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Why do people get into debt?


Hooray! Apologies for the loud voice but I TRANSFERRED MY CREDIT CARD BALANCES TO MY LINE OF CREDIT! I was approved for the 4.99% introductory offer. After one year, the rate changes to prime plus 4.5%. Many of you have warned me about the perils of taking on more credit. While I’ve made moderate progress over the past couple of years, I’m taking this opportunity to turn my financial life around very seriously. I want to have enough personal wealth to buy a house comfortably (without stretching myself). I am someone who is both historically bad with money and also quite anxious about not having enough. I’ve been thinking lately… how did I get into debt? 

How did I get into debt?

I’m still working that out, but I am not alone. This AARP article says that “More than half (55 percent) spent equal to or more than their total income including 57 percent of Millennials, 58 percent of GenXers and 49 percent of Baby Boomers.”

Like many others, my debt journey started innocently. On university campus during frosh week, they hand out credit cards like candy! I used it to buy things on eBay and paid it in full. Then a friend invited me to the Caribbean to stay with her for free, but I needed an airline ticket and had no savings. By this time, the bank had increased my credit limit (without asking me, by the way!), and I happily slapped my card down. I would work extra hours over reading week, only a month away. My school was on strike for two months and I had nothing better to do (current me: GET A SECOND JOB, DUMMY!). That was the beginning of a slippery slope.

How do people end up in debt?

Sometimes, people use cards when they can’t make ends meet. I’ve never been in that position, thankfully. I’m just impulsive and short-sighted, but I’ve always made good money. Even in university, I made over 40k a year bartending. $400-600 a night cash on weekends, believe it or not. I worked in some really happening places. I’ve never used a credit card to pay a bill or rent. I just buy stupid toys I don’t need. And that is why I still owe a few thousand for my student loan (unbelievably stupid. I could have invested that money! All that lost compounded interest…).

My bartending days

My bartending days

Ahh, yes. Student loans. Often the first piece of debt someone has in their own name. If finance was taught in high school, kids wouldn’t do what my friend did, which was take out a bigger loan than he needed. He was a popular guy, buying rounds at the bar. The rest he gambled away. He is moonlighting as a waiter to pay these off in his 30s.

Others don’t have an emergency fund. I barely have one (it will be at $2500 as of tomorrow when I get paid). If you can count on anything, it’s that there will undoubtedly be emergencies. I have used credit for car repairs, vet bills, emergency flights, and more. All things that I should have known would happen at some point.

Debt throughout life

Marriage and Divorce are both incredibly expensive if you don’t play your cards right. I’ve been spared of this, but I also have been paying rent alone all my adult life. Sharing expenses sure would be nice. If I ever get married, you bet there’s a pre-nup.

Of course, it’s hard to find fault with people who are hit with unexpected medical expenses. Heath care is something we need to survive, and it’s the leading cause of bankruptcy in the US. In Canada, prescription drugs are usually not covered by government heath care plans, and cancer drugs can be thousands of dollars a month. If you don’t have drug coverage through work benefits, you’re going bankrupt to stay alive. It’s hard to believe we have allowed such systems to exist.

In Canada, reduced income is the leading cause of bankruptcy. That could be due to job loss or a life event. In any case, I’m working hard to set myself up for success down the road. It turns out, I am quite risk averse but have been inadvertently leading a risky financial life!

Thanks for following along so far. It’s really motivating to be honest here about my situation.

Time for some New Entertainment


One of the ways we have saved the most money over the last few years is by completely cutting out entertainment costs. We were once a movie going, popcorn loving, amusement park addicted, dessert having family.

Now movies are a true treat as they don’t happen very often at all. And we no longer live within a few miles of Busch Gardens and Water Country. (Some of you will remember my off the cuff splurge on Universal passes when we first moved to Georgia, thinking, we could easily traipse down to Florida for some fun. I think we did that twice.)

We have also cut down eating out…and ordering any extras when we do eat out. So yeah, our regular entertainment budget is pretty much $0 all the time. And I don’t think we miss it much, I know I don’t. The kids are at an age and maturity that they would prefer to hang out with friends or be on their phones to the fun adventures that I used to plan on a regular basis.

BUT…Quality Time is Still Important

We do still have regular family nights or days or hours. It’s important to me that we spend some quality time together at least once a week. Lots of times this involves visiting a free Saturday night concerts downtown, going to the library (I’m so grateful that all my kids are avid readers) or most often, playing a board game or doing a puzzle at home.

board games

Our current collection of board games. The buckets have card games, puzzles and more small games in them.

I’m also excited to start exploring some of the many mountainous park areas around here. I have recently been given a tour of some “local only” areas. And they are gorgeous! Can’t wait to take the kids and have picnics or just let the dogs roam a bit.

However, until it cools off a bit more, I am not interested in any outdoor activities. This high 90s every day is killing me! (And I had to see my electric bill, ugh!) This is why I’m here today…

Our currently collection of games are getting stale. And with only 3 people now, some of them just aren’t as fun to play anymore. Our go to games over the last year or so have been Ticket to Ride, Catan and some card games like Uno. But we need some new ones! Desperately.

So BAD community, tell me your favorite board games. We prefer strategy type games to anything else. And don’t mind some of the “mature” themes since the kids at home are older and mature. Hit me with your best recommendations in the comments. And if you have other “free” entertainment that your family loves, tell me about it.

I’ve just scheduled college visits for 3 of Princess’ school holidays, do you think that counts as entertainment? Georgia Tech, Clemson and Spelman, here we come.