Nothing weighs you down like debt. It makes it difficult to keep up with the big-ticket financial necessities like saving for retirement, purchasing a home, and setting up a college savings fund for your kids. If it’s there, though, you can’t deny it. The only way out from under debt is to address it aggressively. Once you do, you’re going to find that with a solid plan, and some sacrifice and ingenuity, it’s actually not that steep a climb.
Here’s the story of how I fell into $25,000 worth of debt and what I did to get out of it:
How It Began
I first fell into debt because I signed up for a student credit card at an age where I was totally unprepared to handle its responsibility. I was in my early college years, and once I had that first piece of plastic in hand, I was off to the races. I bought every electronic gadget I could find, I treated my friends to nice dinners out, I lived carefree and well beyond my means.
At first, I got by paying the minimum on my card. When it maxed out, I signed up for another. And another, and another. Before I knew it, my entire house of (credit) cards came crashing down. At the end of the day, every single card I had was closed due to non-payment or going over my limit.
How I Put an End to It
I had just graduated college at the time and I was living at home with my parents. They financed the majority of my education, and now that I had finished, they wanted their money back. When they got a look at my credit card statements, they went through the roof. I had two choices: let them take over my finances completely or make some serious changes myself.
I found work shortly thereafter, and from the get-go, I busted my tail to qualify for every bonus and incentive at my disposal. I worked overtime, and sent all my extra earnings to my parents to pay off my college tab. I moved into an apartment, but I still continued to save. I clipped coupons to save on groceries, I got frugal with my thermostat to save on home energy, and I never signed up for home telephone service.
Then, I attacked my so-called “daily” purchases. I stopped going to the convenience store for anything except gas, I quit buying lottery tickets, I eliminated snacks and sodas, and I got my news online instead of buying newspapers. I told myself there would be no new upgrades of clothing or electronic gadgets until I was debt-free. I also sold off all my old cell phones and digital cameras on the Internet to generate extra income. I even worked an extra summer job or two for a time. It took me roughly three years to dig this hole for myself and just under four to get out from under it, but I did it.
Where I Am Now
Once I finally paid off my last balance, I vowed never to carry one again. I continued the frugal lifestyle I’d adopted, and still do to this day. I now have a healthy emergency fund established in case I were to lose my job, incur a major medical expense or other financial calamity, and while I am still a bit behind on my retirement savings, I’m working hard to get caught up. My early twenties were a roller-coaster ride, and although I’m embarrassed about the amount of debt I fell into, I’m very proud for having climbed out from under it.
Remember, the sacrifices you make to get out of debt are not forever. You can still buy that flat screen TV, you just have to wait until your balances are paid off and you can afford to buy it without charging it to a credit card. Purchases like this should be framed as rewards for a job well done – only, after you do the job. Financial freedom is out there waiting for you, but like all freedom, it comes with responsibility. Remember that, and you can live a long and healthy financial life.
What are you doing about your level of debt?
About the Author:
David Bakke, writes about tips and strategies for smart shopping and frugal money management, all while working to help prevent identity theft and other security issues.
This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.
Published by permission from ConsumerInfo.com, Inc. © 2013 ConsumerInfo.com, Inc. All rights reserved.