- 20 October, 2016
I recently paid off my credit card debt, but I couldn’t help think about this journey that I had put myself through. This was not the first time to go into debt but this time round it got worse. However, I managed to pay off my credit card debt and here is what I thought after finally being free from debt:
1. I finally did it
This is the best feeling ever. Having debt is like having a dark cloud hovering over your financial life every day. You have to work hard to pay it and at the same time, you have to keep up with your needs. It is the most stressful thing especially if you have a perfect fit money flow like me. I had to cut off on things that I didn’t need, and I took another job. I just had to do, and after I had paid off the debt, I felt like jumping up and down happily.
2. My credit score was officially screwed
That joy of having finally did it was short lived. I had paid the debt, yes, but the effects of what I did couldn’t come off that quickly. My credit score was so poor, and I felt the effects of this afterward. I couldn’t qualify for a loan to buy a car, and my dad has to cosign the loan because I couldn’t qualify on my own.
3. How will I stop this from happening again?
After seeing how I had screwed myself, this was the most persistent thought in my mind. I had to think of a way that I could avoid going back to the same hole ever again. I picked up a part-time job, and I started cutting down on my expenses. I had to make sure that no payment was processed late; everything had to be paid on time. This was hard, but I still managed to do it.
4. Credit cards aside
I decided to put my credit cards on the side and started using cash only for approximately five years. This helped me develop financial discipline since with cash; you can only spend what you have and not even a cent more. This practice also taught me on how to prioritize on the most important purchases more.
5. How do I get my finances back on the road and improve my credit score
My credit score was totally screwed and I could not even apply for an apartment. This time round I was a decade wiser on spending and naturally too. I had to open up another bank account and start improving my credit score. Before accepting any credit card, I had to make sure that there is a purpose it was going to serve and I fulfilled exactly that.
Credit can only be beneficial if you use it the right way. However, it is easy to get off track and misuse it so be careful on that.