Six Things Debt Taught Me in 2019 (and What it Prepared Me for in 2020)

Tiny Changes Make a Big Difference

Hang in there. You can do it. (Photo by Vanessa Lee on Unsplash)

1. Give yourself a financial detox period.

When you first begin to address your debt, take a time-out to assess and change your habits.

You don’t have to leave the planet, just maybe don’t leave your room.

2. Yes, you have to budget.

Tracking my expenses and sticking to a budget were the single most important changes I made in 2019. You might have to experiment before you find the best path. Luckily, there are a lot of good models out there.

3. Save, even while you are paying down debt.

When I really, truly, looked at our money, I had to admit a hard truth: we’ve done okay on long-term savings, but our lack of short-term has hurt us repeatedly. I bought into the “wisdom” that you should pay down debt before saving, which is bullshit for people like you and me.

4. Face your debt and spit in its eye.

You’ll be keeping track of a lot of things in the effort to get out of debt, mostly in apps, on spreadsheets or old-fashioned pencil and paper. I found, early on, that I needed to see my debt in physical space, and reduce it in some way that was materially satisfying.

  1. Choose an increment for each link. I chose $1000 for most of mine, but if that doesn’t encourage you, choose a smaller increment that feels right.
  2. Make it fun. Choose nice paper or interesting old magazines, gather your supplies, and enjoy the process, especially if your chain is long.
  3. Relish the tear-off. It’s a really special feeling to yank a link off your debt chain. You might even make ritual of it. Indulge in a celebratory moment as you acknowledge what it took to knock down your debt by $25, $50, $100, $500, or $1000.
  4. If tracking your debt feels too negative, try chaining your savings instead. Hey, if staring at a pile of debt is too depressing, I understand. How about adding chains to a savings visualization instead?

5. Take baby steps, and don’t peer too far down the well.

You might be in the same boat as me: Most of our debt will be with us for at least five to seven years, and some of it will be decades in the paying down. A few debts are likely to die with us (cough cough, student loans literally do, cough cough). If I kept that fact uppermost in mind, I’d probably be too discouraged to continue. Instead, I set reasonable goals and celebrate small victories. I try to set goals in terms of behavior changes, which I can control, at least as often as outcomes, which I can only partly control. Two of my goals last year, for example, were to increase my savings rate (behavior) and to get our credit card use down from 66 percent to 50 percent. I accomplished both. This year’s goal is to increase our net worth, if only by a dollar.

6. Don’t be a dick to yourself.

Make no mistake: going cold turkey off credit cards and changing your spending and saving habits is really really hard. Do what you can to make the transition as pleasant as possible.

I’m a 50-something bohemian with a mountain of debt and regrets. Can I dig out before it’s all over? I brake for poets.

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