Be Honest With Yourself

When I graduated from college, I left campus with a diploma and four figures worth of credit card debt. Shortly after graduation, I landed my first job out of school and took it upon myself to add in a car payment for a brand new car. In addition to that, it was only a few short months later and the payments on my student loans kicked in.

No big deal, right? Not quite. Unfortunately, at the time I didn’t realize it and thought everything was just fine. After all, I had a good paying job for being right out of school and received a $5,000 per year increase after 3 months on the job. Things were good and I kept telling myself that everyone carries a little debt, it was no big deal.

Digging Deeper in Debt.
It didn’t take long and I began to realize that my level of debt was hovering around the same amount or even increasing slightly. Still, I kept telling myself that things were fine and I could pay off the debt whenever I decided to do it. As I am sure you can imagine, that is not a recipe for success. As the months went by, I continued to spend a little and then pay off a little, only to spend a little more. Similar to the yo-yo diet, I was on the yo-yo credit card balance. Unfortunately, much like the yo-yo diet, when I would spend again I always seemed to spend a little more than the last time.

Facing the Truth.
After continuing to work my tail off and receiving a few additional raises, I began to question why I always felt like I was struggling to make ends meet even though I was making decent money. All this time I was lying to myself and living above my means, which was only making my debt levels increase.

Sure I always told myself that I would start paying more towards the credit cards and would put together a plan to eliminate my debt. One or two months would go by and then I would let those plans fall to the side and resume my bad habits. It wasn’t until I stopped lying to myself and admitted that I was in debt and needed to do something about it that I had finally turned the corner.

Power of a Snowball.
On January 11th, 2002 I discovered the snowball spreadsheet that would forever change my life. In all reality, it wasn’t so much the snowball spreadsheet but the fact that I had come to terms with the fact that I was in debt and calculated up the true damage. Once I saw the numbers staring me back in the face, I felt embarrassed and ashamed that I had let it get that bad. But I also felt a new sense of power and determination to eliminate that debt.

$25,237.19 was the number staring back at me. That total included the credit cards and the remainder of my car loan, but did not include my student loans. As scary as that number was at the time, actually seeing it in front of me was the hard slap of reality that I had been hiding from for years. But now I had the knowledge and plan to begin my journey towards being debt free.

Working the Plan.
Armed with a detailed plan courtesy of the snowball spreadsheet, I began to attack my debt with fervor. At the time, I also had the good fortune of landing a very lucrative job and that certainly helped expedite my plans. On that cold day in January, I had finally stopped lying to myself and took the time to honestly assess my situation. The process of creating my debt elimination plan was like making a binding contract with myself, I vowed to change my ways and eliminate my debt.

Moving forward a little more than 5 years, I am proud to say that I no longer pay any interest to the credit card companies. On the contrary, I am using the credit cards and their 0% balance transfer offers to make money.

So what are you waiting for? You owe it to yourself to stop playing games and be honest with yourself!