When I say I’m in the midst of a tsunami, I’m not being dramatic. Dave Ramsey would be disgusted by my circumstances. I say this in complete seriousness: people commit suicide over less. I’m in a situation. Perhaps I should call on the governor, as this is, indeed, a state of emergency.
I’ve got all kinds of debt – credit cards, a car note, back taxes owed to the IRS, mortgages and a small amount I owe to my mom for an expensive international airline ticket. I’ve also got business debt – one credit card with a large balance. I’ve got a lot going on.
The funny thing is this: I don’t have a closet full of designer clothes or bags. I have almost no jewelry. I, have not one single pair Louboutins . . . no Louis Vuittons, no Chanel, no Gucci . . . none of that. Wait. I have one pair of Gucci sunglasses that I wear all the time. That’s it. Despite the fondness that some folks seem to have for my booty, it’s real, so I’ve paid nothing for it. I’ve had no cosmetic surgery. I don’t have an extensive self-care regimen involving botox or other injections or blood facials or any of that other high-end stuff that makes people say, “WTF? People spend money on that?”
The issue is not really that I’ve been extravagant. I just wasn’t paying attention. I also wasn’t being intentional. I was under the impression that I could do things that I simply wasn’t in the financial position to do. Part of me also wants to say that I was surviving. When you see the balances for the tax payments due to the Internal Revenue Service, it is clear that I was receiving income, but wasn’t doing a good job of paying the quarterly taxes that a self-employed person should pay. (I’m now a W-2 employee of the business so my taxes come right out of my bi-weekly paycheck. I’ve obviously still got a mess to fix, though.) I was using the money to live. I was using the money to pay bills. But, I was also using the money to live a lifestyle that I believed I deserved, but that I, frankly, could not afford.
Though my closet isn’t full of designer items, I do have a body that has consumed a number of high-end meals – high-end meals from restaurants that others view as “special occasion” restaurants. I used to eat out a lot. A lot. I’d go to whatever restaurant I felt like going to because . . . that’s where I wanted to go. There was no “special occasion” restaurant for me. Additionally, I have a specialized diet. My primary protein has been seafood (although that’s changing, too). Seafood isn’t cheap. When I was trying to be “low budget”, I’d get my crab legs and salmon from the grocery store and prepare those items myself. One pound of crab legs can be $11 to $13 per pound. I’d do this with absolutely no regard for the cost. I know. Silly.
There have also been times when my income was just too low. I think that’s still the case. I’ve been self-employed for just short of 7 years now and my income has not been consistent. Though the firm’s annual revenues have increased every year with the exception of 1, expenses have increased as well. I tell people that, even as a lawyer, this self-employment thing is a hustle. Some months it feels more like a hustle than others. Some months have been great; other months have been a disaster. Instead of being fully aware of my income reductions and/or shortfalls and making the appropriate behavioral decisions at that time, I continued to act as if nothing had changed. I blame no one but myself for all of this.
Single Girl’s Tsunami
Personal Credit Card Debt
- Credit Card 1 $8,568
- Credit Card 2 $1,322
- Credit Card 3 $6,897
- Credit Card 4 $13,175
- TOTAL PERSONAL CREDIT CARDS: $29,962
Car Debt
- Car Loan $18,454
Mortgage Debt
- Mortgage 1 $78,041
- Mortgage 2 $29,610
- TOTAL MORTGAGES: $107,651
Back Taxes
- IRS – 2015 Taxes $1,225
- IRS – 2016 Taxes $10,204
- IRS – 2017 Taxes $10,349
- TOTAL TAXES: $21,778
Student Loan Debt
- Student Loan 1 $64,864
- Student Loan 2 $86,734
- TOTAL STUDENT LOANS: $151,598
Business Credit Card Debt
- Business Credit Card $24,385
Miscellaneous
- International Airline Ticket** $1,072
** Why would a girl in my situation even consider a vacation, let alone an international one? The short answer: the ball was already rolling on the trip when I made the decision to be serious about cleaning up my financial life. Remember, I’ve only recently become totally, undeniably sober about the severity of my circumstances. Every year over the past several years, my family takes a group vacation. We’re a pretty close family in that we have a core group that has been committed to coming together from our respective parts of the country at least once per year. Our destinations have included the Bahamas, the Dominican Republic, Mexico and Las Vegas. The planning for this year’s trip began late last year/early this year. So, as Single Girl was coming to the reality of her dire situation over the last few months, she realized that, though the plane ticket had already been purchased by mom on her behalf, she really shouldn’t go on the trip this year. Single Girl has almost always been the planner of these family trips, but notwithstanding that, this year she came to the realization that a trip would be a terrible idea. When I broke the news to my family, my mother went bananas. She called my father – telling him that I was eating on $25 a month (she was, apparently, confused by the $25 per week food budget that I’ve allocated for myself). He then called me asking for my PayPal information. She even hit me with the “this is about family and family is most important.” Jesus Christ, Mom. So, with the influx of funds that month from both my Mom, my father and even my little brother, I was given some breathing room on my cash flow. I told my mother that, if she allowed me to pay her back in payments for the airline ticket, I would be able to go on the trip this year. But . . . I warned my family . . . don’t expect me to go to nuthin’ else – NUTHIN’! – until I make some serious headway on this mess I’m in.
When I started this blog, my total debt about was $332,547. Today, the total is $329,406.29 (excluding the business credit card, which does not get paid out of my personal income). At the end of each month, I review each of my balances and capture them into a Google sheet. I’m finalizing my plan of attack, which I will lay out in future posts.
Isn’t this a disaster? Aren’t you glad you can say to yourself, “At least I’m not doing this badly?”