As I reflect on the progress we've made with our debt repayment, it's hard not to get a little down on how we got here and the stupid decisions we've made about money along the way. Honestly, I'm a little embarrassed to even share some of our poor decisions (or the decisions that made us poor, ha) but I think it is helpful to do. So, here goes:
-We carelessly spent over $100K in cash. The money was from my portion of my old house that I got in my divorce. Sure, it enabled us to take time off and not work for a bit, which was nice, but we could have done so many more productive things with it. I tell myself that I needed a break and that the money paid for the time off I took, which was important to help me heal and start fresh.
-We withdrew my 401K account, worth about $30K. Once you start spending at a certain level, your mind thinks it's okay to continue to spend at that level - EVEN IF THE MONEY IS GONE. This is what happened to us and we ended up withdrawing the money I had been saving for retirement.
-We withdrew my OTHER 401K plan, worth about $10K! You would think that I should have learned my lesson, but nope, I was an idiot and went ahead and withdrew my last 401K.
-We went ahead and racked up over $40K in credit card debt. This was mainly in an attempt to let us continue to spend at the level we had quickly grown accustomed to. Meals out, new clothes, fun trips - you name it.
This totals over $180K in poor money decisions. Not to mention all of the interest we've had to pay on the credit card balances. Geez, we're probably talking closer to $200K. The thought honestly makes me nauseous. Especially since we're looking at cheap condos now that are going for around $100K, we could have bought 2 with the money we carelessly spent!
As much as I wish we still had this money, I try to tell myself that I learned very valuable lessons from my poor money decisions in the past and ones that I never plan to make again in the future. I have already started a new 401K plan at my new company. There is a small company match, so it's silly not to contribute. I will NOT touch this money until retirement. No if's, and's or but's! My thoughts on money have changed significantly since I've started this journey.
So, if you are feeling down about money. Stop! Stop right now and know that you can change. It takes some effort, but it's worth it in the end. I honestly feel as though a weight is slowly being lifted off of my back. For a while there, I was so stressed and could barely breathe. Forget about thinking of the future in a positive light. I didn't think we could get out from under this but we are. We are doing it and it feels great. I'm proud of our progress. I'm actively trying to think of the future and not the mistakes of our past. We are living well below our budget now and plan to continue to do so after we've paid off our debt. This will enable us to have an early retirement. Something we never would have dreamed was possible just a few years ago. Now, it's a very realistic possibility. More on that topic to come soon!
For those of you who are in a financial funk.... close your eyes and take a deep breathe and tell yourself YOU CAN DO IT! Then sit down, open up those bills and start a realistic budget that cuts out all unnecessary expenses (or wants, instead of needs). This is how you will begin your transformation. It won't be easy but it will be worth it. Good luck!