When you get in debt you become a slave.
Andrew Jackson
I’ve always been a spender. As a kid, I can remember counting coins every week so I could buy a donut from school on “donut day.” Literally every cent that came into my possession was immediately directed towards something I could buy.
As a teenager I started getting an allowance – $20 per month to do whatever I wanted. Most months, it was gone by the 10th and I was left with nothing for three long and tortuous weeks. My parents – being the kind souls they were – would allow me to do household chores for extra cash, so every once in a while I would do a few loads of laundry (for $2 per load) in order to tide myself over to the next month.
At 17 I got my first job. I was so determined to get a car that for the first time ever I forced myself to save. By the time I graduated high school I had used every cent I’d saved, about $1100, to buy… my dad’s old car. He definitely was using it as an excuse to buy himself a new car – I think I paid half of what the car was actually worth.
Then along came college. I was lucky enough to have had parents who saved for college, so my state school tuition, dorm room, and meal plan were paid for. Everything additional I had to take care of. Over the summers I got a better job (a whopping $10 per hour) working in a warehouse. Of course being me, instead of saving my money for the school year 90% of my income went towards whatever took my fancy that week. $300 purse? Yes please!
Despite my lack of saving savvy, up until this point I never went into debt. I thought I was doing pretty good, getting through college and only spending what I had. But then… study abroad happened.
I remember getting home from four months in Europe and realizing that I had overspent my credit card by almost $2000. It was the first time I ever had to pay interest but I thought I would be able to pay off the debt by the end of the school year.
Unfortunately for me, I couldn’t find a job that fit my school schedule that year and my summer internship was unpaid. I was making minimum payments and my credit score was going up, so I thought I was doing fine. I got another credit card from the store where I (finally) got a part time gig, telling myself it was so I could get the coveted 5% off groceries. It wasn’t long before I had another card balance to deal with.
I deluded myself by thinking I would get a nice, decently salaried job as soon as I graduated – but graduating in 2012 meant that there wasn’t much available. I moved back home, continued my retail gig, and started slowly – and by that I mean glacially slow – paying down my credit cards.
Six months after graduation I had the opportunity to take a part time gig in my chosen field, but it meant that I needed to find a place to live in my college town, which most of my friends had already moved away from. I paid $300 of my $2000 2-month income to sleep in an honest to god closet. (We called it my Harry Potter phase.) I spent a lot of time in the office and ate out almost every meal, so by the time I went back home I just about broke even.
This job was the first time I learned the perils of 1099 independent contractor jobs. (Yes I mean the first time – I learned it two or three more times before it finally stuck.) Just be wary whenever you’re asked to do an employee’s job but they won’t pay any of your taxes.
Fast forward another 6 months of unemployement. I was flat broke, using the little money I could get to make minimum credit card payments, and racking up the interest. What better time than to move to the expensive city of Los Angeles – 300 miles from home – by myself, on the whim of an unpaid internship with a YouTube channel. Sounds like a great idea, right? Then mix in the fact that the only part time job I could find that was flexible enough to work with my internship hours was another independent contractor position that paid about $1000 per month. That’s right – total monthly income = $1000.
I was racking up more and more debt every month.
By the time I realized what was happening, I had $10,000 on my credit cards and nothing in the bank. I quit my independent contractor job, drastically reduced my internship hours, and got a part time minimum wage job at a theme park. Not my finest hour, but at least they took out taxes.
And that, my friends, is how I got into debt. It started with Italian wine and European trains and got worse with poor budgeting and an “I can make this work” attitude that was totally unrealistic. While much of that debt has now been paid off, there is still a bit more to go. I look forward to sharing more of the journey in the days, weeks, and months to come.
What is your debt story?
