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Misellus
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Today's the day

#1 Post by Misellus »

TLDR: Today's the day I paid off my credit card debt

When I first went off to college, 31 years ago, I got a credit card "for emergencies." It only had a $400 limit so would be hard to get into too much trouble with it. Over the years the number of cards, and the limits increased. So did my balance. At my highest, I had over $30000 in credit card debt across multiple cards. I'd send them $500-$1000 a month and then spend as much or more. Every month. I made every payment and had a great credit score. Easy to get new cards when one would try to twist the screws and raise the interest rate too high.

A few years ago I decided I'd had enough and tried to get them paid down. Every spare dollar went to them. It helped, but really didn't work very well, I still had a spending problem. About a year ago I decided I had to change my outlook. A friend of mine told me he was considering buying a $4000 TV but probably wouldn't. The joy he got from having that money in the bank was more than he'd get from the TV. That really opened my eyes. My mindset has always been "What's it matter, I'm in so deep, I buy this and I make payments for 1 additional month, who cares about a month?" One month became 2 became 10, etc. I used to buy a lot of stupid s***. I had the addict thing where spending money was my drug and I'd feel better after buying something.

My mantra became "Don't buy stupid s***!" and it has worked. Every time I wanted to buy anything that wasn't a necessity, I asked myself if it was stupid s***, most of the time the answer was yes (I still spent money during this time, I still have the urge to spend money, I've just tried to be better at it). The balances suddenly started dropping, a year ago I paid off the first card, a few months ago the second, and today I sent the last payment ($950) to the last company. Today I am out of credit card debt for the first time in my adult life!

I'm keeping the cards, too much of modern life requires a CC, and I still prefer to use CC and carry $40 or less in cash, but I'll pay off any balance every month. They've gotten at least $35000 from me over the years in interest, no more.

New goal -- take that credit card money and get my house loan and car paid off. Less than 1 year according to my spreadsheet. It's only $18500 and much lower interest rates than the CC were.

I still want to quit my job and move to Tennessee next year. I work every week to clean and fix up the house and get it ready to sell. Some of my spending urge has been focused on buying things for the house so it's a positive rather than negative. My hope is to sell the house for enough to buy a new house, pay off any remaining balances, and live debt free (in semi-retirement)

m-
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Re: Today's the day

#2 Post by Todd P. »

No small deal. Congratulations.

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Re: Today's the day

#3 Post by Rocketeer »

My wife and I keep one credit card. You spoke of "keeping the cards"; maybe getting rid of most of them would help you on your new path? In any event, congratulations!

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Re: Today's the day

#4 Post by Otto69 »

Congrats! It feels great don't it?

Somewhere I have an old newspaper clipping which talks at length about becoming a VIP, a Voluntary Impoverished Person. Simply put it was about really thinking about much of your time, and life, you have to put in to buy something like a new TV or jetsksi. Is it worth it?

I have one card I use to pay all my other monthly bills, and then I pay it off monthly. I do sort of wish I had one more card as a back, for those cases when something goes wrong at the bank and I can't use my card for a few days.
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Re: Today's the day

#5 Post by Misellus »

=>"I do sort of wish I had one more card as a back, for those cases when something goes wrong at the bank and I can't use my card for a few days."

Yeah, that's why I want to keep all 3 cards. 2 have a daily purpose, the third is just in case something happens to the other 2 and is kept at home.

One is the card I use for food, gas, Dr visits, and medicine. It tells me at the end of the month how much I spent and whether I'm within budget. It's a kroger card so gives me cash back I can use to buy groceries (usually around $50/year cash back) but has a high interest rate. I put $200-$300 a month on it as normal, can be higher if I have several Dr appointments or tests to pay for that month. The card almost never carries a balance since I budget $300 to pay it off every month.

The second is for all other purchases. It has the lowest interest rate but no other perks. It also has a very high limit (too high IMO, I could buy a new car on it). This one can be anywhere from $50 to $300 normally and as high as $1000 depending on the month (car or house maintenance usually). It might carry a balance occasionally but only once and is paid off the next month.

The third was the one I just paid off but is not one I normally use anymore. Right now it only has my cel phone autopay attached to it. Mostly to keep it active so the CC company doesn't close the account. I could close this one and it not affect me, but if either of the other cards were compromised, I'd have to wait for a replacement rather than immediately shift to using this one. Not a real big deal either way. Having it doesn't hurt me which is why I expect I'll keep it. This is my oldest account and is over 20 years old. An account that old gives me a boost on my credit rating so it might actually hurt me a little to get rid of it.

m-
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Re: Today's the day

#6 Post by tay666 »

Congrats Randy.
I remember when I was debt free, it felt so good.
I'm still not that far in debt but I hate paying interest on anything, it's wasted money if you ask me.
If my old house ever sells, I'll be back to no interest to pay within a year (hopefully)

I admire your perseverance. It's not an easy task.
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Re: Today's the day

#7 Post by bucketfoot-al »

Congratulations! I have not had a credit card in 9 years (and never will have one again). If the money's not in the bank, I don't buy it. Simple.
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Re: Today's the day

#8 Post by overspray »

What an awesome milestone - that has to be an amazing feeling! Credit cards seem to be a necessary evil in today's world, but man do they gouge!!! I can't think of worse debts to have (at least legal ones).

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Re: Today's the day

#9 Post by Miami-Bat »

It's an awesome feeling; congratulations! We paid off all of our CC debt but decided to continue to use them on items we would normally pay by check/cash (Insurance, cable, gas, groceries, etc). Since we would be paying these and other bills monthly anyway, why not just pay the CC bill monthly and reap the rewards of airline miles, Amazon points, etc. It's been working very well so far!

Additionally, we established a Miami-Bat credit card. Basically, a slush fund to cover any major unforeseen purchases/repairs, but instead of paying 29% interest to a CC company, we pay back our slush fund. Freedom!
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Re: Today's the day

#10 Post by Heavy Metal Spike »

Misellus wrote:TLDR: Today's the day I paid off my credit card debt . . . today I sent the last payment ($950) to the last company. Today I am out of credit card debt for the first time in my adult life! . . . I'll pay off any balance every month . . .
Effin' AWESOME Randy - way to go bud :bow: :bow: =D> =D> =D> =D> =D> :jam:

We just use the ONE credit card, and always pay it off every month. Never paid a cent interest since we've been in Canada (just over 19 years).

VERY pleased for you - you should be proud of setting a goal and getting there.


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Re: Today's the day

#11 Post by Misellus »

6 month update:

Bad news: There were 2 months Nov-Dec where I did carry a balance on the credit card. Several unexpected purchases -- both computer and laptop died in the same month, found on a great deal on some furniture, plus house insurance went up 40%. I paid everything off again and am back to zero balance at the end of the month. I got a good raise and bonus in December and that helped me get back on track.

Good news: yesterday I sent in the final payment on my house loan. A month earlier than originally planned because of the december bonus. Technically I already owned the house, this is a personal loan I took out to pay off the original loan (long story, saved me $10k+). I call it the house loan although it wasn't a mortgage and had no official ties to the house.

Only thing left is the car. I still owe around $8k on it. The original plan was to pay it off asap but I've decided to just make normal payments and put the leftover money in the bank. With trying to fix up and sell the house, I might need some cash next spring/summer. I can always send a lump sum at the end of the year and pay it off if I don't need the cash for something else. The car loan is only 2%. Not a big deal.

I did celebrate a little and bought 2 new 27" monitors and a stand. I use my computer for 5+ hours a day and decided to give it an upgrade. I did successfully repress the urge to buy stupid s**t in other areas though...seriously had to fight the urge to go the gun show last month, then again when I was looking at laser cutters online

brain: "hey, you're going to have extra money, you should buy something!"
me: "shut up brain or I'll stab you with a q-tip."

Thanks for reading, don't really have anyone else to share with
m-
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#12 Post by bucketfoot-al »

" I did successfully repress the urge to buy stupid s**t in other areas though...seriously had to fight the urge to go the gun show last month, then again when I was looking at laser cutters online"

Heh, heh. With me its dinosaur figures or Harryhausen kits & figures ... but my wife keeps me sane - she doesn't do ANY stuff ... so she's a good example .. when I do splurge, however, I ALWAYS accompany it with the PURGING (ebay, or the Swap & Sell here on the CH) of ... something ... (of course I'm always paying more $$$ overall, but it does keep the house from getting too cluttered ... good report - keep up the progress!! :D
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Re: Today's the day

#13 Post by tay666 »

You're doing great Randy.
That is what credit cards are supposed to be for.
Those unexpected expenses, then pay it off in a month or two.

I admire your resolve.
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Re: Today's the day

#14 Post by Crazy Joe »

This has been a good read - We are in the process of getting s**t paid at Casa Crazy - we've got 18k in credit card debt that we are now paying at the clip of $2K a month, without buying anymore "stupid s**t" - that's what my model commission money is for. We figure the CC debt will be paid this year, and then, the remainder of the mortgage the next, with Kathie's new Impala the next. We DID have a bunch of remodelling stuff to the house to pay off, which ran about 30K more than we had anticipated, but it was worth it. I don't wanna wretch when I come home at night now. A house we bought for 69K years ago is now worth 175K (based on sales in the neighborhood) so things are lookin' up.

a footnote - we DO have 50K of the youngest daughter's education to pay off, and likely a wedding next year to help finance, but there's so much other benefits goin' on it's hard to bitch about that.
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Re: Today's the day

#15 Post by Misellus »

we've got 18k in credit card debt that we are now paying at the clip of $2K a month, without buying anymore "stupid s**t"
Keep going, you're doing good. I never would have believed how much better it feels after it's gone. I heard it for years but never believed it.

Post something when you make the final payment, I'll burn a credit card application in your honor :)

m-
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Re: Today's the day

#16 Post by Heavy Metal Spike »

Misellus wrote:6 month update . . .
    • Brain: "Hey, you're going to have extra money, you should buy something!"
      Me: "Shut up brain or I'll stab you with a q-tip."
            • . . .

LMAO - good to hear Randy - congrats again.

Ian/Spike.


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Re: Today's the day

#17 Post by kevtk135 »

Congrats! Great news!
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Re: Today's the day

#18 Post by Misellus »

2 years later...
I'm still keeping the credit cards paid off each month and it just got a little easier. Last week I paid off my van 3 years early! 5 year loan paid off in 22 months. I'm sure the bank hates me since that cost them at least $1000 in interest. Oh well :) I only have monthly bills now. No long term debt for anything. House is paid off, van is paid off, credit cards are paid off each month.

Actively trying to save money for a house (or land for a trailer). I wanted to move 2 years ago but wasn't done with fixing up the house. I got very little done in 2021. Once Fall started I realized I'd blown the whole Summer waiting for perfect weather. This year, it's been a very productive Spring so far and the house is almost done (finally). A few more weeks for painting, a few weeks after for doing carpet in 2 rooms and then packing anything not in daily use. Maybe rent a storage unit to empty the house of all but essentials. I should be ready to call a realtor in July or August to list the house.

wheeee, almost there!
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Re: Today's the day

#19 Post by Crazy Joe »

Well, last year was awesome as far as gettin' sxxt paid - Credit card debt is gone, remodelling debt is gone, a sxxtton of money in savings, nuttin' left but 4k on car, 40k on house and 40k on student loans. Life is soooooooo much easier!!!
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#20 Post by bucketfoot-al »

Good going. We moved to Texas last year and are loving every minute of being back down here. Hope you get to wherever you're going next year! :)
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