Consumer Credit / Credit Cards
Even A Small Step Is Progress

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By Zoom03
May 12, 2005

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"I'm sorry but your card was declined."

It was a week before Christmas and I had run to the market to pick up a few items to whip up that lasagna I'd been craving the whole day. Total cost of groceries: $8. I hastily snatched up my debit card and slid over my credit card, signed the receipt and got out of there.

I've been told it's common to have an 'aha' moment. This was mine. How could I, someone who makes good money and owns her own home, not have $8 in her checking account to pay for some pasta and cheese? When I got home I pulled out my checkbook, fired up MS Money and stared at all the little numbers. I had tackled calculus when I was 15, balancing my accounts couldn't be that hard! Or so I thought. When the dust settled I found I owed just over $7k, and that didn't count the $34k I owed on my HELOC, which had been my 2nd mortgage when I bought my condo the previous year, or my car, another $10k. How?? I asked myself, as I slid on my Diesel jeans and grabbed my purse to meet my friends for dinner.

I would like to say that after that day I changed my spending ways, saw the light and started faithfully paying down my debt. All while strolling around in $200 jeans, and sipping on martinis over a $15 salad. Wouldn't it be great if getting out of debt were as effortless (and fun!) as getting into it?

When I was a child I always thought that being a grown up meant miraculously having the money to buy the things you wanted. We were, by no means, rich (actually quite the opposite), but there were never conversations about money being scarce, or needing to save. If we really needed something, it somehow appeared. Like magic! And I too, on that day I reached adulthood (in my mind, graduating from college), would learn the magic tricks.

Houdini, I am not.

I was going to have to do it the hard way. So here is my progress, to date.

Invaluable things I learned:

1) Breathe
2) Write everything you spend down until you know where it's going
3) Come up with a plan
4) Stop believing in things like fairies, magic, and free money
5) Yes, yes, it's unfair. Quite honestly, the world owes me nothing.
6) It takes time
7) Nothing's going to change until you change how you think

You know that gnawing feeling in your gut? The sweaty palms and sleepless nights agonizing over why and how? It goes away with a good spending plan. I've made a game out of mine. I plug in my numbers every morning and watch the different columns tally up. Right now it's telling me that I will be debt free in October 2006. Not exactly the forever it felt like a few short months ago.

February 2005

Card                %          Amount Owed      
BoA               24%          $1,414.46
Citi              22%          $2,200
Wells Fargo       16%          $1,669.96
Credit Union       8%          $450
Car                6%          $10,500
Total Debt:                    $16,234.42

Total Savings:                 $0
It was obvious to me, back in February, that life would never be fun again. I was going to have to scrimp and save and forgo all the joys I'd become accustomed to. Oh the unfairness of it all! I took a vacation. Yes, the debt went up. Like an addict who has fallen off the wagon, I was really only going to charge one thing. And I was going to pay it off at the end of the month! Honest!

I chucked that savings plan, the one that made me feel like I was drowning in mud. I locked up the cards. I started from scratch again. I'm happy to report that for the last two months I've made progress. But even beyond that, I am UNDER budget for the last 2 months for just about everything that is not a fixed amount.

May 2005 (I originally miss calculated on some interest rates in Feb. and BOA went up)
Card                %          Amount Owed      
BoA               29%          $2,881.58
Citi              24%          $1,793.94
Wells Fargo       18%          $1,896.95
Credit Union       2%          $445.47
Car                6%          $9,314.93
Total Debt:                    $16,332.87

Total Savings:                 $1,300
My debt went up a little ($98) but I now have $1,148 to throw at debt payments a month, and $1,300 in an EFund. The spending plan is doing nicely, allowing me things like clothes and travel and eating out without being ridiculous. And the strangest thing of all? It's actually starting to be a lot of fun!

looking forward to 2006

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