Tuesday, January 25, 2011

Interlude: How Did I Get Here?

I graduated college with a 3.73 GPA, a liberal arts degree, and more than $5,000 in credit card debt.

As an unemployed graduate, panicked does not even begin to describe what I felt about that overwhelming number. Adding to that anxiety was the knowledge that I:

A) still did not know what I wanted to be when I grew up,
B) had few marketable skills, and
C) had no idea what kind of job I could get.

I went to college because I didn't want to work minimum wage anymore. However, I had no idea that, with a liberal arts degree, I'd come out of college with the inability to demand more. Had I been in a better financial position to begin with, I likely could have held out for a much more lucrative offer or I could have possibly gone back to school for a Master's. As it was, I took the first job offered me and then took on two more part time jobs at little more than minimum wage.

Additionally, I did the dreaded thing - what every adult child hopes will never happen and what many other college graduates my age (and older) have had to do at one time or another...I moved back "home" to my dad's. Unfortunately, it wasn't enough. When the creditors began calling and talking to him, the gig was up. Busted.

Surprisingly, he was pretty awesome about dragging me by my 24-year-old ear, kicking, screaming, and crying down to the Consumer Credit Counseling center as he made me sign up. He even kept his own yelling to a minimum.

I signed up. I did all the work. I relinquished my cards to my counselor. She contacted all my debtors and negotiated special terms for me. And then I sent her 70% of my net pay - a figure she and I came up with together - so that, in just over a year - I was credit card debt free.


It. Was. Painful. I had just enough to pay for room and board (my father generously provided both for just $300 a month), 1 tank of gas a month, and $25 a week for everything else including cigarettes, hair cuts, clothing, toiletries, and any other incidental expense.

For 14 months, I did not eat out, see friends, have a gourmet cup of coffee, buy books or CDs, go to the movies. I worked. I went home. I sent my check each month. I cried...a lot.

I chose to do it that way. It was my choice to get out of debt as fast as humanly possible. I set the dollar amount of my monthly payments. I knew it would be AW-FUL. But I also knew, at the end of the ordeal, I'd be credit card debt free and able to get out of my dad's house! Priority #1. We've all got them. That was mine.

I did great after that...for awhile. No cards, no bills other than the basics. I moved out of my dad's and in with two roommates. I got a job making a little bit better money and decided to go it alone. And then I acquired a live in boyfriend and I thought we would be together forever.


I got an even better job. We upsized to a bigger apartment. We bought his and hers computers. We bought him a car. We bought me a new car. We had cable television and high speed internet and cell phones. We ate out. A lot. We could afford it. We were a two-income household! Right?

Slowly but surely, the debt began to pile back on. As the relationship began to disintegrate, I began to spend recklessly attempting to, what? Buy his love back? Make us both happy? I can't answer that beyond saying the spending was most certainly psychologically driven.

When he left, I was stuck with the expensive apartment and the brand new car. I tried to manage the debt on my own, tried to budget and stick to it, but little things...silly things...arose with alarming frequency and I was forced to put even more on the cards until pretty soon I was pushing up against the ceiling. I stopped opening my mail. I stopped opening my door. I stopped answering the phone.

Eventually, I would have a practice run at a mid-life crisis, cash out my retirement, live on it for 6 months, and then decide it was better to be underpaid and passionate about my job than to be well-paid and miserable. I still hold firm to that belief. It's just not a belief that helps reduce debt.

How it did help though, is it forced me to really take a look at my finances, develop a budget, and try to stick to it so that I didn't get any further into debt. And I haven't...exactly. I did have an issue with the IRS in that, when they caught wind of the retirement cash out, they rubbed their greedy governmental hands together and slammed me with a 10% penalty in addition to regular taxes. So I adjusted my then current withholding in order to meet my payment arrangement obligations...in essence, robbing Peter to pay Peter. Just this past year, I've finally gotten that piece under control and am expecting a little tiny refund from them this year for the first time in years.

Aside from that, I was promoted twice and am no longer underpaid. I make a modestly decent living and I've managed to get by fairly well. For instance, four years ago, I was more than $25,000 in debt - including the car. I managed to pay that off and pay off one of my student loans ridding myself of more than $7,000 of the outstanding debt I had.

And I don't buy a lot of "stuff". I drive a 10-year-old car that's paid for, I rarely clothes shop unless I must, I have a library card. We don't have television channels. We don't subscribe to Netflix. Occasionally, I splurge on a new kitchen gadget. But as far as stuff goes? I just don't have much. Nearly everything in my modest, basement apartment (politely called a garden level) is secondhand and was free including my terrible excuse for a bed.

But what I do have a taste for is taking care of others. I donate a lot of my money to people who need it. I've also treated many a friend to suppers out, drinks, late night breakfast foods. I bake out of love. A lot. I (used to) entertain a lot. We've always had an open bar policy at The Grotto. I've also developed a taste for new and different dining experiences, fine wines, top shelf gin, and travel. Mostly though, my "discretionary income" has been used to cultivate and nurture my relationships.

So...somewhere along the line, I lost focus on getting out of debt. I just continued to make my $20+minimum payments on my cards and sometimes used them...when I had to. For...whatever (let's just leave it at that).

Then, in December, Lex - my partner in crime - brought up the idea again of buying a house together.

I hung my head, knowing full well no mortgage company - especially after the sub-prime mortgage crisis and today's economic climate - would come near me with a mortgage.

"I can't," I said.

"Oh surely, you can," he said.

"Um...no. I really can't," I said.

It would take weeks for me to come clean about my level of debt with someone I love and trust beyond measure. I was embarrassed...ashamed...mortified. While I knew and have known for quite some time just how much debt I was carrying, it never mattered to anyone else before now. And, frankly, talking about that kind of thing is a major taboo in America. Don't ask. Don't tell.

The conversation forced me to think about it. Seriously think about it. In the midst of #reverb10, I thought about it and, just as though the universe were speaking only to me, a writing prompt about action and accomplishment was delivered unto me and I got cranky. Really really cranky...and then realistic...and then determined.

He offered to help me. We've lived together almost 3 years and have known each other for 5. We have a fur baby together. We have long-term plans and are committed to each other. Taking his money though felt like more commitment than I could possibly stand.

However, he had a strong argument - he can be very persuasive when he wants to be - and so I was just on the verge of accepting his offer when...

His job was severely cut back cutting his pay in half.

It was then I knew for certain I had to - not just for me but for him too. We're a team and I'm not pulling my weight. He's been smart - paying off all but his student loan debt and socking away money into savings hand over fist. I, well, haven't. He has an unexpected opportunity and I won't drag him down so he can't explore it. I'm in a perfect position to work toward this goal of ridding myself of this debt while still giving him the time to explore his opportunities and his passion, and I'm not afraid of it or even uncomfortable. I'm shocked to discover that, once I told him what I owed, I could easily tell you.

It is what it is.

And I have a plan.

Only this time, the plan isn't nearly so AW-FUL or painful or tear-inducing as the last. Because I have time and pleasant surroundings and amazing, supportive people in my life to help me navigate the emotional waters of becoming debt free in the land of debt.

Watch me.


  1. Focus on what doesn't cost much/any money that is available. Restaurant dinners? Pricey. Potlucks and picnics in the park (when it's warmer)? Much easier, and see friends that way. See if Neighbors Upstairs wish to penny-pinch by Going In On things that a 2-person household would take forever to go through. Modchen impresses me as a girl that could make the Lincoln squeal (she'd penny-pinch so hard) if she set her mind to it...

  2. *laughing* You, Dear Gavin, quite possibly hit the nail on the head with your description of Modchen.

  3. Well, you inspired me to further refine my budget tonight. Well done :)