I don’t know about anyone else but debt makes me cringe. If I have to borrow money I usually try my best to pay it as soon as the extra money hits my account. I know, I know if you don’t have the money then don’t buy it. But hey, I’m human and American so I get caught up in consumerism from time to time. I can say most of my debt outside of student loan tuition came out of frivolous and wasteful spending. I am a shopper and it had gotten really bad at one point. I still shop from time to time now but it is nowhere near the shopping I was doing every weekend or almost every day. A good chunk of my student loan debt was taken out for tuition and to spend stupidly on items I didn’t need, in all honesty. Grab a cup of coffee and get comfortable, because this blog post is a little bit longer than the average one.
How I Accumulated Debt in College and Law School
My story begins as an undergraduate where I benefitted from Florida Prepaid College thanks to my parents and a ton of grants and scholarships. When I left undergrad, I am pretty sure I only had about $7,000-$10,000 of student loans. Yes, I still took out student loans because I was foolish and had no money management skills. I also had about $1,700 of credit card debt when I graduated from Florida State. I would give anything to have that amount of debt now! Fast forward to law school and the debt rolled in. At the end of law school (2013) my student loan skyrocketed to about $200-something dollars worth of debt. I know, it’s sickening and I get nauseous whenever I see the number. My current debt is about $258,000 in student loan, a car loan with a principal balance of $11,434.89, a bar loan of $1,658.42, and $4,612.59 of credit card debt. Yep, I am putting myself out there telling you guys these numbers, but I have to face facts so I can move forward.
When I moved to Washington, D.C. in 2014, life hit me pretty fast. In case anyone doesn’t know, the cost of living in that area is extremely high! I saved some money prior to moving but that money went out the door about a year after I left Florida. I was able to get a really cheap studio which I should have stayed in to save money but I decided to upgrade to a one bedroom apartment. My shopping habit was still full blown and I kept getting raises from my job. So instead of living the same way regardless of income, I kept spending more. I ended up getting a new car because mine was giving me so much trouble aka more debt but that was justifiable. I could have taken public transportation as DC is great with that aspect of living but being from Florida I was used to having a car and wasn’t going to let that go. While in D.C., I took Dave Ramsey’s Total Money Makeover but I didn’t take it seriously because quite honestly my student loan debt made me feel helpless. The only thing from Dave Ramsey I incorporated was Baby Step 1, which was an $1,000 emergency fund. In October 2015, I transferred my bar loan of $4,661.13 to a credit union loan. From 2013-2015, my $5,500 dollar loan was barely budging, which I realized later was due to interest. I was confused as to why the amount wasn’t decreasing when I was paying about $200/month. I only have $1,658.42 left to pay on it which is a lot more than the $900 it had reduced to from 2013-2015.
Two years later, my job allowed me to work remotely and I was able to move out of that area and move down to Richmond, VA. I moved in with my significant other and I had some breathing room to begin saving money again. Yet, I still wasn’t saving money and still had a ton of debt even though my rent budget was cut in half. Nine months later I had had enough! I had 3 credit cards with well over $5,000 on them, a PayPal credit account that had about $1,500 on it, my car loan, bar loan, and student loans which had been in deferment for two years while in D.C., gaining a ton of interest.
How I’ve Moved Forward
I have a credit score in the 700s and was able to get a 0% interest card until September 2018 from Citibank. I did a balance transfer from the three cards and PayPal credit account so now all of my debt is on one card and I am not paying interest on each of the other cards/accounts. My significant other and I have moved once again and he was generous enough to pay rent while I get my finances in check (and no I don’t think he should be the only one paying rent because he’s the man ::side eye::). I have been paying $750 monthly on my 0% interest credit card and it should be paid off by September. Fingers crossed!
This is a very short summary of where I started and I hope you continue to follow me and my progress, as well as tips that have helped me tremendously along the way. This blog isn’t about perfection, and I know I will fall short sometimes because I am human. However, this is a journey, right? So I’m hoping… NO, I willI conquer all the pitfalls, bumps, and missteps and come out living a debt free, autonomous life (putting positive vibes out into the universe so that they manifest!).