How I Got Into $29,000 Of Debt

Our financial mistakes often explain who we are, and shape us into who we want to become, so before talking about anything else, I should probably tell you how I got myself into -$29,000 of consumer and student debt.

My first mistake was being born to my mother. No, I’m totally kidding… but her overspending/lack of saving habits are identical to mine, so I do know where I learned how (not) to handle my finances.

When I was 18, I moved out for the first time. While my rent was only $300/month, I hated my job, so I called in sick a lot and spent most of my spare time partying. Obviously, these activities helped me save a ton of money.

From 20-22, I moved back home, went to college full-time, and worked part-time. I was also the proud owner of my first credit card, which I used mostly for gas, alcohol, and takeout food.

The same month I graduated from college, I landed the full-time gig I have now and moved out again. This time, my rent was $432.50/month but I was taking home close to $1,100 bi-weekly! Had I not gotten into a relationship with the most emotionally exhausting (and bank account draining) boyfriend, I would have saved a lot of money. …I swear, I’m not bitter.

At 23, I ended it with the ex and the cold-hard reality of paying for a fun, single girl life hit. My rent was $950/month + bills and, for whatever reason, I felt it was the perfect time to buy all new furniture and a brand new car! (Aren’t breakups great!?) On top of my new expenses, I was single and wanted to have fun! Eating out, going for drinks, and spending my weekends dancing at nightclubs or going out of town were exactly what the breakup doctor prescribed. Oh, and did I mention I almost bought a condo, one month after this same breakup? My offer was accepted, the financing was all lined up, but thankfully I changed my mind…

At 25, I decided to go after my dream of living in Toronto. As you can see, I am back on the west coast… but I did have an incredible 4 months off from regular life! I also didn’t receive a paycheque for 4 months, and during that time, what did I do? Drink, eat takeout, and have fun, of course!

Also, at 25, I started a two-year undergraduate completion degree online. By the end (July 2012), the program will cost approx. $18,000 (tuition and books). Work gave me a $5,000 scholarship but the rest is up to me to pay for…

Are you starting to see a trend? In terms of budgeting, I have obviously been living beyond my means. Mom and Dad have always had the ‘buy now, pay later’ attitude, so I know where I gained the same perspective, but it is up to me to change both my situation and my behaviours.

If I can pay off all of my debt by May 2014, there will be one bonus: I will have better credit. My car loan is through BMO, my personal loan is with Coast Capital, and when both of them finish without missing a single payment, the banks will know I can successfully pay off debt. Until then… I need to learn how to live within my means and enjoy what I bought myself during this crazy ride.

Here goes nothin’. Or, in my case, everything.