1 Year to Debt-Free!

At this point next year, I will be something I have not been since I was 18 and received my first “You’ve been approved!” notice in the mail:  I will be completely and 100% credit-card-debt-free.

[Insert sound of my squealing here.]

That’s right:  on November 2013, I will be finished with my 4-year commitment to my debt management program and free of all credit card debt at the tender age of 31.  (Seriously, how many people in America can say that?)

The Long & Winding Road

It’s been a frustrating and impatient journey.

Four years ago, as my APRs kept soaring and we found ourselves with less and less left in our bank account at the end of each pay cycle, I realized that something had to be done.  It wasn’t one of those valiant “I shall make this right!” proclamations; it was more a back-against-the-wall, “Holy shit, we’re not going to be able to keep our house if this keeps up!” kind of decision.

Since we didn’t want to be totally credit-cardless for 4 years in case an emergency sprang up, and since I had the larger debt-to-income ratio, we decided we’d consolidate all the accounts under my name first, then work on my husband’s debt.  That way, he could still hold a few cards open in case we needed it.  (And we could keep our Kohl’s card to get the wicked discounts Kohl’s is constantly running for cardholders.)

So, taking the first step and admitting I had a problem, I signed up for a repayment program with Consumer Credit Counseling Service of Buffalo and prepared myself for 4 years of learning to live without my plastic crutches.

We failed quite a bit at first.  Since my husband still had cards open, it was tempting to keep using them for non-emergency “needs” like wanting to have a “nice” dinner for our anniversary or taking a road trip to see that band we’d Always Wanted to See So Of Course We HAD to See Them.  We also made the mistake of opening up a Target card figuring we always shop there, so it would be dumb not to get the cardholder discount on all our purchases.  Then we bought way more than we normally would each week (oh, the lure of “it’s only credit”!) and were only able to make the minimum payments, thus nullifying any minor savings we were getting at checkout.

I had to learn to reprogram myself.  It’s honestly taken me until this last year of the program to get to the point where I’ve got a credit-card-free mentality.  If an unexpected expense like a vet bill or a car repair comes up, I’ve trained myself to first think of how we can fit it into our budget—what other areas we can cut back on or what additional freelance work I can take on to cover it—rather than automatically putting it on my husband’s cards just because they’re “there.”  We’ve started paying more than the minimum on my husband’s largest balance to start the ball rolling until he can go through the program himself.

It’s taken us this long to get our finances (and financial mindset) in shape instead of merely focusing on the damage control of my payment plan.  But we’re here—and soon enough, we’ll be even further.

What Lies Ahead

I almost fell over when I read a recent post on Budgets Are Sexy entitled What Would a $40,000 Raise Feel Like?  The author was contemplating how much money a year he’d be saving once he got through his own debt management program, and it amounted to the equivalent of suddenly getting a $40,000 raise!

When I finish my program in November of next year, it will free up $420/month in our budget.  That, my friends, is the equivalent of a $5,040 raise.  (No, it’s not quite as impressive as a $40,000 raise, but I’ll take it!)

Once I’m able to open a card again (just one, strictly for emergencies and tucked safely in a drawer where I can’t easily use it), my husband will start his own debt management program to pay off his credit card debt.  This will most likely reduce our monthly expenses even further since monthly program payments are considerably lower than what you’d be paying directly to the cards if you weren’t enrolled.

Then, in 4 more years from that time, we will both, in our mid-30s, be a credit-card debt-free couple, with an extra lord-only-knows-how-much in the budget (and the bank!) each month.

Maybe enough to finally start that retirement fund we should already be building.

Maybe enough to take care of the roof the driveway the leaky basement in our current home—all paid for in cash.  (A concept that still feels kind of made-up to me.)

Maybe enough to do start doing what we both really want with our lives, instead of being enslaved to our current jobs because of the bad choices we made in the past.

One year from now, baby.  One year from now…

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