For Questions and Orders, Call
1-866-937-7506
 

My Life (In Credit Card Years)

May 24, 2007 by Rachel
Recently, I pulled my credit reports from all 3 of the credit reporting agencies (Experian, TransUnion, and Equifax).  As I looked through the information in those reports, I was struck by the parallel between my credit card life (financial) and my real life (personal).   I was in college from August, 1985 until May, 1989.  During those years, I had a couple of summer jobs and a couple of on-campus jobs.  I lived on campus and all my expenses were paid by my parents so any money that I had in my checking account was to cover my sorority and entertainment expenses.  I did not have a car until January of 1989 so I didn’t have to worry about gas, maintenance, etc.  At any given time, I might have had $300 - $400 in my account.  During college, I opened my first credit card account with American Express .  I remember thinking that I would be “safe” since I would have to pay the balance in full each month.  Honestly, I cannot remember if they solicited me or if I went looking for them. What I do remember is feeling a sense of empowerment when I got the card.  There was something about having it that made me feel more grown up.  Even if I couldn’t REALLY afford to use it, at least I had it!  I did use that account some but I don’t remember keeping it very long.  When paying the balance each month got a little harder, I moved to a “more flexible” card that would let me carry a balance. Next, I opened a VISA account and a Macy’s store charge.  I was about to graduate from college and knew that there would things that I would need – interview clothes, furniture, transportation, etc.  Obviously, I was immature as far as money was concerned.  I actually remember thinking that all I had to worry about was maintaining the minimum payments.  It would be years before I would know what the interest rate on those cards was and even longer before I realized that I would never be finished paying minimum payments.  I was just thinking about what I could have at the moment.  After a couple of years of working and living in an apartment, I had a chance to move to a duplex.  It was a bigger place and it gave me an area where I could have a washer and dryer.  Naturally, I opened a Sears charge account to buy the appliances!  By now, I was making payments on 3 cards in addition to my living expenses.  I was definitely living paycheck to paycheck and I was not saving ANYTHING.  In 1994, I needed a new car but had no savings to use for a down payment.  I quickly embraced the lease option.  That meant I could have more car than I could really afford because the lease payments were lower than the purchase payments.  Again, I was operating in the “buy it now and figure out how to pay for it later” realm!  I didn’t consider the financial impact of that choice because 1) I didn’t like paying attention to the details and 2) I didn’t really understand the details.  By this time, I had been living on my own for 5 years.  I was making a good salary and I was able to pay my bills but I never seemed to get ahead.  I had no money in savings and I was one unexpected expense away from financial disaster.  On paper, the debts I owed were relatively small amounts.  To me, they seemed like millions of dollars.  I had reached my limit of making minimum payments and I felt stuck.  I was also disappointed in myself but I didn’t totally understand why.  Something needed to change! I know now that my biggest problem then was financial ignorance.  I thought that being able to balance my checkbook and pay my payments without being overdrawn meant that I was managing my money well.  I believed that understanding money was complicated so I didn’t make an attempt.  It didn’t help that I was naïve enough to think that the credit card companies were acting in MY best interest when they increased my credit limits, set low minimum payments, etc!  Needless to say, I was a marketer and salesperson’s dream.  I only paid attention to what the monthly payment would be.  I spent a couple more years operating this way before I got engaged to be married.  That’s when my financial life actually started to change.