First of all, let me just say, if you’ve ever
a) Gotten yourself into a deep, seemingly insurmountable financial hole,
b) Thought about declaring bankruptcy to ease your financial issues, or
c) Struggled with debt, budgeting or money in general
I feel you. As the young kids are saying now, “same”.
I felt like it was important to let all of my readers (potential readers? Non-existent readers…?) know a bit more about my financial past. The same past experiences that led me to start this blog!
About 6 months after I turned 18 is when I moved out of my parents’ house. Not a happy move out, but a messy one. As are all 18 year olds I was bullheaded and sure that I knew what I was doing with my life in general. Of course, my parents knew I was wrong about this (and I pretty quickly figured it out as well), so it came down to me shaping up or shipping out. I took the latter option, moved into my first apartment after 2 weeks at my first full-time job ( as a fast food shift manager), and launched my career as an “adult”. *insert eye roll here* Working in fast food isn’t the most lucrative job, even as a manager, so the first financial move I made was to get rid of insurance (health and car insurance). Big mistake numero uno (of many). The first 4-5 months of being on my own were…depressing, to say the least. Guess what? Not having money can really suck.
Fast forward to the end of May, 2011, me working at a location about 40 minutes from my home. As I was taking a friend home from work, I failed to yield at a green light and my sweet Volvo station wagon was demolished. Big mistake nombre deux. (See a pattern here…?) I got out of my little Volvo and cried on the sidewalk while crowds gathered around the accident, not because I was hurt (thankfully!), but because I knew I was in some serious crap. Let’s refer back to mistake number 1- getting rid of insurance. Add that to mistake number 2 and you have a grand total of roughly $15,000 worth of debt. Which for an 18 year old, with no college education, working in fast food and fully supporting herself financially seemed IMPOSSIBLE to overcome.
Fast forward again, this time about a year later, summer 2012. I had spent the last 12-ish months avoiding- avoiding mail, phone calls, my guilt and fear about my debt. FYI- running away from your debt is NOT a real solution!!! When I finally started answering phone calls, reality quickly set in. The opportunity to settle my debt for a smaller lump sum had passed (not that I would have been able to swing that financially anyway). Now I had to set up a payment plan as soon as possible or risk and even larger portion of the accounts going into collections (yes, ACCOUNTS, plural! Yes, some were already in collections!). The first payment plan I set up was with the insurance company of the other driver involved in the accident- $75/month til I paid off the roughly $10,000 balance. Assuming no more interest or legal fees, paying that off at $75/month would have taken me ELEVEN YEARS.
I came to the realization that 1, my debt wasn’t going anywhere and 2, the best way to get rid of it was just to start paying it off .
Over the next 4-5 years I gradually increased the amount I was paying to the insurance company and began paying on the other $5,000 worth of medical bills that were in collections. It took me until I was 24 years old to pay off that $15,000 and call myself debt free. Let’s be real- $15,000 may not seem like much and 5 years isn’t a very long time, but at a young age and having just started out on my own, it looked like the Mount Everest of debt. I had people I loved telling me that “maybe bankruptcy is the best option”. Bankruptcy- at 19!!! What a great start that would have been!
Fortunately, I didn’t take that route and paying off $15,000 in 4 ½ years (versus my initial 10+ year timeline) was sooooo satisfying and empowering!
That feeling of empowerment that I felt, and continue to feel, is the reason I KNEW that I had to start writing this blog. I needed to share my story and help others, if I could. I’ll probably refer back to this story many times in the future because this experience changed my entire mindset about money. It also gave me a rad sense of self confidence! If you find yourself in a similar predicament or facing odds that are NOT in your favor, trust me when I say that you CAN do it.
And it is so worth it. 🙂