Got Debt from Stupid Spending? Suck It Up and Fix It
Posted by Cap in Personal Finance |Whew. Good riddance to 2008 eh? What a craptacular year.
Without going into too much details, lets just say yours truly made a series of serious mistakes in 2008, almost on the same level of my previous stupidity of amassing around $10,000 in credit card debt back in 2002.
Yeah, parts of ’08 was that crappy. Even though they were not exactly financial mistakes, they were costly mistakes.
Having said that, this brings me to the point of this post: dealing with the debt you’ve created from poor spending decisions.
As a very much imperfect person (my parents will attest to this) that’s slowly realizing he’s the harbinger of mistakes, I’ve learned a few things about dealing with poor choices in life.
Whether they are financial mistakes or something else, there are about two choices you have when you’ve made a mistake: 1) Suck it up, learn from your mistake. 2) Continue the fun fest of being stupid.
The Excuses We Make
Geez. Cap is being so negative. He must have gotten rejected by the local bowling team again.
Be that as it may, the truth of the matter is that we will often try to habitually justify our own ill-conceived actions through excuses and poor reasoning. If you’ve ever made a stupid mistake that you’ve regretted before, you’ll probably know what I’m talking about.
“Its not my fault I spent so much. Work is stressful and I need some occasional relief.”
“Its not my fault I didn’t pass that test. Chelsy was in a bad situation and she needed me to be there for her.”
“Its not my fault my body weight went uncontrolled. I’m too busy with work/school/etc. to get a proper meal.”
If any of these sounds familiar — worry not, you’re not the only one that has thought of them.
Understanding the Mistake
When I woke up that one faithful morning six years ago and realized the asshat decisions I’ve made to get myself in the position of owing so much money — all the excuses I’ve been giving to myself suddenly disappeared. For months, the excuses kept the realization at bay, but at that one brief moment, I had a moment of true clarity and realized that I didn’t want to continue to live a debt-ridden life.
What I’ve just described may sound a bit dramatic, but that morning was a definite eye-opener for me (being scared sh*tless by debt helped too, of course). And from that eye-opener, I made the frequently mentioned mental attitude change. I decided to spend less than I earn, save money, budget, yada yada — you’ve most likely read it all before (if not on this blog, then on another).
Fixing the Mistake
If you have amassed debt from excessive consumerism (or some equally stupid reason), you should know that combating that particular debt doesn’t require some magic formula or a requirement of being a super genius. You’ve probably noticed this already, but I’m not exactly a rocket scientist (again, my parents can also attest to this) — if I could paid off debt with an attitude adjustment, you can too.
Thus, suck it up. Realize that you’ve made a mistake and make a plan on how you can fix it. There are hundreds, if not thousands of articles online with methods and steps you can take to pay off your debt.
Here’s a simple guideline:
- Earn more money or spend less money.
- Use excess from earnings/savings to pay off debt.
- Done.
It’s a New Year. Make it a better one!
- Correct Way to Pay Off Personal Debt: Debt Avalanche – Consumerism Commentary
- Get Out of Debt Guide – Jeremey from Generation X Finance for About.com
- How to Get Out of Debt – FiveCentNickel.com
17 Comments to “Got Debt from Stupid Spending? Suck It Up and Fix It”
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January 15th, 2009 at 7:21 am
“# Earn more money or spend less money.”
Sadly, this helps few people. Most of those who have a spending problem, and ‘fix it’ by earning more money will just up their spending.
“I make more money now! I can afford ____!”
But I do know that I save a lot of money every month by resisting the urge to buy ‘crap’. Small things of ‘insignificant value’ that add up to enough to buy (or invest in) something I really want.
January 15th, 2009 at 9:59 am
Been there done that, now I’m so scared I’ll fall off the wagon I hardly spend at all. I learned to appreciate the savings in my bank more than the stuff in my closet. It also helped me to start thinking of purchases in terms of the time I have to work to pay off the debt. Do I really want that dress so much I’ll spend an entire day at work for it? Nah.
January 15th, 2009 at 10:26 am
I have to throw in with posters 1 AND 2.
Making more money doesn’t fix your problem UNLESS you fix your attitude toward money and debt. PennySeeds is right on the money in the assessment of the attitude toward more money. Someone who spends excessively will see a 10% increase in income as an excuse to have an 11% increase in spending. You have to fix the mindset, once THAT’s done, then the extra money will help.
Miss M touches on a good way of thinking. Putting everything you buy in terms of how much you have to work to get it. As if, you worked to pay it off. Are you willing to put in a whole day at work for those fancy shoes? Will you work a whole month for that TV?
In my case, I just bought a house, and in addition to calculating the mortgage 50 ways, I also broke it down into how many days of work that payment is going to be.
Both of these points are related in that you HAVE to fix the way you think about finances before you can fix anything.
January 15th, 2009 at 12:25 pm
All good comments. It took 2008 for me to finally realize the single most major econominc blunder I committed in my lifetime. And that blunder was that I trusted the ‘experts’. I was always frugal in my life … I was a live-within-your-means deciple … I seldom bought ‘crap’ … I understood the concept of ‘opportunity costs’. But at the same time I believed in all the experts that claimed. Stocks are the best asset class investment for growing your retirement nest egg. The economic pie is always expanding; it never contracts. Real estate prices only go up. When stocks go down, they always come back up. You cannot time the market, but the trend over time is possitive. Stay the course, stay invested, you don’t want to be on the sidelines when the market comes roaring back as it always does. Follow the ‘smart money’.
Just watch the financial channels with their talking heads. This is a buying opportunity of a lifetime for stocks. We’re nearing the ‘bottom’; there’s all this pent-up cash out there; have the courage to jump in say next week or next month and ride the market up to the stratosphere of riches. Things will not only turn around (as they inevitablly will), but the next bull market will be even stronger. Be like Warren Buffett; greedy when folks are fearful, fearful when folks are greedy.
Any of you people still buying this ‘crap’? I’m sure some of you are, and I wish you good luck. You’ll need it. Luck that is and lots of it. Timing is everything. Those that jumped into the market in 2005 have lost their shirt. I din’t get burned as badly as many, but I’ll never fully recover – I don’t have all that much time. My advice: be skeptical of all the hype.
January 15th, 2009 at 2:17 pm
I lost a very good job more than a year ago. I’ve been working for far less than I was making before. Needless to say I have not been able to purchase anything that is not absolutely necessary.
The experience has been truly eye opening… It really put things into perspective. I see through all of the things I thought were so important in the past. I see their true value… nothing. Just more things to desire and attach myself to.
I am more free and happy than ever before.
January 16th, 2009 at 2:17 pm
Couldn’t agree more with your post. We all try to justify stupid mistakes. There is a great book on how and why we do this – “Mistakes were made but not by me.” I highly recommend it. (forget the author’s name tho).
January 17th, 2009 at 10:04 am
Great post. I do pretty well on the save/spend ratio, but call me guilty on the “eat too much”, “waste time when I should be studying” matrix. Your post is just as applicable there. No excuses, just making better choices, day after day after day. Only solution.
January 19th, 2009 at 3:48 pm
(Just found your blog, LOVE the title) Completely agree with you and other posters. I moved back to the States after living overseas for six years and after finally securing a “good” job I was laid off just one month later. Nice. In all honesty it was one of the best times because I stopped buying crap. I had to. And you know what? I loved it. Of course after finding another job and getting in debt because “I can afford it!” I’m working my way out. And I’ve never been happier. :)
January 19th, 2009 at 4:57 pm
Yes, I’ve finally woken up and faced up to my consumer debt. I’m determined to pay it off in 18 months although this year will be extremely tight financially. Let’s hope I keep my job.
I do like your blog.
January 21st, 2009 at 12:33 pm
what do you do if the debt was not entirely of your doing? such as divorce…there is no possible way to recover from such a hit when you are trying to pay everything that was previously being handled on two incomes and now has only one income?
January 22nd, 2009 at 7:59 pm
erik: Situations like are exactly why I mentioned specifically “stupid spending.” In those instances (divorce, medical emergencies, lost of job due to illness, etc.), it can get awfully difficult to get out of debt and is an entirely different scenario than debt from excessive consumerism.
February 7th, 2009 at 10:19 pm
Several years ago, after several legitimate financial problems as well as spending frenzies on stuff I just had to have at the time, I also found myself in about $10,000 of credit card debt. It was a combination of 0% APR offers enticing me, and also confusing my ability to pay a monthly fee with my ability to afford large purchases at the time. Basically, I was looking at how much I could afford to pay in any given month, but not really thinking about the long term and all of the debt I was accumulating. Luckily, I had a decent paying job and was able to suck it up and pay off my debt, but it took me several years and I ended up playing the 0% APR balance transfer game for a while to avoid interest charges. Nowadays, I’m able to show a little more restraint, but I still find myself wanting to buy large purchases that I don’t necessarily need right away, but just don’t want to wait until I’ve saved up the money. I mean, who does. But having been there, I definitely know how it hurts to know you have to work very hard just to break even, and that’s not even considering trying to save some money for the future. It makes me think that credit is the burden of the middle class. The lower class can’t get it, the upper class doesn’t need it, and the middle class uses it to reach as high as they can, but it’s often their catalyst back into the lower echelons again. Oh well, it’s a curse and I don’t want to use it, but just don’t take my line of credit away in case I need it…
February 8th, 2009 at 11:39 am
Spot on about living and learning from mistakes. Unfortunately, some people, in a self-deluding fit or misplaced optimism, think their fortunes will improve through some external intervention … But surely it’s all about spotting the signposts on the way … and getting sensible!
February 17th, 2009 at 2:37 pm
I’m nearly there! I’ve really been hitting my debt hard lately, which has tightened my belt a touch, but left me happier every time I make a deposit. I found this article helpful as well:
http://www.debthelp.com/kc/debt-consolidation-climbing-the-mountain-of-debt-one-step-at-a-time.html
Good luck, everyone!
July 23rd, 2009 at 5:53 pm
Ha ha! I love it! What a great blog! Strict, to the point, blunt, but soooo true! (I’m talking about this part…)
“Here’s a simple guideline:
1. Earn more money or spend less money.
2. Use excess from earnings/savings to pay off debt.
3. Done.:
July 28th, 2009 at 4:43 pm
I love that, “suck it up and fix it.” Instead of wasting time complaining about your debt, do something about it. Easier said than done, since for most, financial decisions aren’t rational but emotional. Anyways, I work at a debt settlement company, and I have to say the hardest part is getting someone in the door. Different things motivate different people. Maybe your not-so-subtle approach will motivate a new crowd to face their debt.
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