I can’t tell you how many times I went back and forth about whether to post this or not. Yikes. Here goes.
My weight is not the only thing I let spin wildly out of control in my life. You guys know I am a bargain shopper at heart, but what you probably don’t know is that I am still in the process of working myself out of a pretty serious financial mess. Let me enlighten you…
The Background
When I was in college, I opened up an innocent little credit card through an offer I got from being in the Golden Key Honor Society. There was a $2,000 credit limit on it and I honestly thought nothing of it and never even used it once. Then, after graduating from college and transitioning out of the restaurant business and into my first real job, I went through a rough time.
The Build Up
I ended up having to get emergency back surgery in September 2006 (another story for another day), and during my recovery, I found myself unemployed. I was looking for jobs for hours each day, and when I was not looking for a job, I was either going out to eat or drink with friends or online shopping, because I had nothing else to do.
Needless to say, without any money coming in and an excessive amount going out, I ended up almost maxing out that credit card in a very short amount of time, and Bank of America, being the charmers that they are, upped my limit to $6,000. I graciously accepted the “free money” they gave me by upping my credit limit, and kept that balance on my credit card for a few years, always making the minimum payment but never making too much of a dent in my balance.
But Wait…
Then, about two years ago, the bank that I actually have my checking account at suggested I open another credit card for overdraft protection, so before I knew what was happening I had a second card with a $4,000 limit. The original plan was not to put anything on the card, but you can probably guess how this one ends. And if you couldn’t guess, let me tell you – It ended with another 4,000 of credit card debt.
Around the same time, I opened an Express credit card because they give some pretty great discounts on clothes and good benefits if you have a card with them. I only had a $500 limit, so I figured there was little harm. They upped the balance to $1,300 very quickly, and before I knew it…
I had nearly $11,000 in credit card debt between three cards.
I had been in talks with financial counselors because I felt way in over my head with all the debt. My sister had also worked with me previously when I just had the Bank of America debt, and I was so embarrassed and ashamed that I had let it get to out of hand that I didn’t tell a soul. I called my credit cards asking them to reduce my APRs, and started paying way above the minimum balance, and I still wasn’t seeing much of a reduction in debt. It was SO hard to work my way out of the mess once the debt was already racked up, no matter how disciplined I was. I just felt way in over my head with three cards and payments each month.
Then, earlier this year, I read a series on Holly’s blog that really struck a cord with me. She came clean about having $35,000 in debt and getting out of it with her husband in about 2 years. Knowing that someone who had over 3x as much debt as I did and took care of it in under 2 years really lit a fire under my ass and made me want to take action, and quickly. Seeing someone as sweet and great a person as Holly come out about her debt made me realize that it didn’t make me a bad person, and that I needed to get this under control before it got even worse.
The Solution
I was already practicing very tight budgeting, but when I learned that finances are only 20% know-how and 80% discipline, I welcomed the challenge. I quickly got rid of the Express balance since that was the lowest by just paying the minimum on the other two cards and putting as much towards the Express as I could. Once that was paid off, I opened a new card and transferred almost all of the Bank of America balance to it with 0% APR for 12 months. I’ve now been aggressively paying off my debt for the past several months, and have managed to get it down to $6,500 from $11,000. Still a ways to go, but I am feeling extremely confident that I can get out of this debt by early 2012, if not before.
The Lesson
Money management and weight loss really draw on the same strengths. They both require a great amount of discipline and when you think about the big picture, it can feel incredibly daunting. When you instead focus on small steps and set up a concrete plan, that’s where you start to see real progress. I will also say that just like weight loss, seeing progress with my credit card debt gets me excited to keep going! It feels so good to finally feel in control.
Whew, putting this out there, albeit scary, feels oddly freeing. I realize it’s probably TMI, but sometimes when I write about budgeting with groceries and everyone responds and thinks I’m so regimented and disciplined, I feel like I’m keeping this huge secret, but now, the cats out of the bag.
Back to regularly scheduled programming tomorrow. 
By getting your health under control, have you seen other areas of your life fall into place? Are you a spender or a saver?
