having trouble saving, he recommends that you join the SaverLife Savings program where you can get a $60 reward after six months (no income requirement). All you have to do is put a minimum of $20 a month into a savings account. Easy, right?

For a fun read, check out his article 10 Signs You’re a Personal Finance Addict to see if you are a personal finance nerd.

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