As I said in our first post, we’ve made a fuck ton of mistakes. It’s gonna take several posts to cover them all. Here’s the first, credit card debt.
When I was 18, and in college, I got my first credit card. I got it on a whim, without any forethought. They had been calling me weekly, trying to get me to apply. I worked full time in the summer, but during my first semester in school, my schedule was so fucked up, that I couldn’t work. So, after probably the 10th call, I finally applied. I thought, I’ll just do it, so they’ll stop calling me. They’d be insane to give me a card, and once I give them my information, they’ll realize it’s a waste of time.
They approved me immediately.
The limit was $500. It sounds insanely small. But to someone making $5 an hour, working some of the time, it’s a huge amount. We used it a couple times to go out to eat and paid it off immediately. Everything was fine. Until Christmas rolled around.
That year, I used the credit card to buy presents for my family. I was working full time over the winter break, and my second semester schedule was planned out far better, so I was able to work at least 20 hours a week once school started back up. I could buy some presents for my family, and have the card paid off in a month or 2.
I shopped without keeping a mental tab of how much I was spending. The card had a $500 limit. Once I hit it, no more shopping.
Except, they upped my limit in the middle of my shopping spree.
And I maxed it out.
Holy. Fucking. Shit.
It took me more than 6 months to pay it off.
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I wish I could say my stupidity with credit cards ended there. But for a while, when we were living with my parents, I needed to get away from my mother as much as I could, for my mental health. And for some reason, that lead to us going out nearly every night. Which lead to more charges on credit cards. Yes, plural. I had gotten another one by then. And the limits were even higher.
At the worst of it, we had racked up over $6,000 in credit card debt. And I can’t even tell you what we spent it on. I had dropped out of school by this point and was working full time, but I now had to pay rent at my parents house, and I had student loans to pay as well. It took us years to pay off the credit cards. And also started my love affair with spreadsheets. Once we got serious about getting out of debt, I used them to figure out the fastest way to do it, and also how long it would take.
I stopped using credit cards for the most part after that.* I had gotten myself into trouble, and never wanted to do that again, so I stayed away. It’s taken until now (2 decades later) for me to even think about using them again (a subject we will delve into in a later post). But for now, the take away is, never charge anything to a card you cannot pay off that month.** Period. And if you already have credit card debt you can’t pay off in a month, stop using them. My next post will talk about how to start digging yourself out.
More spreadsheets, nerds!
*The exceptions were a gas card that saved me 5% that I used for a few years, and a recurring $15 every 3 month payment for Sonicare toothbrush replacement heads (or something equally stupid), which got me into more trouble. In the age of paperless statements, I had a hard time remembering something had been charged to the card that needed to be paid for, so I was late paying it more than once.
**My math professor told our class this one day, about a month after my first credit card debacle. If only I had listened.