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A couple paid off $125,000 of debt in 2 years after moving into a 200-square-foot tiny house — here's how they did it

A couple paid off $125,000 of debt in 2 years after moving into a 200-square-foot tiny house — here's how they did it
  • Marek and Ko Bush decided to move into a tiny house to pay off their debt.
  • They sold their furniture so they could downsize, and they secured a low-interest personal loan to purchase the $55,000 tiny house.
  • Two years later, the couple is now debt-free thanks to a budget and their low-cost lifestyle.
  • In the future, they hope to use the tiny house as a second source of income or to sell it and use the money as a down payment on a traditional house.

Some tiny house owners downsize to travel the country or to minimize their belongings, but one couple decided to move into a tiny house to pay off their six-figure debt.

In 2017, Marek Bush, who works in retail security, and Ko Bush, a teacher and waitress, realized they were around $100,000 in debt. They decided to move into a 200-square-foot tiny house, and two years later, the Bushes, who are both 28, are completely debt-free.

Take a look inside their tiny house and see why they call it a smart financial move.

In 2017, Marek and Ko Bush were living in a fancy loft apartment in Florida when they decided to make a lifestyle change.

In 2017, Marek and Ko Bush were living in a fancy loft apartment in Florida when they decided to make a lifestyle change.
Marek and Ko Bush. Courtesy of Marek and Ko Bush

At the time, they were living in a two-bedroom, two-bathroom apartment with all "the bells and whistles," including granite countertops and key fob entry.

"We woke up one day and realized how completely we were in debt," Marek Bush told Business Insider. "We decided we were going to pay off everything we owed."

They started putting a budget down on paper and figured out a plan to save money over the next few years, but they still had one major problem.

"We were like, 'How are we going to get serious about saving but we're still living in this super fancy place that is way more than what we need?'" he said.

That's when they turned to the tiny house movement.

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Marek did have to do some convincing to get Ko on board, however.

Marek did have to do some convincing to get Ko on board, however.
Marek and Ko. Courtesy of Marek and Ko Bush

"I started thinking about how we could keep the flexibility that renting offers, while also owning something that we can get value out of in the future if we decide to do something different," Marek said, "and the tiny house came to mind. It kind of met all of our goals."

But Ko wasn't immediately on board with the plan.

"It was the change of it all," she said. "Where was all of our stuff going to go if we were going tiny? We had a seven-piece bedroom set, a large sectional couch, a dining room table. We had a lot of furniture, and I just wasn't ready to let go of it. But once I got it through my head that it was just material things, I was like, 'You know what, it's a good idea. Let's get on board,' and I'm glad we did."

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Their first step to downsizing was selling off their furniture, which became vital in paying off a lot of their debt.

Their first step to downsizing was selling off their furniture, which became vital in paying off a lot of their debt.
Ko counting her money. Courtesy of Marek and Ko Bush

Marek and Ko took a creative approach to selling off their belongings. They set up their loft apartment like a retail store and hosted open houses where people would walk through and purchase items that they liked.

"It was basically like a garage sale but you had to come up [to our loft]," Marek said. "It was like a little showroom, but it felt like another job. It was the hardest part of the whole process."

However, it did surprise the Bushes that the sale of their furniture helped pay off a significant chunk of their debt right at the onset.

"When we sold everything, that was a cash flow that we were able to put directly into our debt," he said.

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The next step was to find a builder and develop a plan.

The next step was to find a builder and develop a plan.
The house in progress. Courtesy of Marek and Ko Bush

After doing some research, they decided to hire Cornerstone Tiny Homes in Florida to build their tiny house. It took them about eight hours to design and plan the tiny house of their dreams with the company.

"It was very, very stressful and unexpected," Ko said. "I didn't realize the complexity and detail that went into designing a home."

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They were able to purchase the $55,000 tiny house with help from a low-interest personal loan.

They were able to purchase the $55,000 tiny house with help from a low-interest personal loan.
Marek and Ko's tiny house. Courtesy of Marek and Ko Bush

The secured the loan via LightStream, the online lending division of SunTrust bank.

After four months of construction, the Bushes started their new life in their 200-square-foot home.

"It felt a lot bigger than I thought it would feel," Marek said. "It felt very, very big for being a tiny house. I like how clean, polished, and new everything was."

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For the next year and a half, the couple lived in RV parks with their tiny house, saving money and paying off debts.

For the next year and a half, the couple lived in RV parks with their tiny house, saving money and paying off debts.
The couple in the tiny house. Courtesy of Marek and Ko Bush

Their original plan was to live in an RV park until they found a tiny house community that they loved, but it was difficult to find a place to park their tiny house permanently because of zoning laws.

Eventually, the found a tiny house village in Texas in April 2019.

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But they made sure they still had the comforts of their previous home.

But they made sure they still had the comforts of their previous home.
The living space. Courtesy of Marek and Ko Bush

In their living room, there is a 55-inch TV and a three-seater couch, which has storage space underneath.

"We were big on keeping things as normal as they were in our previous living situation," Marek said.

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To the right of the living space, there is a door that leads to the bathroom, closet, and laundry room.

To the right of the living space, there is a door that leads to the bathroom, closet, and laundry room.
The bathroom. Tiny Home Tours/ YouTube

There's a stacked washer and dryer, toilet, sink, and shower all in the same space.

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Walking through the living room, there is a kitchen, which has been customized for the couple.

Walking through the living room, there is a kitchen, which has been customized for the couple.
The kitchen. Courtesy of Marek and Ko Bush

There is counter space on the left, and on the right, there is a fridge, a stainless steel stove, a microwave, wood countertops, and open shelving.

The ceiling in the kitchen is a bit higher than a traditional tiny house because Marek is over 6 feet tall and did not want to bump his head.

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Above the kitchen is the bedroom, which fits a king-size bed.

Above the kitchen is the bedroom, which fits a king-size bed.
The lofted bedroom. Courtesy of Marek and Ko Bush

"We wanted to keep the space really cozy up top, and it was already pretty tight and pretty small, so it was like we might as well make the bed cover the entire space so that when you're up there, it really feels like a cozy, little nook," Marek said.

The loft bedroom also has an intricate design in the ceiling — which Marek describes as a butterfly — that the builder included.

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In April 2019, two years after going tiny, the couple had completely paid off their $125,000 debt, including the cost of the tiny house itself.

In April 2019, two years after going tiny, the couple had completely paid off their $125,000 debt, including the cost of the tiny house itself.
Recently, the couple added a deck to the tiny house. Courtesy of Marek and Ko Bush

By creating a detailed budget, tracking their spending habits, and having a lower cost of living, the couple was able to become debt-free. They also paid off the loan they'd taken out for the cost of the tiny house.

"Ever since we've been in a tiny house, our electric bill has been next to nothing and pretty much everything else is included in our lot rental," Ko said.

Now that both Marek and Ko have been furloughed during the coronavirus pandemic, they said they are happy to be debt-free and that they are better prepared to tackle this new financial situation.

"Throughout the debt-free process, we got really in tune with our budget, so going into the coronavirus situation, we were already on the same page with money," Marek said. "Once we got furloughed from our jobs, it was very easy for us to go back to our budget and figure out what we can cut out and what we can shrink in order to have as little living expenses as possible."

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They hope the tiny house lifestyle will help them stay out of debt.

They hope the tiny house lifestyle will help them stay out of debt.
Inside the tiny house. Courtesy of Marek and Ko Bush

"We look at this as something that will help us continue to build wealth in the future," Marek said. "Now that the tiny house is paid off, if we bought a traditional house tomorrow, we could put this in the backyard and make it a rental property and pay the mortgage down, or [we can] sell the tiny house and come into the traditional house with a much larger down payment."

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The Bushes said they know there are so many reasons to downsize, but for them, the financial benefits greatly outweigh everything else.

The Bushes said they know there are so many reasons to downsize, but for them, the financial benefits greatly outweigh everything else.
Marek and Ko. Courtesy of Marek and Ko Bush

"For us, we looked at [tiny house living] from the financial perspective — where we are today financially versus where we are trying to go in the future," Marek said. "There are just so many options that you have when you reduce your expenses and reduce your lifestyle. It gives you so many more options."

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