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Personal Growth

Debt, the eff word of personal finance.

Debt.  It’s a four-letter word.  A word that brings fear and loathing into the hearts and minds of millions, me included.  Being in debt can be a dangerous situation, one I have found myself in not just once folks, but four times in my 32 adult years.  Like yikes, is it the eight-year itch?  Is it something I want to torture myself with over and over again….let’s assume yes.

So as it happens, my beautiful niece got married in July under the Tuscan Sun.  No not a restaurant, theme park or rental hall of the same name, but the genuine Tuscan sun one would find in Italy.  And I missed it.  Three guesses why and obvee, the first two don’t count. Yes, you figured it out….debt, debt, debt.  My nemisis, my hearthrob, my destiny?

What is it that drives us to buy, buy buy with wild abandon, with no thought to the long-term consequences? Is it societal?  Is it due to upbringing or a need to “keep up with the Jones’s?”  Whatever the reason I am writing this post not only to end my addiction to credit shopping, but also to give ideas and information to others as well.

A Day in the Life of Debt

I was forced to take a pretty hard look at my financial situation about a year ago as the credit limit on my visa was dwindling.

A phone call to the bank inquiring if I could get a consolidation loan led to this conversation;  The powers that be at the bank advised it wasn’t in my best interest as the interest on a loan of that kind would be higher than what I was paying on my Line of Credit Visa (LOC).  More back story, I owed over $10K to that (solely from balance transfers from my day to day Visa, balance $7K).

Funny note; at the same time I was being offered a $2000 credit limit increase on the day to day card???  The bottomless pit of credit hell to folks like me and you.  Anyway…the bank advised that they could “restructure” my debt.  Wtf does that mean you ask, well I shall tell you…

  • take the credit limit increase (say what now?)
  • then we will move the $7K debt to the LOC, but not increase your limit on the very same LOC (confused yet?)
  • take away my LOC visa card…good enough, never used it lol, remember? balance transfers!
  • then the $2000 increase I accepted would be the new limit on the day to day card
  • and finally, set up automatic payments through online banking on paydays to the LOC

Seemed reasonable, right?

Well I just couldn’t bring myself to do it.

Couldn’t make the call, couldn’t make an appointment to set it up.

Couldn’t, couldn’t, couldn’t.  It just didn’t feel right.

But you know what did feel right?  Taking that credit limit increase (bang head on wall yet again).

Fast forward one-year later and I have burned through another $1500 of credit FML.

The Plan!!

This is where I began using Pinterest to help me find a way out of this mess.  You can check out my board at Financial Goals

In those pins I found some really great information for my situation.  Some things I knew but hadn’t implemented, some things were new and things that I could do.  Dave Ramsey really knows his stuff!!

I had been saving money with an investment broker for the last four and a half years and had built up a decent amount of money, for me anyhow, as a person who has never had savings her entire life.  I had been clinging on to this money, with good reason, as I said, I had never had that before.

One Ramsey recommendation was to reduce personal savings to $1000.  I could do that with money I had squirreled elsewhere.  I looked at what I had saved and knew that due to taxes and back loading fees (money they take so you can have your money) I would take a loss, how much I didn’t know and hadn’t wanted to ask, but I took the plunge.

Happy Ending

Turns out the damage was not that bad, not in the overall scheme of things anyhow.  It would cost me just over $700 to get just under $9000.  My day to day visa had a balance of $8500.  Done and Done.  I saved the rest to cover next month’s payment as I know there will still be an amount owing for carrying a balance for part of this billing cycle.  But it’s paid, it is gdam, mothertrucking paid.  Thank christ.

Before I paid it off I had a look at my last visa statement.  It carries a little, and I mean tiny (they don’t want you to pay much attention to “that man behind the curtain”, thank you Wizard of Oz lol) note indicating that I could pay off my balance with minimum payments in….wait for it…..71 YEARS…71 gdam years.  I my friends, am 50. You do the math.

So here I now sit with that $10K debt on my LOC.  I can live with that.  Should I get another job to help me pay it off quicker?  Not an idea I am opposed to but I’ll have to see.  Not only am I working full-time and striving to become a world-class blogger, but I am also taking a university class this fall, stay tuned for that post bishes……

Debt, The eff word of personal finance
Debt, The eff word of personal finance

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