Creative Twist on Debt Freedom Revisited

Aja McClanahan was a guest on the Midday Money Show in 2014, shortly after she and her husband, Kelvin, paid off their final debt and celebrated a new found debt freedom. They’ve been included as a New Year New You 2015 profile because thinking outside of the box to achieve debt freedom is a great source of inspiration for others.

Oh yeah…paying off $110,000 in debt is another great reason to include them too!

We often celebrate debt freedom – whether or not a person includes the mortgage (consumer debt alone is just fine). The McClanahan’s are debt free and live in a paid for home! That led to the creative twist in her debt free story.

At a time when most people – who can – understandably move away from blighted communities overrun with the social ills common to inner cities (gangs, drugs, shootings, poor schools, etc.), this couple moved in. They grabbed their debt free piece of the American dream. As residents of Englewood – a low-income, Chicago community that’s frequently highlighted on the nightly news for all the wrong reasons – Aja and her husband have embraced a ‘Hood Rich mantra.

 

‘Hood Rich – it’s not what you think. It’s so much more!

I highly recommend you take in her story from the original interview. She’s extremely wise for her young years. Her spiritual life featured greatly in her journey out of debt and decision to take her family into the proverbial lion’s den.

Following the interview, she updated us with thoughts on life after debt freedom that are equally helpful to know. You can always drop by to learn more about Aja, her neighborhood, and her journey to debt freedom on her blog Principles of Increase.

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1. What’s life like now that you are debt free? Since we’ve been behind in retirement savings, we haven’t had much chance to splurge. However, we’ve had more leeway than ever. For instance, I had a small budget to make over my dining room. And though we had the money to buy a new table and chairs, I opted to makeover my old set (which actually turned out so fabulous, I am quite glad I did it!). I do feel like we have more peace of mind. If I need to take time away from my business for any reason: health, kids, sanity, etc. I actually can. There are no looming financial responsibilities. We are also freer to dream and explore some of the “pie in the sky” things we always talked about. Kelvin wants to explore real-estate investing and I have a whole slew of things that interest me that I won’t go into here. But suffice it to say, we have more wiggle room to rest and dream as needed.

2. Do you ever see your family purchasing another house in a different neighborhood? Would you approach securing a new house in the same manner? Currently, I am incredibly content where we live. The sense of community here is amazing. It’s like nothing I’ve ever experienced in the suburbs. I guess I’m just naturally attracted to tough things. If someone says, “You can’t do that, you can’t live there!”, it makes me want to do it all the more. Instead of living somewhere where everything is served on platter, we are some place where we have to literally build the neighborhood we desire. So far we’ve seem liquor stores closed, drug spots obliterated, new restaurants and grocery stores and better schools open up. I really don’t have a desire to leave here. That may change, but I wouldn’t be upset if we lived the rest of our days in Englewood. We actually do have a vision to own real estate in other states and countries. Anything we would acquire, would also have to be debt free. We are not going back to debt!

3. What strategies to do you employ to ensure you don’t end up back in debt? It’s been hard. The temptation is there to go back because of some opportunity you think you will never have again. I read a quote that said something to the tune of basing your life on principles so that when you encounter decisions they are already made. The foundation of our financial philosophy is based in Biblical best practices. One of those best practices is staying out of debt. We’ve already resolved to take that position. So when we get the credit card offers in the mail, it is easy to rip them up. We had already decided “no” before they came to us. It helps us when we encounter new situations. Even the ones where debt is a little more subtle. For example, we had the option to upgrade our phones over a period of time with a payment plan. It seems harmless, but when we thought through scenarios about what could go wrong, we figured out that if the phones got lost or stolen, we’d still have to make payments. That sounded like debt to us! So we also had to decline. So again, having a mutually agreed upon principle helps us in staying out of debt.

4. What are some things you can do as a debt free household that were difficult or impossible before?  Where should we start? I am home schooling my kids this year. This would not be possible if we needed to have 2 incomes to sustain our household, but we don’t. My girls are in acting, modeling, singing and play multiple instruments. I have time to cart them back and forth to related activities and lessons. We will be spending time on the West Coast this year so they can be considered for more TV and film roles. I hear of parents who go to LA for pilot season and go into so much debt. They take 2nd mortgages on their homes and rack up so much credit card debt the whole thing ceases to be fun for anyone any more. The child is burdened with the task of booking work because the entire household’s financial well being is literally on their shoulders. I don’t want that pressure on me or my kids. We’ll go with the intent to have fun and be more relaxed because we have the financial wherewithal to do so. It’s such a blessing! Other pluses are that we are getting caught up on emergency fund and retirement savings.

Find more New Year New You 2015 profiles and be inspired! Each of the people profiled made a decision one day to make a change. Are you ready?

Hood Rich

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