A Story Of Debt

Sometimes I fantasize about being debt free.  Just substitute always for sometimes.  I’m not thinking about living in a mansion and driving a Mercedes.  I’m just thinking about a life with reliable things that I have the funds to replace when I need to.

The recession ripped out from under me the safety net I didn’t know I was relying on.  My confidence that I could always get by somehow diminished.  And I wasn’t affected in any dramatic way, but watching people who had worked their whole lives losing their jobs, having no more protections in place than I do at 26, made everything feel uncertain.  When it started affecting my parents, however minimally, I was scared.  It seemed that no matter what you do, you’re always at risk.

Changing my mind to get out of debt changed my thoughts about the future as well.  There is a lot I can do to make myself financially stable.  It’s just that I’m impatient to get there already.  I want a more reliable car and six months worth of expenses in savings and other adult things!  Basically, I want nice things.

But, this has been a mind trap for me before.  A way I delude myself.  I think, I’ll buy this quality thing and then I won’t have to replace it.  It’s a variation of I’ll just buy this one last thing and then that will be it, which is a variation of I’ll just get high one last time and then that will be it (I’ve been watching a lot of Weeds lately).

January was a difficult financial month for reasons I’ve already discussed.  More than the circumstances out of my control and any small mistakes I made, my mind just wasn’t quite in the game.  Or maybe I was just frustrated, because I couldn’t live up to my own expectations.  Things weren’t going perfectly and it’s hard to feel like you’re not making progress when you’re working so hard.

I’m also getting to that point where I’ve been at this long enough now that it’s not at the front of my mind all the time, which makes me nervous.

February, I’m feeling good about.  I’m focused and ready to get back on track.  Maybe I was never really off track, but with goals, it’s the right mindset that will get you through.

My major goal is to put a huge sum of money toward my credit card, but to keep myself focused on a daily basis, I’m aiming for 15 No Spend Days.  I think I can do better than that, but I’m starting small.

To me, there is a stigma to the words “I’m busy” or at least to saying them out loud to other people.  I wrote about it on my personal blog once.  Even now that I know I am really busy, I can’t quite get over the stigma.  But, I’ll ignore that feeling for now, because I am busy.  Crazy busy.  No time for anything busy (except blogging, of course, because I can do that from work).

There’s no reason to complain about being busy when it comes to debt reduction, though.  It’s all upside.  First, I am mostly busy working.  Working jobs that pay me. And they pay pretty decently–I mean, not career well, but better-than-most-of-the-grad-students-I-know-get-paid well.

What I learned in the first two weeks of January, when I was only working one job, was that I am less expensive when I’m busy.  I don’t eat as much and I don’t care as much about what I eat.  I also don’t go anywhere, except for school and work, which are all within a half-mile of each other.

I definitely don’t shop, because there’s no time and it’s the last thing I want to do with my little time off.   I don’t usually shop even when I’m not crazy busy, because I’ve sworn it off while I try to get out of debt.  But, being busy removes all the temptation and opportunity, so that I don’t even think about it.

Okay, so maybe there are some risks to being so busy.  Aside from burnout, there’s the danger of being too tired to care or be strict with myself.  There’s also the occasional problem of not having time to buy proper groceries, which leaves me eating out.  A combination of the two is what sometimes gets me.  It’s not that there’s no food in my apartment; it’s just that it’s not anything I want to eat and after working so hard, I feel like I deserve better.  Fortunately for me, I consider better to be fast food and I’ve been making a more focused effort to keep myself better fed this semester, so it doesn’t come to that.

To name the last and probably biggest upside, a goal like getting out of debt gives me a great deal of motivation that keeps my attitude up when I’m busier than is comfortable and tired and dying to go home.

I was driving home from the grocery store several days ago, going through the numbers in my head to figure out if I could still make my January goal.  I do this all the time and I get very stressed about whether I can make my goal or not.  The goals are not easy; they don’t leave any room for error.

This one time, though, I guess because the answer was that I couldn’t make my goal, it occurred to me how silly it is to stress myself out about a goal I made for myself and that no one else even knows about (the specific number, I mean) and that is a serious stretch (so I am likely to fail and even if I do, I still will have put a lot of money toward my debt).

I’m not usually good at following rules I’ve set for myself, but I just really want to be out of debt and the thought of getting complacent in this makes me very anxious.

The thing about spending money is that you can’t go cold turkey.  I still have to eat and I need a roof over my head!  Sometimes it’s hard for me to draw the line between being reasonable and giving myself too much slack.  There are many ways to approach getting out of debt and I took a page out of Dave Ramsey’s book and am doing it with gazelle-like intensity.

This is the way I want to do it, but I can’t say that the stress isn’t really stress.  It is stress, but the adrenaline-fueled kind and not the dread-filled kind.  One way I stress myself out is by keeping very little in my checking account at a time (it’s over draft protected with my savings account, which has $300 in it).  Often I’m trying to get through a week on $50, which I can do since I don’t have to get gas regularly and aside from bills, groceries are my only big expense.  It’s a game to see if I can do it.

I think the whole thing occurred to be suddenly as silly because I was in this mindset that I am poor and this is all the money I have in the world right now. That’s ridiculous in a sense, because I’m actually bringing in quite a bit of money–enough to put hundreds of dollars toward my debt every month.  But, it’s completely true in another sense, because, of course, I am in debt!  I have available credit, but not money that isn’t owed to someone else.

I can see myself starting to think of money differently.  Most importantly, I’m breaking the habit of looking at available credit as available funds.  And the challenge is fun.

January has been so damn expensive. I swear the day I bought my new lap top (which I’m now in love with, of course), my car started making a weird noise. It’s only done it a few times, but it’s that screeching noise that cars make. I don’t know what that means, but I know it will involve spending money in the future.

The problem, though, is that I’m starting to do exactly what I said I wouldn’t. Things I couldn’t help came up and I’m starting to use that as justification enough to buy other things, however small they may be. It’s like, my plans got derailed, so what does it matter now? But, that’s exactly the attitude that got me into debt in the first place!

So, please forgive me for I have sinned. I bought the first two seasons of Weeds, because I love the show and they were on sale. I also bought a pizza, which may not be worth mentioning, but it’s an expensive meal (or a total of three meals) in a month when I have already gone over my grocery budget.

I don’t feel off track. I just feel bad habits creeping up on me and I’m not going to let them. Not while I’m working so hard to earn the money to get myself out of debt.

I got my Mac Book Pro two and a half years ago, and I have loved her every day since. But, last week she quit on me and I was forced to make a difficult decision. Not only is she like a friend, but replacing her would be very expensive.

I really can’t go without a computer. Not only is the internet a huge part of my life, but I have school and work that I need to take care of. And, okay, I’m not really without a computer right now. I still have my old Dell, but that’s pratically like being without a computer (I’m not a PC hater–I use them every day at work–but this laptop is a piece of crap).

I am particularly trouble at having to make this purchase, because I haven’t technically paid for that laptop I loved so much. I bought it on the card with the biggest balance and I won’t consider it paid for until I am completely out of debt.

But, this purchase is a bit different, because I do have the money. I can pay for it right now. And, I’m grateful at least that the old girl held out until now, because if this had happened three months ago, I would have been screwed.

So, this is a set back and it’s frustrating to lose a month’s worth of progress in order to replace a laptop I was happy to continue on with, but getting my tax return will make up for it a bit and I really am excited to welcome a new Mac into my life.

I have spent every January for the last 4-5 years in a funk.  I don’t know what it is.  But, there is less than a week left in this January and I’m happy to report that I am not going through a mini-crisis.  I’m happy and doing well.

But, it’s not been the best month for debt reduction.  I was looking forward to January, thinking it would be the first normal month I’ve had since I decided to get out of debt.  By the time I made the decision in November, I’d already had several big expenses that month.   Then December was a mess of traveling and buying presents and not working much at my second job and receiving presents that more than made up for missed working hours.

January was going to be different!  But, I forgot about (more like, chose not to think about) a few things like school fees I need to pay out of pocket and books for class and even more missed hours at my second job (I overestimated by ability to be in two places at once).  I have also spent a great deal more at the grocery store this month, which is partly to do with me being a little less strict (I should not have gone grocery shopping on a Friday night while starving) and partly to do with the fact that  school didn’t start until this week, so while I was still working full time, I was home a lot more and with much less to do, so I ate more.   Then, the screen on my MacBook Pro, which I love like the child I don’t have, went dead; I can’t get through life without it, so I have to get it fixed.

Bottom line, January has not been terrible.  I’ve just set a really high standard for myself, because I want to get out of debt, like, now! And I’m going to come up short.  Still, I’ve already paid all my bills and put $700 toward the WF Visa I’m now trying to pay off.  After pay day, I should be able to put another $300 toward it.

February is going to be awesome.  I will be working a ton and I hope to get my tax return (all of which will go toward my debt).  But, I’m not going to do what I’ve done in the past.  I’m not going to say, screw it! and give up on January.  I’m going to see it to the end and get as much success out of it as I can.

I know a lot of people do this and I think it’s a cool idea, so I’m going to do it too.  I already go at least a couple days each week without spending money.  I have very little time between Sunday and Thursday morning to buy anything.   But, I suspect this is going to be a little more difficult than I’m expecting.  No spending means not even $.80 at the vending machine!

To get into the specifics, I’m going to track the days I spend nothing, though right now I have no goal in mind except do it as many days as possible. Maybe I will make a goal at the beginning of each month, but for now I’m going to try to just get in the habit.   I won’t count paying bills like I do each pay day or paying for laundry (the last thing I need is something to deter me from doing laundry!).

Challenge on!

I think it’s time I face some of the mistakes I’ve made that have led me to the debt I’m in right now.  It was certainly not one thing, but rather a series of things that built on each other.  I’ve forgiven myself for these mistakes and I think some of them actually led me to very positive developments, but what troubles me about them is that I knew I wasn’t doing the right thing, but I did it anyway, sometimes passively and other times actively.

In order of occurrence:

1. Cutting back on hours at work. In my junior year of college, I was overwhelmed with coursework and cut my hours back at work.  It was one particular class (Shakespeare!)  that was taking up most of my time, but after that class was over, I didn’t take my hours back up.  It felt nice to have time to just be a student, which I don’t totally blame myself for, but it meant I wasn’t earning enough to pay for college out of pocket.  I set myself behind and had to get loans the next year.
2. Down from two jobs to one. In my senior year, I had an opportunity to work in a writing center, so for a while I worked two jobs.  That December, though, I decided to cut back to just one.  It was again nice to have more time to be a student, but I gave up the job where I could have as many hours as I wanted, which meant that when the summer between college and grad school came around, I was working only 17 hours a week instead of 40.  I could have been so much better prepared for moving away to grad school.
3. Buying my car for more than it was worth. This one really burns me.  I just hated shopping for cars and so I found one I liked and let myself get talked into paying too much for it.  It’s been a good car for me, but I could have gotten a much better deal on something comparable.  It’s paid off now, but that was after making payments for three years.
4. Paying too much for rent. When I made my plans for grad school, I budgeted for a studio apartment on campus.  But, none were available, so I settled for a one bedroom with the promise that a studio would probably be available the next semester.  The woman in charge of housing was then laid off, so the list of people waiting for studio apartment was lost in the shuffle and I passively continued paying more than I could afford for a one bedroom (also because I like the extra space).  I did that for two years.  Easily the most costly mistake I made.  So much of my credit card debt is rent from 1-2 years ago.   Just over a year ago, I corrected this by moving into a studio.
5. Working only 15 hours a week. In my two years of grad school, I worked on campus.  We were only allowed to work 15 hours a week, so that’s what I did.  I sometimes felt overwhelmed even by that.  The mistake I made was in settling for that 15 hours a week even during the summer between those two years.  I could have been working more than full time, pulling myself out of the debt I’d already accumulated. I just did what was easy.
6. Viewing credit as available funds. This computer I’m typing on right now cost me $2,000.  I could not afford it at all when I bought it.  I did it on credit, which means I still haven’t actually paid for it.  Now, I love this computer and don’t regret it, but what was I thinking ever buying it?  I didn’t even need it at the time.  I think that I was so far in debt that I bought more things thinking, what difference does it make now? There was a time when I was losing weight and would use purchases to treat myself–weekly spending sprees at Target, basically.  I convinced myself I’d earned it.  Never mind if I could afford it.
7. Taking an extra year to graduate. This one is hard to judge, because it’s full of good and bad.  If I had applied to PhD programs the year before (pre-recession), I probably would have had a better chance of getting more aid in paying for my education.  But, I wouldn’t have ever needed or found my current full-time job that’s making it possible for me to pay down my debt while I’m still going to school full time.  Another bad was that I had to start paying on my student loans and that was a lot of money out every month that didn’t go toward my other debts.
8. Not planning ahead to find a job. My on campus job ended when I was no longer a full-time student.  I saw the end coming, but only passively looked for a job.  The result was a month and a half of unemployment when I had zero money coming in.  Thank goodness I eventually found a great job, but why wasn’t I more freaked out about my imminent unemployment?  That month and a half set me very far behind and I lived exclusively on credit.  That’s when this first became a crisis.
9. Spinning my wheels while making good money. I’ve had my job for more than a year, but I’m pretty much in the same financial position I was when I started.  The debt hasn’t increased, but neither has it decreased.  Why?  Well, I did have some big expenses come up, but the troubling reason is that I’ve spent too much.  When I think of what I’ve spent on just makeup and nail polish in the last year, it’s enough to make me want to throw up.  I mean, come on.  I don’t know what I was thinking.
10. Using avoidance as my financial method of choice. Things got bad and though I was finally in a place where I could turn things around, I chose avoidance instead.  It had become the way I dealt with my finances, especially when they were overwhelming.  Avoidance meant continuing to spend, never looking too closely at the numbers as the credit card balances went up and my checking account balance went down.

When I paid off my first card, I thought a lot about what to do with it.  First there was the matter of not wanting to let it go, because what if something comes up!

After I got over that, my thoughts turned to cutting it up.  That’s what you’re supposed to do, right?  But, I had no strong desire to take out my aggressions on a piece of plastic.

Now that I’ve thought more about it, I think I will be quite relieved to be rid of that piece of plastic with no option of picking it up again and using it to abandon reason.

It’s just that I know a lot of people who have both rational and irrational anger toward credit card and loan companies.  And it’s not like Sallie Mae is my best friend and my experience with Bank of America has made me not want to have any experiences with them in the future, but I’m not angry.

It would be easy to say that the anger I have is with myself, but that’s not really true either.  I blame myself for the debt I am in and I know it’s my responsibility alone to deal with it, but I’m not really angry at myself.   I made some mistakes and they are embarrassing—super embarrassing—but still I’m not angry.

Not that that’s any great feat.  Really, I’m just not an angry person except when I’m in waiting rooms.  Left alone in a waiting room with that piece of plastic, I would surely take my aggression out on it.

I’m taking scissors to the card.  I’ll let you know if it takes a surprising turn.