My life with debt has seen its ups and downs. When I got out of college, one of my first big purchases was a used car. It cost me $6,000, for which I took out my first auto-loan. Of course, with little expenses1 and a full time job, I was able to repay the loan in six months.
From there, it was just playing with investing and saving money. Sure, I had a credit card, but I never carried a balance. If you were to ask me then, “What is a Good Credit Score?” I could assure you I had one.
I then got married and assumed some debt on the honeymoon—which I promptly paid off. She had some college debt, but that was paid off before the arrival of our first child.
We were the typical couple—we’d put Christmas on credit and then pay for it in January. We knew we should have some money saved, and we did buy some of it in cash, but we usually bought more than we had cash.
Over the next few years, we had auto loans, and actually took out a 401k loan once, before, in 2005, we decided to get out of debt after reading Dave Ramsey’s Total Money Makeover. We cut back on our expenses, even cancelled the cable modem for Internet for a little bit, and worked on getting out of debt.
We stayed out of debt until the Summer of 2010, when I needed to sell my house to come back to my hometown to work. We put the loss from the sale (we’d only been there 1.5 years) on a card with 0% and went about paying that off. And we would have, too, if it hadn’t been for the fact that the house we were renting was not going to be available for another year.
So, that means that we had to move again!
When you factor in a surprise visit to the ER, Christmas around the corner, and moving expenses, you find that you don’t have the money to pay off your original debt.
To make matters worse, it seems that the company that I work for always seems to let people go around the holidays—probably something about the fourth quarter. Hearing the possibility that I might not have a job, I started wondering about how I would get buy if I still gave a lot of gifts at Christmas?
It’s never a good strategy to be in debt, but Christmas time is the worst time. You’re not giving of yourself when you do it, you’re giving someone else’s money/gift and you’re enslaving yourself to that other person to pay it back. And because you don’t know the future, that extra $100 or $1,000 that might seem so needful to make your kids smile mean that you have a hard time putting food on the table if the economy catches up with your job—which it could do.
While you’re thinking about money, gifts and debt this season, check out CashMoneyLife. There are good articles over there, and you can learn a lot, but most of all, get out of debt. It’s a burden no one should have to bear!
- Living at home until I was married