Not going to lie to you, I could have been debt free 3 years ago.
I was blessed to make a great profit on my house sale and paid off my student loans . That’s the only debt related thing I did. Should I have paid off my credit cards…yes. Did I? Nope, I didn’t even think about those things. I was treating myself to a brand-new car instead. (In my defense, my then current car was an ’05 Corolla with no AC). So, I got a car that was way too expensive and set out to live life paycheck to paycheck, again, while racking up even more credit card debt along the way.
3 years later and I am kicking myself in the face for not being proactive. But the past is the past. I’ve got to suck it up and start from scratch. So here’s the plan to get debt free:
1. Deep dive into those credit card statements:
I know it can be scary, tedious, and overwhelming to do, but it must be done. See, right now all I see is a few giant numbers that hang over my head each month. I had to break that sucker down and SEE where all those nonchalant swipes were going towards. Amazon was my enemy and SHEIN was not far behind. And I like to eat out apparently, even with food at home. Then I realized the scary part, those purchases were online, so they don’t even require a swipe, just add to cart and pay now. There goes $23-$50 here, $45-$84 there…adds up to that big old’ number at the end.
I had to print out the last 3 months of statements for EACH credit card. Took out my highlighter set and got to work. Pink for food, Yellow for Amazon, Blue for SHEIN, and Green for bills. Yes, I have some bills on my credit card (don’t yell at me, I’m working on that part).
2. Create a chart for each deep dive overview:
Next, I used Excel to create a spreadsheet. It was simple: I listed the card, the annual percentage rate (APR), the minimum payment, and the total amount due. As simple as this part was, it was the most jaw dropping. Seeing all my credit cards listed side by side brought it into perspective. I had made a mess, and I needed to clean it up as soon as possible.
3. Show yourself GRACE.
After I realized where I truly was financially, I had to stop and show myself grace. Things happen, life gets hard, and sometimes cash just isn’t available. That is okay. We have acknowledged where we are at, and I now have tools to get myself on track to debt freedom.
4. Payment Plans and other options
Now here comes the tough part. How am I going to get these credit card amounts down? There are a few options I have come across during research. Not every option is for every person so do your own research and see what will work best for you personally. Don’t y’all come blaming me for nothing, these are just suggestions.
-Personal Loans: If my credit card debt APR is extremely high, sometimes you can get a single Personal Loan for Debt Consolidation that will put you in a lower APR than your credit cards. This essentially creates more debt (because you must pay back the loan) BUT if you do it right and pay off your current credit card debt with that Personal Loan, then you will set yourself up to be ahead. You end up with a single loan to pay back at a lower APR. Just Don’t put ANYTHING else on your credit card, cuz that defeats the purpose of paying them off.
-Financial Hardship on each Credit card: Some credit card companies offer a Financial Hardship program. You may have to call the company to get the details as every card is different. Essentially you call in and advise you are having a hard time paying off your cards, they can lower your minimum payment for you that will allow you to pay off your card. The catch, your card is locked, and no other purchases can be made on said card until the balance is paid. Another catch is the due date. Say your new lower payment is $97, if you put down $200 one month, your monthly payment is still due next month, extra payments do not push back the due date to next month.
-Discipline: This right here takes WORK. I have heard of people cutting up their credit cards to get debt free, I don’t have that much courage, but if it works for you go ahead. If your cards are still stored online, REMOVE THEM. Paying above the minimum payment each month, putting any bonuses, birthday money, or Overtime towards the cards. Not putting anything else on the card as you pay it down is the key to getting this thing under control.
So, all in all this is a process that I am still working on. It’s a winding road but I plan to stay on it until I can say I am debt free. There’s no quick way to do it unless you come into a financial windfall, if so shooooot go ahead and get that debt paid. But for the rest of us, it’s a one step at a time type of process. Be diligent, ruthless, and in the end it’ll all be worth it.
-Adele-
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