I didn't mean to go into credit card overdrive, but the usual suspects reared their heads: No job. No savings. Underwater mortgage. I was collecting credit cards like a crazy cat lady welcomes felines. Don't ask how much interest I paid by sending only the "minimum balance" to each card company monthly. When I looked at the interest totals posted on my year-end statements, I became so disgusted, I quit cold turkey using conventional and not-so-conventional budgeting methods. Now, with the exception of my mortgage, I'm debt-free.
1. I read. Knowledge is power and I'd handed over my power to the credit card companies, so I learned more about the state of credit purgatory I'd gotten myself into. I checked out books on the history of credit card companies from the library and searched online editions of The Wall Street Journal, Crain's, The Economist and other websites to fix in my mind the damage I was doing to myself thanks to an industry that could care less about my financial health.
2. I said no. During the earliest of my fiscal reformation days, interest-free credit card offers came my way like swallows to Capistrano. They tempted me mightily; and I considered consolidating all of my balances into a single monthly payment. But I knew myself all too well. I would have wound up adding yet another card to my stash - just as I had done in the past -- and that was the last thing I needed in my effort to become financially liberated.
3. I sought counseling. Credit counseling has become a growth industry, but I was in no position to pay the fees charged by debt relief agencies. I joked with friends about putting counseling costs on a credit card. Now I'm aware of organizations like The National Foundation For Credit Counseling (http://www.nfcc.org/) that might have helped me had I not realized that I could turn to the financial manager keeping watch over my retirement money. He's not a credit counselor but he offered to put me on a budget and work with me to become credit card free.
4. I Journaled. One of the first things my financial guy insisted on, as a term of our counseling relationship, was that I keep a journal of every cent I spend using my credit cards. Talk about a wakeup call: This was both tedious and shame producing, but I couldn't ignore the truth when it stared me in the face. The journal gave me a true picture of the frivolous nature of my credit card expenditures and habits. Journaling helped me reach a state of acceptance. I was finally ready to cut the cards up.
5. I Cut. Yup. Cut up the cards. All but one, as my financial mentor decided that I was ready to be responsible for just one, but that didn't mean it could live in my wallet. Don't laugh, but I suspended the card in a giant ice cube created from an ice cream carton filled with water. Laugh if you will, but defrosting the card from its large and icy prison (where it remains) was the best idea I could think of to buy time should the urge to use the card strike. As far as my other cards were concerned, I cut them up but didn't close the accounts to help right my credit rating ship.
6. I substituted. Having no credit cards sent my social life into a nosedive. The lavish lunches, dinners and theater tickets I routinely put on my cards were now officially history. When I told friends and family that I was going to an all-cash system, I believe they thought I was joking. When they realized I wasn't, they decided to become my credit card cleanup team by reminding me of my commitment. I'd suggest dinner. They'd suggest a potluck. I mentioned theater tickets. They bought the Twizzlers at the cheap movie theater matinee. Who'da thunk dumping my credit cards would have brought me closer to friends and family?
6. I Changed. As a cultural anthropologist, I study human behavior all the time and I can affirm this statement because I'm living it: I no longer have the urge to use credit cards for impulse buys. Time and practice are underrated character-building assistants when taming a bad habit, but the end result is that I'm no longer tempted to dig out the card tucked into the ice cream box. Could my credit card habit again rear its ugly head? It's possible. But I've got a hunch I won't defrost it unless I move and even then, friends have offered to store in their 'fridges for me!
- Financials Industry
- credit card
- Credit counseling