Okay so today was wake up day for spending, debt, and living on a budget. Time to give my head a shake and stop ignoring the problem. Pretending it didn’t exist got me into almost more trouble than I can handle. Coming to this realization was hard. I consider myself a smart person. How does a smart person make some of the purchases and money decisions that I have made lately (did you read my last post where I considered asking for the summer off…no income, what was I thinking – I know, I was thinking it would be an amazing summer with my daughter in the sun).
I think what really slapped me in the face today was looking at compound interest and the number of years it could take you to pay things off if you paid barely above the minimum. I kept buying things or limiting the amount I paid off thinking I would pay it off at some point. But wow, if I kept at it the way I was I could have been paying things off until Annika was in highschool. Made me feel like a not so great mommy at that moment. I can’t imagine apologizing 18 years from now, “Annika I can’t afford to send you to University because I like shopping too much”.
I am thankful I’ve had this drastic of a wake up call. Because I have to shamefully admit that this isn’t the first time I’ve fallen into a bit of debt. The last time it happened, my Grandpa loaned me some money and I got on a serious track and paid it off quickly and ahead of schedule. But it was easy. Too easy. I didn’t learn a lesson. And I’m pretty sure I started using my credit card flippantly fairly soon after I’d paid off the debt.
Having my daughter has also put more of a real timeline to my life. As a single women I could afford to live lavishly; I had no one else to consider but myself. Now I feel guilty that I’ve created this situation. I could look back and scorn myself, I could wallow in self-pity, I could look at it as hopeless and continue to ignore the problem. But I’m not, I’m taking the right actions to fix it and to ensure it never happens again.
You can also bet that Annika will have so many lessons on how to manage her money that she will hopefully be rich and able to retire early (and maybe take care of her poor momma).
I’m arming myself with some tools (found a great debt payoff calculator for excel), living on cash only (cutting up a credit card), and also looking ahead to plan for things (tire changes, medical costs, birthdays, etc) so they don’t put me back in the red when they happen.
Wish me luck!
PS – anyone want to buy a snack bag? 😉