Saturday, August 4, 2007

I'm Free

Maybe it's my sinus-induced deliriousness, but I decided to use up my savings and finally pay off my debt. As of this morning, I am debt-free.
I can't remember the last time I didn't owe somebody money. As a child, my father would let me borrow money to buy stuff I wanted, but I always had to pay him back. My parents also punished us sometimes by fining us - and in my case, often for stuff I didn't actually do. I think they figured we would understand monetary punishment and wouldn't become immune to it the way we got used to spanking or being locked up in a hot attic during the summer (not exaggerating).
So my allowance was always allocated somewhere before I even got it, and by the time my parents let me get a real job, I was already taking out student loans to pay for college by myself.
In 1994 I answered the call of free t-shirts in the student center and applied for three student credit cards in preparation for my semester abroad in London. I had been kicked out of my parents' house the summer before, and even though I took out an extra-big student loan that year to try to cover the flights, I knew I would need money for books and incidentals while in the UK.
I maxed out my credit card one night while using a payphone to call my mother on her birthday. With the time difference, it was impossible to anticipate when I'd be able to reach her, and the toll-saver setting on their phone got me every time, so I was charged an arm and a leg for every missed call. I remember standing in a phone booth late (it was probably dinner time in NY), getting rejected by my calling card, and then calling my credit card company, begging for more credit. All this for a mother that had kicked me out of the house a year before.
Since that time I've lived off credit cards to move to NYC and to survive being unemployed for a year. I don't regret it, but it's been really hard to dig myself out of that hole. And I've chosen to stay at my companies a long time (Atlantic, 4 yrs; R&T, almost 5) instead of job-hopping to get big salary increases. So this feels like a major accomplishment.
Vic had suggested I consolidate all my credit cards into one interest-free one and see if I could pay it off, and it was the best advice anyone has ever given me. I had almost $20K on one card, interest-free through June of this year. I stopped going out a lot, buying clothes and shoes and other nonsense I didn't really need. I paid for everything on my debit card so I wouldn't accrue more debt. I paid as much as I could off every month. When June came and went and I started to owe interest, I hustled even more to pay it off.
And now I'm done.
The irony?
I'm about to embark on the biggest debt of my life, if I decide to buy an apartment next year. I have no savings obviously so I'll have to borrow the down payment, and then I'll be stuck with a mortgage that lasts for 30 years. Not being the recipient of any Wall Street bonuses or inheritances, I don't expect any windfalls anytime soon, so once again, if I want to do it, I'll have to borrow.
But I don't regret London and I don't regret my move to the big city, nor do I regret waiting 10 months for "the right job," which turned out to be the one I'm still in five years later. And since I'm in the business of avoiding regret, I'm getting ready to bring on the debt again. I'm not leaving New York City anytime soon, so I might as well make a real investment in it.