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April 1 & 2, 2017

The Debt Free Guys: "If You Cannot Afford to Enjoy the Big Things in Life, Enjoy the Small Things"

David Auten and John Schneider, known as the "Debt Free Guys," had been together for more than a year when they came to a startling realization: Together, they had $51,000 in credit card debt. The irony? Both worked in financial services and spent their days informing others how to manage money.

After coming clean to one another, they resolved to change their habits, setting clear goals, outlining steps to achieve them and making a commitment to become debt free. Today, they happily and comfortably live in the black and use their personal experiences and professional wisdom to help others in the LGBT community do the same. Below, Capital One caught up with the duo to hear more about their story.

Let’s go back to the beginning: How did that first awkward conversation about your individual debts come up?
David: One weekend we went up to Winter Park, Colorado to visit a friend of John's. We were really enjoying the lifestyle there, so we had this fantasy of looking at property on our way out of town. But our conversation quickly started to change to the reality that maybe we couldn't afford to buy a place up there. It was at that point that John and I confessed to each other where we were financially. We realized that we had $51,000 in credit card debt, and we were living a very mediocre life.

John: While we enjoyed expensive happy hours and fancy dinners, at the end of the day those weren't really the things that we wanted. It was only when we realized that one of the things we actually wanted in life we couldn't do, then we started to have that discussion.

If you could go back right now and give your younger selves one piece of advice, what would it be?
David: Buying on credit anchors your future earnings to your past. I wish I had figured that out. I never really understood that when you buy on credit, you're taking away your future potential. Whether that's the potential to invest, or get what you want in the future. You need to weigh the opportunity cost. Second, if you can’t afford to enjoy the big things in life, enjoy the small things. But if you enjoy the small things in life too much, you will never get to enjoy the big things.

John: I went to school for exercise physiology, and I knew that every calorie in and every calorie out had an affect on you. So I understood the value of money in, money out, but I didn't really apply that to my life. I didn't understand how credit cards would affect that equation—nobody really had this discussion with me. But at the end of the day, I was an adult when I got my first credit card, and it was my responsibility. I should have researched and understood how to use that tool, as you should with any financial tool.

Now that you mention it, the educational component is a big part of what the Capital One Banking Reimagined Tour is trying to do—inform consumers about their personal finances, help them set goals that align with their values and assist with planning for the future.
John: We love that Capital One is trying to meet people where they want to be met. We do think that personal finance is still a taboo subject—something people are afraid of. I think creating an interactive, tech-savvy, personal way for people to start talking about money is beneficial, for no other reason than it gets the conversation started.

Absolutely—and it’s taboo partially because personal finance is so, well, personal. There’s no one-size-fits-all approach to banking.
David: One of the other things John and I recognized, especially when we would hang out with our group of friends, was that there was a broad dichotomy in the amount of money people were earning. We had friends who were doctors and lawyers, and friends who were hairstylists or worked at the mall. But everyone in our group seemed to be spending in a similar manner. Once we realized where we were in that spectrum, and where our debt was, we thought, "There are a lot of other people out there who are just like us. They need the help just like we needed help."

And from there, the Debt Free Guys were born?
John: When we paid off our debt, we thought: "We have all of this theoretical and practical knowledge, and professional and personal experience. Maybe what we need to do is write a book to tell people what we did to get out of debt, and the principals that we're using to stay out of debt." We knew that the problem was bigger than just our two personal financial situations. We wrote a book called The Four Principles of a Debt Free Life and we built our platform. Initially we started out as Debt Free Principles, but we decided to make it more personal and became the Debt Free Guys.

So what’s next for you?
John: One of the things that David and I have been trying to do is figure out a way that we can start connecting with our community sooner so that we can be more proactive—so they don't have to get to that rock bottom level of debt. The sooner you start that, the easier it is.

To participate in the Capital One Banking Reimagined Tour and to learn more about improving your relationship with money, visit bankingreimagined.capitalone.com

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