Debt-Free And High On Saving - personal finance case study - Brief Article

Kiplinger's Personal Finance Magazine, March, 2001

Paul and Cheryl Jakubowski kicked a 20-card CREDIT HABIT cold turkey.

Names: Paul Jakubowski, 49, and Cheryl Jakubowski, 47, Cincinnati.

Achievement: Paid off $35,000 in credit card debt over two years, and went from 20 cards down to two--on which they never carry a balance.

Sign of success: Saw their net worth soar to $1.3 million as of December 31.

How they did it: Focused on paying off one card at a time, starting with smaller balances; stuck to a strict budget, splitting a weekly allowance of $150. With their extra cash, they funded IRAs. Now Paul maxes out his 401(k) plan with Procter & Gamble, and invests in stocks, bonds and mutual funds.

Sources of help: Software to track their finances, and periodic advice via e-mail from financial author Andrew Tobias.

Lesson learned: "Assume you can live on $100 less than you make instead of $100 more," says Paul.

Next goal: Figure out how much is enough to retire on.