Yesterday was a momentous occasion, a freaking scream-from-the-rooftops miracle: after working toward it for years, I made the final payment on my student loans, and became 100% debt-free.
I still don’t quite believe it myself.
My debt was made up of common damages: credit cards, a car loan, and everyone’s favorite, student loans. I was 17-years old when I decided to go to a private university, therefore sealing my fate as an indentured servant from graduation on. Borrowing money for school led me to feel justified in borrowing money for other things (“What’s another thousand? At this point, it’s just a drop in the bucket”).
Thus, my entire adult life has been spent owing.
Just about two years ago, my 21-year old Honda Accord rolled to a final stop on the side of the highway just outside of Kansas City. I had no money in savings, and could only laugh when the salvage lot paid me $251 for parts. I had a $2,000 credit card balance, $17,000 remaining on my student loans, and found myself borrowing $8,500 to buy a used car. All of a sudden, after 6+ years of paying the minimum monthly amount on my student loans, I was basically back to owing the original sum I did in the beginning. In other words, in 6+ years, I had made no progress.
Maybe it’s tacky to give dollar amounts. Maybe you read those numbers and think, “Wow, that is a TON of money” – or maybe you read them and think, “Come on, Annie – that isn’t so bad.” The point is that the sum was much more than I was comfortable with, more than I was able to fathom settling – and I had no idea how to get myself out of the mess I had gotten myself into.
Around that time, I started listening to the Dave Ramsey Show. I’m sure there are other financial gurus out there with valid get-out-of-debt plans, but Dave is my guy, and I think he gives solid, common sense advice. I loved when people would call in to the radio show to tell Dave they were finally debt-free, and was sometimes moved to tears as they shared their stories. Some of these folks had more debt and a smaller salary than me. Some of them were single women like me. I started to realize that actually, mathematically, I could do it: I could get myself out of debt.
However, when it came to following the Dave Ramsey plan, I had a bit of a slow start. I spent about a year trying to pump myself up, listening to his show and reading his books but only kind of following the steps. I moved in with my mom for 3 months, built up a $1,000 emergency fund, and started the debt snowball. But I continued to overspend each month, making it so I could never quite pay off the credit card – because I NEEDED to fly to Nashville, or I NEEDED to have that dress from Anthropologie, or I NEEEEEEEDED to have whatever I wanted when I wanted it. I could write an entire book on how this “neediness” is nothing short of a disease. It’s a contentment killer, a sabotager of joy, and a dream stealer – because as long as money is owed, certain dreams have to be put on hold.
And this past February, I had finally had enough.
I knew that I had to “stop the bleeding,” and there was only one way how: I drank two glasses of white wine and took scissors the plastic. And when I realized that I had no backup plan – no way to buy something unless I had dollars for it right then – I stopped buying shit that I didn’t need. Simple as that.
That’s when my debt snowball really took off, first paying off the credit card, then my car. When my student loans were the only thing left, I upped the payment from $200 to $300, and a few months later, I said “I’m over it” and bumped it all the way to $1,000. One thousand dollars every single month on a single girl’s not-gigantic salary. This was the most fun, because I watched the digit drop every month, $10,000, $9,000, $8,000, just like the New Years’ countdown.
Speaking of New Years’, my 2013 will contain zero debt.
Again, maybe you think it’s tasteless to talk about money – and who knows, maybe it is. But I’ve become very passionate about being debt free, so I’m throwing caution to the wind and writing about it – because I want other people to know that YOU CAN DO IT. If you are up to your eyeballs in debt, and feel like there’s no end in sight, and that you will spend your entire life paying for decisions of the past, I’ve been there – and I’m here to say that THERE IS HOPE.
And the feeling I have today is worth everything that it took.