How I racked up $105,000 of debt and lost 5 years of my life

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How I racked up $105,000 of debt and lost 5 years of my life

Nothing is easier than piling on debt. It literally takes seconds to charge something to your credit card or minutes to be approved for a consumer loan. This is why so many of us have unintentionally trapped ourselves in thousands of dollars in debt without even flinching.

We only start to feel the sting when we start paying it back and realize we don’t have any more money to use for anything else.

This was me almost 6 years ago. We just purchased a 50-year old house that had a beautiful layout, a remodeled kitchen and lots of space.

house debt

Prior to buying the house, we were in a small condo that we bought at the worst possible time, 3 months before the housing bubble of 2008 burst. Because of this unfortunate event, we were paying triple what our condo was worth, and never had a chance to make it feel like home.

So, when we bought our house, Mr. FC and I were so excited to move in and start making it feel like “home”.

Looking back at this notion of making your house feel like home, I realize that this is how the Home Improvement market works. They play on your emotions by making you feel like your house is not a home until you’ve remodeled it to the way you like. It’s not enough to live in a new house and simply decorate it with your things. No, you need to go out and buy new things, change walls, rooms, flooring, fixtures, façade, etc.

We walked happily into the trap of debt.

From the first day we moved in, Mr. FC called an electrician to change all of the outlets and put in can lighting. Total Spent: $600.

Not too bad, you say? This is just the beginning in our massive debt accumulation.

Suddenly, our furniture didn’t quite “fit” our vision for what our home should look like. So, we went and bought a house full of furniture on credit. We bought a living room set, a dining room set (fit for 8, when we are just 4 people), a new bedroom set, rugs, end tables, dressers, mirrors, everything. Total spent: $6,000.

We moved in during February, which is pretty cold for us Californians. So, naturally, the house was cold because the windows leaked air and were too old to be fixed. So, we went out and bought all new top of the line, double-paned windows. Total Spent $7,000.

Then, one day it started raining. We had no leaks at all, but since the home inspector told us that the roof needed to be changed in the next few years during our escrow process, we decided to do it sooner rather than later. Even though we didn’t have the cash for it. Smart, right? Total spent: $18,000.

renovation debt

Then, our friends would comment on our peculiar looking wood façade. It literally looked like we had a termite infestation. I don’t know, but I kind of liked the strange way it looked. It was different. Mr. FC on the other hand was not having it. He quickly found a company who would update the entire façade, with stones halfway up and smooth stucco on the top half. Total Spent: $8,000.

Then, there was the garage door, the patio and pavers out in the backyard, installing large glossy tiles, indoor paint and crown molding. Total spent: $13,000.

You’d think at this point, we’d be scared straight back to our senses and stop the remodeling spree, right? We were in a trance, I tell ya. We just kept going, building on more and more debt.

Mr. FC needed another car, seriously, his engine on his 5 year old car kept having issues. New-ish car=a whopping additional $18,000 to our debt.

We also ran into an AC burnout on our 25 year old AC system, but instead of shopping around, we decided paying more would mean quality, so we coughed up another $12,000.

Then there’s the front fence and the tree removal, another $8,000 spent.

debt

Oh, and then there was one unexpected expense. Our plumbing leak, which resulted in us having to re-route our plumbing altogether and our home insurance would not cover the damages since they were UNDER the house. Yeah, we thought we had coverage, but we didn’t! Total spent $15,000.

Are you pissed off by reading this? I completely understand. I’m pissed off as I’m writing this. Who the hell were we thinking we were? Apparently, the Joneses. And they were broke.

But, let me add an important detail.

We didn’t accumulate it all at once. We would charge a few things, up to $20,000-$25,000 and then once we paid it off, we’d start all over again. It was a horrible cycle. We should have saved the money and cash-flowed the upgrades. It would have been much less risky and stressful.

I can’t even imagine what would have happened if one of us lost our job. We got lucky.

After we finally woke up from our trance, we realized the damage. I can’t tell you how crazy it was to realize that you racked up $105,000 of debt in such a small period of time. It gets out of control. It literally sits on your chest until you can’t breathe. It’s insane and we were insane for racking it up in less than a year.

I’m pouring my financial mistakes out to you for one purpose.

To show you that it’s ridiculously easy to drown in debt. So, if you’re in the same boat, either by making bad choices or by horrible circumstances, know that you are not alone….and there is hope.

hope of beocoming debt free

We’ve been paying this debt down and in about 2 weeks we’ll be completely rid of all of the debt! It took us 5 years to become debt-free but once we woke up from our dreams, we attacked our nightmare and ended up on the other side of the hill. The FREE side.

If you’re in debt and want a way out, make sure you sign up for my FREE 30-DAY Build Your Wealth Challenge on the side bar.  I show you all of the methods that helped us get out of debt and start getting rich in no time. It’s all about the habits and I can show you how, if you’re ready to make the change!

Until next time my frugal friend,


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