I hate debt. Our family experienced a hardship a few months ago in the form of a car crash last October. We are all healthy and well, which I am super thankful for, but our finances took a hit and it’s been a hard battle getting back on top again.
My husband and I usually never carry credit card balances, but we have $3,000 worth of credit card debt right now and it is really weighing down on us. Not only are we stressed out, but we feel a bit hopeless. I feel stuck on a hamster wheel of work, work, working toward paying it off and yet we’re not getting anywhere.
There are a few unfortunate circumstances and mistakes that have put us in this position.
First, of course, was the car crash. We lost the value of the car we crashed, we had to pay towing and other varying reparations, and we had to buy a new car. That totaled at about $9,600. (Ugh, it’s painful to see it written out here.) That wiped out our meager savings and then some.
Then, it was Christmas and the whole holiday season in general. I’ve been trying to figure out a way to get comfortable financially during that time of year and I just can’t seem to manage it. We don’t spend a lot on gifts, but we do get some things. Like, I bought the clothes Wingnut and Pigpen needed for Christmas because I still feel this obligation to have something under the tree for them (I want to get rid of that nagging feeling of duty). We get a tree, we go to parties, we go out with friends. It’s a season of celebration and it cost us money. Money we didn’t have.
Next, Andrew and I needed some clothes, too. He really needed new sneakers. The soles on his old ones were smooth with wear and his socks got wet in the rain. So we went shopping. I also bought some clothes I “needed”. That is in quotations because I did kind of need the stuff I bought. I am wearing them all now and getting tons of use out of them. I am very happy and satisfied with the purchases. The only problem was: we bought them on credit. I bought these wonderful pieces of clothing without the cash to do so. And if I am really truly honest with myself, although my old clothes were uncomfortable and deteriorating, I really could’ve gotten by without buying new. The old stuff was falling apart, but it was still keeping me warm.
The anxiety I’m feeling now, makes me wish I was more discerning then. But then that’s the problem with credit — it’s easy to justify purchases because it’s so easy to swipe the card. We can afford this swipe and this swipe and this swipe, but not all these swipes together. Because even if the purchases are perfectly legitimate, we still didn’t have the money to buy them. And I don’t know, that makes me feel poor.
And now I get into the controversial bit. I really don’t think I’m poor because we have a house and eat pretty well and have an annual income pretty dead-center in the average range for middle-class households of 3 in New Jersey (although we are a household of 4). But when you calculate in our debt, it starts to look a lot more dire.
We already paid off about 50% of our student loan debt, which is awesome. But the remaining balances are 71% of our annual income, which is definitely not awesome. They come out to be 26% of our monthly budget. Our mortgage is another 25% of our monthly budget, leaving less than half for all other living expenses, like food, heat, and transportation. Which brings our annual income clearly below what is considered middle-class, but still not technically under the federal poverty line.
Truthfully, I grew up comfortably middle-class, maybe even upper middle-class, and I’m just not used to saying no to a new coat when my current one is falling apart. But this winter, that’s how it’s been for us. It’s a personal experience and it hasn’t been pleasant for us. We’re stressed and despairing. I believe that we will get out of debt, but the wait is excruciating. I’m hoping to at least get these credit cards paid off within the next month or two and I hope that’s realistic because I really, really want it gone. Then it’s back to work building up our emergency savings before we can even think about tackling any more student loans.
Having debt sucks. I want to feel free and content and comfortable buying things we need. I want to feel secure in our finances, especially our savings, in case we experience another hardship. Regardless of whether we are or not, I don’t want to feel poor. I don’t want thousands and thousands of dollars of debt hanging over my head. I don’t want to be overdrawn or in perpetual service to indebtedness.
And to do that honestly, I think I’ll need to reevaluate my standard of living.