You could say the tone of my blog is kind of austere. It reflects the mood of the year for me, a year of investment and renewal. Blah blah, I write about this all the time. But today, I reached a major milestone related to all my cost-cutting and modest living: I'm finally out of (credit card) debt!
I have been gabbing on and on about my credit card debt issues with my coworkers and friends for months. Ever since I got a job after grad school, it's been my expressed desire to pay down my credit card by paying a health dosage over the minimum payment every month. In addition to this, I've saved and worked to bring down the debt entirely in a reasonable amount of time.
Well, a funny thing happened on the way to fiscal sanity. I realized that, if I took the money I was saving toward a new computer, I could pay down my debt a whole year early. I did some calculating, and I could save hundreds of dollars in interest doing this and I really felt I could stick it out years with the computer I have currently (I really just wanted to have the money on deck, collecting interest, in the event many months from now I want to replace my computer).
Even though paying off my credit card won't make everything in my world better — I still have student loans and I plan on shifting my above-the-minimum attitude toward that balance now — this is a huge psychological weight off my shoulders. Ever since June 2002, when I opened my first credit card to handle a major car repair I had at the time, I have lived under the burden of a credit card. Initially, it felt so unnatural knowing I could not pay down a debt with the amount of money I could make in one pay period. This was a feeling I just got used to.
My debt grew a lot in college as other car repairs came and I eventually moved the balance to a low-interest credit card. A few road trips here and there and I had near $2,000 in debt! Luckily, I spent a summer paying down the debt to below $1,000, and it seemed like I could kill it for good way back in 2005, but then life happened. Moving to California via a 3-month sojourn to Ohio cost me over $2,000! Plus I had to throw a $1,000 security deposit on my credit card just to get my first apartment. Suddenly, I was dealing with a major balance.
Can you believe that, back in the fall of 2005, I scoffed at the idea of budgeting to pay off my credit card as soon as 2007? It seemed way too far out for me and I wanted to do it sooner. When I took my eye off the prize and found myself into 2006 charging a trip to Europe on the card (!!), suddenly 2007 didn't seem so bad.
I got it down a few thousand dollars before I moved to Missouri for grad school, but I couldn't kill it entirely. In grad school, I paid down my second credit card with excess student loan money, but there was nothing I could do about my major debt until I had an income again. In 2010, I leaned on the card a lot to get me through the months before I graduated and finally found a job. It was then (conveniently for the credit card) that my interest rate more than DOUBLED, racking up major interest payments.
I have no idea how much I've paid on various card over the years, but I can tell you that on my most recent credit card, I've paid over $1,050 in interest and fees alone. It's mind boggling.
But now I can take a step forward without the weight of credit card debt. Like I said, it doesn't solve all my problems. The challenge now is to save money and not spend wildly now that I have more money every month. I'd like to save up for the new computer in the next year and put money away for a rainy day. Also, I'd like to invest and hopefully save some money to buy a condo or apartment somewhere down the line. That will take years, but I'm ready to work toward that goal.
To commemorate this moment, I unearthed an old blog entry of mine that I wrote the week I first went into credit card debt. That was nine years ago! It's amazing how such a small debt caused such a huge headache for me:
... So, how was my week of hell? It was horrible and I have a $1000+ bill to
work off. Once again, I really feel this is not that bad and that I'm
really blessed to even have a chance at paying all this back. ...
Now that I've had the chance to pay it back, I hope I'm blessed with the good fortune to never run a prolonged credit card balance again!
These entries primarily concern my personal life. I've blogged for years about my life, but I've learned not to get too personal. Favorite subjects of mine in the past include training and running marathons, writing about travel, and your everyday ruminations about life.
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