$30,000 in credit card debt
“In no world can I afford any of this”, I’d think to myself.
I remember the feeling distinctly. The drop of my stomach, like being on a roller coaster as I realized I paid too much towards my credit card for the month. “Too much as in, doing the math wrong and auto scheduling to pay more liquid money towards my ever-growing credit card balance than I could afford for the month. I would be leaving just dollars in my checking account after paying my astronomical San Francisco rent. At the time, I was comfortable with a few hundred in my account, just in case. You know, in case I needed to go on a trip with my friends next weekend, and be able to Venmo for car rentals, Airbnbs, and groceries. I’d often offer to buy things in bulk for the group, or pay the tab at the restaurant, so I could put it on a credit card. I’d have them all Venmo me, rather than run the risk of not being able to Venmo my owed amount for the weekend because of a lack of funds in my checking account.
“She loves the points!” they’d say.
I remember getting my first credit card. My dad, very practical and fiscally responsible gave me this advice; “always pay your balance and never charge more than you can afford”. I was given the card my senior year of college, after my study abroad program (which is probably a good thing). While I was on that trip, I blew through the account that I had set aside for trips and fun. It was the first time I wasn’t working, or bringing in any money to my account. I was just spending and spending, with no attempt to budget. With about 3 weeks left in my program, I could tell that I was going to get near the bottom of my account by the time I got home. I had a job lined up back on campus, but I wasn’t going to be making much. I wasn’t even sure I had enough money in my account to get home at the time. A week before my trip back I was skyping with my family and asked my dad if he could put some money in my bank account. He told me to call him if I got into an emergency situation, but until then I needed to figure it out. I had no credit card to fall back on, so for this time I figured it out.
In 2014, I decided to move to San Francisco. I was running away from a lot of things. I look back now and see so much of these next 3 weeks as mania, but at the time it could all be explained away by someone who was young, untethered, and excited to explore the world.
I went to visit my friend Jasmine for a long weekend, and on my last day in town, I decided that I would be much happier if I lived in California.
I took the first job I was offered, just a week later. It was an entry-level position with Yelp selling advertising to small business owners. I’ll be honest - I didn’t crunch a single number. I remember sitting in my parent’s kitchen looking over the job offer and my dad saying to me “Emily, I don’t know about this. You’re essentially keeping the same salary that you have now, but tripling your rent. It doesn’t seem like it will work out.”
“Dad! They hire 50 people every month! I’m going to absolutely crush it, and make a ton in commission. I just have to work hard!”, I quipped back.
On day 1 of my training I realized that of the 53 people in my starting class, I was one of just a few who were living in the city and paying their own rent. Most of my colleagues were staying with family outside the city, taking hour-long train rides - as many do in the Bay Area. I was living with three close girlfriends, who were all making nearly three times as much as me. The numbers didn’t make sense. But a credit card with a $36,000 balance on it seemed to solve all my problems.
It was 2 years of drowning in expenses and deciding that if the balance was always big, it didn’t necessarily matter what the balance was. I paid as much as I could each month and then went through the cycles of not eating out, followed by multiple meals out a day for 2 weeks. By the end of 2016, I decided that more than anything, my $1,850/month rent for my bedroom was the biggest culprit in my drowning debt. I started working towards a plan to relocate back to the midwest and hoped to get my finances under control.
When I first moved back to the midwest I didn’t live anywhere for 7 months. Tuesday mornings I would take the train down to Chicago, and stay with my friend Linda until Thursday, sometimes Friday. Then I would train back up to Milwaukee and spend the weekend at Tony’s. I’d work from my parents every few weeks and do a load of laundry, or swap out some clothing from my ‘home base.’ The idea was to essentially ‘save’ $1,850 a month in unpaid rent. Pay off nearly $2,000 of my credit card debt every month.
Fast forward to October of 2018 and the 5 days leading up to my hospitalization. I had gotten my credit card debt down from the peak balances in the $30k range to about $6-7k depending on the month. As my brain continued to ramp up and I had exciting ideas for how I could potentially make it big, I decided to head to the Apple store and buy myself a laptop! I hadn’t owned my own computer since my college days, and just because I had been fine with a work computer all this time, I suddenly needed my own personal device. Fifteen minutes, and $1,400 later I was feeling lighter than a cloud as I walked out of the Apple store. I headed directly for the AT&T kiosk, and within another 30 minutes, I was the proud owner of a new iPhone - purchased outright. Almost $2500 charged to my card in under an hour just days before my hospitalization.
I was discharged from inpatient with my balance back up near $10k.
For over a year after my diagnosis, there were bigger fish to fry than my credit card debt. I was able to make substantial payments every month, but I continued to eat out frequently and get my nails done often. It wasn’t until April 2020 that I really took a look at my finances and tightened my belt. As all of my teammates were either laid off or furloughed, my panic and anxiety reached all-time highs. What on earth would I do if I lost my job? The debt that I continued to carry over was only unconcerning because I could make hefty payments each month. Because I have a paycheck coming in that now covered my expenses and a solid chunk more. I’m in a stage where I could have battled back the rest of the debt, but I had chosen not to. Living paycheck to paycheck is a reality for so many people, and my experience made me even more aware of my privilege. Many of my friends and colleagues are still paying off student loans, and fighting financially just because they chose to get a college education.
May 2020 I took a hard look at my credit card statements and verified what I already knew. I eat out too much, I enjoy Target too much, and I own enough books for the next 2 years. I was determined to eliminate my credit card debt and finally take control of my finances. I wanted to eliminate the constant uneasiness that I have when I move money around and pay my bills each month.
Here we are in March 2021 and I can happily say I am credit card debt-free. Last month I paid off my final balance, and I currently have $0.00 on all three of the credit cards in my name. I’ve been saving money and cooking at home more, and it honestly feels really really good. I still treat myself from time to time. I get my favorite candles, and I make more than one K cup most days, but I don’t order carry out 5 nights a week, and I haven’t spent $500 at Target in over a year. I’m aware that at any point I could have an expensive car emergency set me back or heaven forbid I ever struggle with coverage for my monthly medication like I experienced earlier this year.
Financial freedom has always been a goal of mine, and when I was given my diagnosis, the connection between my mental health and spending became abundantly clear. Sure, I got behind when I decided to live in one of the top three most expensive cities in America, on an entry-level salary, but I also have a tendency to spend when I’m hypo-manic, and also enjoy spending when I’m down. I think we’ve all experienced retail therapy a time or two in our life, and it’s enjoyable most of the time! But having a growing balance in my savings account, rather than on my credit card, gives me a calm and confidence that I didn’t even know was possible before I got my finances in order. Sometimes I find myself thinking about the future of my finances, and there are days I worry about being hypomanic and spending a few thousand dollars in an afternoon. I try to put guard rails in place to protect myself like a 401K and roth IRA, but sometimes life happens. For now I’m enjoying the feeling of accomplishment for paying off my credit cards after years of carrying over a growing balance month to month. But I wonder, is this something I can continue to keep up? I hope my finances aren’t destined for a roller coaster future, but life has a way of springing up surprises. This week I’m saving by eating at home a minimum of 5 nights, and having breakfast foods at home. What are some tips that you use to stay balanced financially?
