Family of four lives debt-free on $40K a year

Danny Kofke and his wife, Tracy Kofke, have made the seemingly impossible possible.

The Jackson County, Ga., couple are both school teachers, but even before they married and had kids, they decided Tracy would stay at home. The Kofkes also decided the family would never carry any debt aside from their mortgage

On Danny Kofke's salary of about $40,000, the family of four has managed to stay out of debt, build some savings and keep Tracy at home raising the kids for seven years. And they're still doing it.

How?

One of their suggestions is for couples to set their financial goals together.

Danny Kofke said, "Long-term planning was huge in our (arrangement). Obviously, if one of us is a spender and one is a saver, it's going to be very difficult, and we discussed this before we had children, while Tracy was still a school teacher and we were making two incomes at that time and relatively larger than what we are doing now, but, obviously, to live off 40 grand a year, we couldn't have a lot of debt and huge mortgage payments and car payments. So while she was working, we worked toward the future to prepare ourselves to live on my teacher's salary alone."

For more tips on how they do it - and thrive - check on the video above.

For more information on living for less, check out Danny Kofke's book, "A Simple Book of Financial Wisdom: Teach Yourself (and Your Kids) How to Live Wealthy with Little Money."