Do you remember when you got your first credit card? How old were you? I remember when I was 20-years-old trying to get my first credit card so that I could build my credit. It was so frustrating because you can’t build credit without credit. No one seemed to want to give me a credit card. That was until I became a member of a credit union, and I was able to get one. I was so happy. I promised myself that I would use it wisely by
- not spending more than I could afford, and
- paying it off each month.
I did well keeping those promises to myself for quite some time. It wasn’t so bad because I only had one credit card with a limit of $500. But eventually I got another credit card; a store brand credit card. This is where my trouble began. I loved to shop; I still do, but I’m much wiser about it now. I would max out both credit cards and pay them off all the time.
Somewhere along the line, I got another credit card with a higher limit because I “needed” it. At the time I had a used car, and I was only working part-time while going to nursing school full-time. Anytime my car needed some work done on it, my parents or my then boyfriend, Omar, would help me. My way of helping myself started to involve using my credit card. Using credit cards for car repairs and especially shopping only led me to one place ———> DEBT.
In June 2009 when I was studying to take the NCLEX (licensing exam to become a registered nurse) I decided I needed to take a short break. I was going to go for some retail therapy. I went out to my (used) car that I had paid off in January. And guess what happened. It wouldn’t start. It wouldn’t do anything. Come to find out, the engine was dead. As if being stressed out about taking the NCLEX wasn’t enough, now I needed a new car.
I’m happy to say that I did pass the NCLEX. I also found a new (used) car, which I had to take out a loan for because I didn’t have the cash to pay for it.
I knew I needed to start getting rid of the credit cards because I was tired of having another bill to pay. The first one to go was the store-specific credit card. I paid it off and canceled it. For the next credit card, I did some balance transfers so that I could get 0% interest for a year. I ended up having to do a few of these because I couldn’t pay it off fast enough; it seemed like a never ending cycle. Before I could even get going good I had the perfect recipe for disaster ———> credit card debt + student loan debt + car loan debt + NO JOB.
In November 2009 I was jobless with a $253 per month car payment, plus car insurance; 4 student loans to payback; and 2 service cancelable loans to “work off”. I wasn’t able to help Omar pay our cell phone bill. Nor could I help my mom pay any of the bills I had been paying. On top of that, I had useless credit card debt with no job to pay for all of this stuff. Here I was with a Bachelor of Science in Nursing with my RN license, and I had to go back to my college job of being a receptionist at H&R Block just so I could pay my car payment and car insurance. To top it all off, I had to put my student loans on forbearance.
Fast forward to February 2010 and I started a new job as a RN. My credit card company decided to congratulate me. They sent my credit card bill with a late fee of $39 because I couldn’t afford to pay the $65.64 minimum payment. Why? Because of course I hadn’t received a paycheck from my new job. I refused to ask my parents for help to pay my credit card bill that was most likely from buying stuff I didn’t need. This is when I decided that enough was more than enough, and I had to get rid of this credit card once and for all.
Paying cash makes you more aware of what you’re paying for.
On March 9, 2010, I paid off the credit card… all $1,732.88. A week later I called and canceled it. It was such a relief to not have that hanging over my head. Even coming across the old statement the other day still makes me feel overwhelmed. What was I thinking back then?
After that, I had one last credit card to cancel. It didn’t have a balance on it, but it took me a couple of months to cancel it although I knew I wasn’t trying to get into credit card debt again. It was hard to cancel it because it was my first credit card ever; it was like my baby. Yet, I knew I had to get rid of it. And so I did. Canceling that last credit card put me on the road to getting control of my finances. That was the end of my credit card debt from that day forward.
Omar’s thoughts: I dislike credit card debt as much as Kim. If you’re interested in finding out my story in regards to why I wanted to be debt free, then check out this post.