On Being Debt Free

No credit card debt

This is a good feeling!

Having debt sucks! Last year at this time, I had $2600 in credit card debt, $1300 that I still owed on my ridiculously amazing laptop, and several thousand on an auto loan.

In the last year, with a part-time job and being full-time in school, I paid off all of my credit card debt, my laptop, and about $3000 on my auto loan. I accomplished it by changing my priorities, getting a part-time job, cutting down my expenses, selling most of my belongings, and living frugally. It’s a good feeling to be pretty much debt free.

I know that $2600 isn’t a lot of credit card debt, but it hangs over you like a crowd of menacing clouds, and even a small amount like that sucks up interest, and it takes a long time to pay off when your income is limited. At the time, I was spending a lot of time on an entrepreneurial endeavor. A colleague from a former job and I were trying to make a go of it selling Amish furniture online. Like all startups, it took a lot of time. Unfortunately, the sales were not yet at the point where it could support our lifestyles, and so I supplemented mine with credit cards. It’s an investment, I thought. Once the sales really start rolling in, I’ll be able to easily pay of the credit card debt that I used to buy food and pay bills.

Then last march I made the life-changing decision to pursue a college degree. After several years of babying our company, always believing that huge sales were just around the corner, I decided, essentially, to cut my losses. I’m still a partner in the business, and it’s actually doing pretty well at this time, but the commission checks we pay ourselves are nowhere close to covering life expenses. Besides, I’ve always known that I don’t want to do online marketing for the rest of my life–it just doesn’t exhilarate me like studying math and science does. Although I’m still considered a partner, I don’t put much time into the business, and it’s not on my list of priorities for the future. Making the decision to pursue a degree forced me to face reality, and find an alternate source of income.

Now I mow lawns. Seriously. I maintain forty or so lawns, I trim trees, bushes, and hedges on the side, and sometimes I fill in for another lawn care company. I work about 2-3 days a week, and last year I made between 15k and 20k doing this. It’s  not much, but by cutting my expenses, and living frugally, I was able not only to survive, but actually to pay down existing debt. It helps that for much of the year I can live rent free by “house sitting” a relative’s winter home. I don’t like mowing lawns. After years as a white collar worker, it hurts my pride. Sometimes, pride just has to be swallowed for the greater good.

My ridiculously amazing laptop was also one of those “investments”. I thought I needed it for the business, and the manufacturer allowed me to purchase it for monthly payments of $30 or so. The interest was high–like 30%–but I figured I would have it paid off within a month. It took most of a year. Now I know that I don’t actually need an i7 processor, a backlit keyboard, and an extra-large battery. Live and learn.

As for my auto loan, I’ll have that completely paid off in a few more months. I purchased a nice, used SUV about a month before I got laid off from my well-paying job (three years ago). I had money, but my girlfriend (fiancee now) and I were heading to Switzerland for a vacation, so I decided to take out a loan on the vehicle and wait to pay the rest until we were back from Switzerland. Life had other plans. We cancelled the Switzerland trip and swallowed the $1500 or so in tickets we had purchased. I just didn’t feel comfortable going without a stable income. Two years later, all of the money I had planned on using to pay off the car had been spent on food and other bills, and I was falling back on credit cards while we were trying to get rich selling Amish furniture.

Now, two and a half years later, my SUV is almost paid off. I haven’t taken out any student loans–those will probably come when I transfer to a university. As of right now, I am essentially debt free, and it feels great.

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