Dropping Debt Like a Bad Habit

My husband received the title to his truck in the mail today.  My car has been paid off for a few years now.  This makes us free and clear of car payments, and that makes me smile.  Within the next six months we will make our final mortgage payment, and we will have full ownership of our condominium.  We carry no credit card balances, putting us as close to debt free as we could hope to be.  That thought makes me do a mental happy dance.

The story has not always read this way.  As a single woman starting out in my twenties I did a sizable amount of damage to my credit score.  I was on my own for the first time, paying a mortgage, a car payment, college tuition, and household bills.  Like so many at that age I was seduced by the magic of instant money to be found in credit cards, and I used them like an easy pass on the buyer’s expressway.  To say that I was overextended would be an understatement.  There were times when I would send up a fervent prayer to the money gods before swiping my debit card to pay (I hoped) for hot dogs and soup to feed me for the week.

By the time we got married I was struggling to pay the minimum due on three credit cards, and I was stuck in accumulating interest hell.  Having my husband to contribute to the household bills helped, though I laugh now to think of our pathetic combined annual income back then.  I started to get the calls nobody likes to get.  Go figure, the same nice people who offered me those sky high credit limits now had the audacity to want the money returned.

The weight of debt is crushing and constant.  It goes everywhere you go.  It never leaves you alone.  It does not let you sleep, and it invades your thoughts throughout the day.  Keep it a secret, and it is like carrying around an elephant on your shoulders.  I told myself that I did not tell my husband because it was my debt, accumulated before we met, and my responsibility.  The truth was that I was ashamed and embarrassed.  How had I, a levelheaded, practical, and responsible person, let myself get here?

The day that I broke down and came clean was the day I threw the elephant off.  I refused to allow my husband to make any of the credit card payments, but we worked out a plan where he took on the bulk of the household expenses.  This left me free to chip away at the mountain of credit card debt, and it took years of chipping to reduce that mountain to a pile of rubble.  We are more than ten years past it now, but when I think of how much more we could have in savings if I had not gotten into that mess it makes me cringe.  I wish mine could serve as a cautionary tale to today’s young adults, but I think it is one of those things that only makes an impact if it happens to you.

We have taken a long road to get to where we are today.  Where we are is not rich (my husband did not go into law enforcement to seek his fortune, and I have been unemployed by choice for several months).  Where we are is living a modest but comfortable life.

Since I paid off the credit card debt we have made the conscious decision to live below our means.  Despite the urging of relatives and friends we chose to stay in our small condo rather than buying a house and taking on a larger mortgage.  We now have one credit card each, and we only use them for online purchases and reservations (for security purposes we do not use our debit cards online).  The balance is paid off immediately with no interest accumulation.  We pay cash for everything else.  We took two trips within the past five months, and they were both paid in full before we ever boarded the planes.

I know that our lifestyle choices are not suitable or desirable for everyone.  I am encouraged, though, by the growing trend toward minimalism.  It is liberating to not feel the need to accumulate things.  It provides you with the ability to look at your career choice with a certain clarity.  Making your employment decisions based on your desire to do something that you enjoy, rather than based on income need, is a gift. (If what you love to do happens to provide you with a substantial income then by all means, go to it!)  The bottom line is that you can get by with less than you might think.  I am not advocating that everyone run off to sell their houses and cars.  What works for us may not work for you.  Your means may well be more than ours.  The idea is to live within them, not above them.

I am aware that circumstances could change.  There are honest, hard-working people struggling to get by due to things that are out of their control such as divorce, disease, or disability.  We may be one illness, one accident, or one unforeseen disaster away from a daunting pile of bills.  All we can do is hope for the best while preparing for the worst, and that is why we will continue to drop debt like the bad habit that it is.


All photo credits: http://www.pixabay.com

 

Advertisements

45 thoughts on “Dropping Debt Like a Bad Habit

    • I went to a two-year technical college at night while working full-time. I paid as I went so thankfully was not strapped with student loan repayment on top of the other debt. I feel for college students today, having to start out with that weight on their shoulders (that’s a whole new subject for debate) But yes, with work there is light at the end of the tunnel!

      Liked by 2 people

    • It is a nice feeling! We are both from New Jersey originally, and we are now in South Carolina where the cost of living is significantly lower- the difference in property taxes and insurance alone is huge. Thank you for reading and commenting. I’ll be sure to come check out your blog! 🙂

      Liked by 1 person

    • We do not have children, and that admittedly helps a great deal with debt control. Your son is going into a great field that is wide open for potential. If I could go back all those years I would rethink my major and choose something in the medical field. I am sure it is a wise investment, plus he can take care of you in your later years. 🙂

      Liked by 1 person

  1. Great job, going from where you were to where you are! It’s hard not to be tempted by all that glitters out there… but I am a firm advocate for living a simple life! It’s amazing how much really is “want” vs “need” in our lives. I am sure you’ve inspired a great many with this post! 🙂

    Liked by 1 person

    • That is exactly how I analyze my purchases now…how much do I need this versus how much do I want this? We do still indulge, but now it’s in travel and experiences instead of things. If we could curb our dining expenses (we eat out far too often) we might be a few years closer to retirement. 😉 I can see us in one of those tiny houses one day…we’ll see if I can sell the husband on the idea. 🙂

      Liked by 1 person

      • Oh, I think it’s great to enjoy travel and eating out! My husband and I indulge in such things too – I have to say, some of our best conversations are had over a pint and dinner. I always say, if the cash is in the bank, and the bills are paid, enjoy yourself – terribly un-poetic, but you get the idea. 🙂

        Liked by 1 person

  2. Good for you! Hubby and I don’t owe a penny to a soul, and gave our credit cards back to the bank last year. Basically, if we don’t have the money, we don’t buy it. Things are budgeted for (dog care, dentist, car etc) so as not to have any unpleasant surprises. Whatever we own that isn’t in the boat is in the car.
    We still have the occasional treat, but each time we shop, we ask ourselves these questions:
    Do I want it?
    Do I need it?
    Will my life end if I don’t have it?
    and more recently
    Where will it fit in the boat?
    😀

    Liked by 2 people

    • I cannot emphasize to people enough how liberating and worry-free it is to not have a cloud of debt hanging over your head. We, too, have budgeted for emergencies. When we needed to replace our heat pump and water heater last year we had the cash to do so. Things don’t sting as much when you can pay for them and move on. I would love to downsize a step in the future. I am investigating the tiny houses, although I believe my husband would prefer your choice of the boat. 😉

      Like

      • We intended to downsize to a smaller property but got priced out of the market, even though we had been mortgage free on our previous property. The boat was the best option available, and it’s not that bad. If we go back into bricks and mortar, at least we won’t have to worry about removal fees as we’ve got no furniture!

        Liked by 1 person

  3. Your wisdom will pay off. Getting out of debt is the smartest thing my husband and I did many years ago and I don’t regret it for a moment. And you’re right, the credit card companies make it all too luring to come aboard and are the first to harass you if you slip behind. Keep up with your smart, mature money-handling and you’ll be rewarded in the future, if not already.

    Liked by 1 person

    • The only ones I’ve seen go after people quicker than credit card companies are hospitals and doctors’ offices. I would like to continue to save to have a sizable amount set aside in the event of an illness or emergency. I would also like to be prepared in the event that either or both of us require long-term care in the future.

      Like

  4. I wish I was debt free. I have college debt and credit card debt! I am working on them one day at a time. Haha it’s rough being independent sometimes. 😀

    Like

  5. Well done!!! I am struggling horribly with my finances, and the hardest part is the shame of knowing it is no one’s fault but my own, and I should have known better.

    Reading success stories is reassuring and helpful.

    Congrats!

    Like

  6. Well done on reaching this stage with your finances and being honest about the mistakes that you made while you were younger. I got my first credit card when I moved to the US (because I had no credit score in the US of course) but I always pay it off immediately and my wife and I share the same philosophy as you, deliberately living below our means and being rather minimalist. Next step is paying off my UK student loan. Its so refreshing to not be stressing about money all the time and not falling into the trap of having to have the latest TV and iphone etc 🙂

    Liked by 1 person

    • Good to hear that you & your wife are being so smart early on in your marriage! Believe me, it will pay off for you in the years to come. Not feeling driven to have the latest and the greatest of everything prevents a lot of stress for sure!

      Liked by 1 person

  7. I liked reading your story. Congrats on being debt-free! I can imagine the mental happy dance :), it must have been a long journay.
    And it’s true that we can get by with less then we think, and still live the life we love!It’s an inspiring story!

    Like

  8. Congratulations on being done with the cars, and down to only six more months on the property. I paid off my car last year, credit card debts I have not had for years (I learned my lesson early), and I’m chipping away at a quick rate on my mortgage. Just the other day I paid down a bigger lump sum – http://minimalistsometimes.com/2015/03/04/a-lump-sum-14-worth/ – and I’m now down to one third left 🙂 🙂 If I keep this up, I will be done with my mortgage several years early.. !

    Liked by 1 person

  9. Working on the same thing myself, took me a couple of years to come clean to my partner about my accumulated debts, but now thanks to his help and a bit of frugalism, they’re coming down slowly but surely. The relief is immense.

    Liked by 1 person

    • Telling my husband where I was at immediately lifted a huge burden off of me. When you see the balances dropping, slowly but surely, it is encouraging and exciting. Keep at it, and I am glad you have a supportive partner- that is a huge part of my success story, too. 🙂

      Like

  10. I am so glad that I was aware of the importance of keeping my debt low and my credit score high when I was working. I’ve discovered that the secret to managing a reduced and fixed income is cash flow…

    I use cash back credit cards to make my monthly purchases and pay them off–and I took out a small
    loan that allows me to have a cash reserve for emergencies or for essential purchases…
    Excellent post. It’s great that you freed yourself from debt–it is ultimately a form of
    indentured servitude because people find themselves trapped in dead end jobs that they
    can’t leave.

    Liked by 1 person

    • You make an important point here. Most people are not prepared in the event that they experience an unexpected change in their income level. You could not be more right- I cannot count the number of times I have heard people say that they wish they could leave their current jobs, but they cannot because they are not in a position to take a temporary reduction in pay.

      Thank you for reading and for sharing your insights! Best, Karen

      Liked by 1 person

      • You’re post took a confusing an economic abstraction regarding credit and debt and very simply demonstrated the every day implications of not fully understanding that a credit card is a small spade that is often used for digging deep holes.

        Liked by 1 person

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s