This is a story about how I developed a shocking case of credit card shame, and how it came over me incrementally so I hardly noticed at first. Honestly, by the end I felt so down on myself about my inability to handle my own finances I felt too embarrassed to go to a professional to help get it sorted out. This post was written in collaboration with Get Approved.
I remember it well: that first letter from the bank when I was in my first year at uni offering me a pre-approved credit card with a $1000 limit. That was pretty sweet because I didn’t have a job and I really needed stuff. What that stuff was is lost to me now but from memory it must have been beer, rent and bad palazzo pants. And I could pay it back as soon as I got a job, right?
Then I got a part-time job waiting tables at a family seafood restaurant, and spent the next two years smelling like crumbed calamari and mayonnaise, and dressing as Santa’s helper at Christmas. But I didn’t pay off the card; I kept it just under the limit each month. And when I decided to move from Brisbane to Melbourne to study my second degree, I asked the bank very nicely to up my limit so I could pay for plane tickets and removalists and, you know, stuff. Gosh, they were nice. They said ‘sure’.
New limit: $5000
Five years in Melbourne brought me many great things: my writing degree, some amazing friends, wonderful cultural and culinary experiences, a LOT of wine, and two encounters with Geoffrey Rush (ew, not like that). I kept my credit card under its limit, but only just. I was a poor student for the first three years, but I knew as soon as I was working full-time (as a writer – ha!) I would get right on top of it.
Life had other plans. Two months after I finished my degree, after six years of study, I found out I was pregnant. Oops.
So paying off the credit card was put off again while we tried to make ends meet and prepare for life as a trio. Around that time I got a letter from the bank offering to up my limit to $12,000. I gratefully accepted. I needed a lot of baby stuff.
Then, as many of you will know, having a baby far away from family can be hard and lonely, so I decided to pack up my little family and move back to Brisbane.
The bank were kind enough to increase my limit to $15,000 to help with moving costs. It was around here it started to feel like it was getting out of control.
Then, when my partner and I separated after eight years of accumulated life together, I needed to buy a whole lot of stuff to start a new phase on my own: beds, crockery, a couch, all the minutiae of life that you lose when it’s split in two.
The bank helped. They increased my credit limit to $20,000.
So here I was, a single mum, with a credit limit of $20,000, and I never had to go through an approval process after that first $1000.
And there my debt sat for about seven years, taunting me every month as I tried to pay it down. In that time I married, worked in corporate communications and had two more babies. Sometimes I would make progress and get the balance down significantly. A few times, I even reduced my limit as I steamed towards wiping out that debt and getting on top of my finances once and for all. Then something would happen, and the bank would offer to increase the limit at a time when I ‘needed’ something. And back I would go.
It’s important to state right here that I take full responsibility for my debts. I was the one that signed up for them. I was the one that increased my limit each time. I was the one that bit off more than I could chew. And I made it worse by trying to pretend it didn’t exist.
But then last year, Husby finally convinced me to sit down with a financial planner and looked this debt in the face. The interest alone was crippling any chance I had of recovering – especially because at the time I was on maternity leave with my third baby, my contract working as a communications specialist had just been terminated a year early and I was about to embark on my mission to become a freelance writer.
My financial planner (a sometimes drinking buddy of Husby, which somehow made things more comfortable – it could have gone either way) advised me to either get a personal loan or refinance our apartment and roll the credit card debt into the mortgage. Loan companies such as Get Approved can help because rolling your debt into a personal loan like that make sense – the interest is way lower than the crazy charges you get on a credit card, and every payment you make goes towards reducing your debt and you’re not tempted to go out and buy more shoes. We shopped around and found a bank that would give us a great rate on our home loan, so we stuffed that extra debt into the mortgage and have come out actually paying less per month than we were before. Amazing!
And for the first time since I was 24, I don’t have a credit card. Nor do I want one ever again. I have suffered from money shame for years and years – feeling just completely hopeless and like I could never get out of this hole but too ashamed to talk about it with anyone.
Credit cards don’t kill people. People kill people. But I’m happy to never have to handle a loaded credit card again. And I am finally free of that horrible feeling of shame that followed me around for 15 years.
Have you ever got yourself into an ugly debt situation? What did you do about it?