A
personal story.
Five
years ago, I had over $7,000 in credit card debt. For months I had been
carrying on, paying a bit here and a bit there, but never really making any
progress. Most of the time, I tried to stick my head in the sand and just not
think about it. Slowly though, the debt began to weigh more and more heavily
upon me. It started to affect my thinking about life and the future, about what
was possible. One day, while sitting in a dark mood, I thought to myself that I
would trade everything I owned just to get out of debt. Suddenly, the mood
lifted. I realized that I really would trade most of my possessions to get out
of debt. I determined then and there to launch a war against my debt, a war
that I wouldn’t stop fighting until I had won.
First,
I needed to understand my enemy. Most credit cards, including mine, charged an
annual percentage rate (A.P.R) of around 20%. (Personally, I think that should
be criminal, but that’s a topic for another day). On a $7,000 debt that worked
out to $1,400 of interest – every year! Of course, it was worse than that.
Credit card companies don’t calculate your interest every year, they calculate
it daily.
Meaning your debt grows every single day, and because of that you are actually
going into debt at a faster rate with each passing day!
For
my purposes I didn’t need to know the exact figures, it was enough to realize
that each month I did nothing I was drifting around $125 deeper in debt. Or, to
put it another way, if I paid my credit card company $125 a month, I would never
pay off my debt. I would continue to pay this bill until the day I died, and
then pass along a $7,000 debt to my wife.
So
that’s what I was up against. I needed to pay $125 just to stop the bleeding.
If I was going to start pushing the enemy back, I needed more than that.
I
took a good look at my finances. If I was going to go to war, it was time to
start rationing. Yes, it hurt to end my subscription to all of my magazines and
to my Doctor Who audio adventures. The Sky television package got chopped down
to the minimum. Movies, concerts, meals out, they all had to go. Tough times
called for tough measures. This was war after all. When I got through with my
monthly budget, I found I could put nearly £200 towards my debt.
One
advantage I did have at the time was the exchange rate between the UK (where I
earned my money) and the USA (where I kept my debt). At the time the pound was
worth about $1.50, which was a nice psychological incentive as it made all of
the money I put towards debt feel like it was gaining an extra 50%!
So,
£200, which translated to $300 a month, more than twice what my debt was
costing me. Not bad, not bad at all. However, at that rate it would still take
me 3-4 years to pay off the debt, and in that time I would be losing
all kinds of money to interest. Unacceptable.
I
determined that every month, I would find another $300 (just £200) to put
towards my debt. I looked around the house, and started in the most obvious
place – the lead mountain. Most miniature wargamers have a lead mountain, that
gigantic pile of unpainted miniatures that you tell yourself that you will one
day paint. In my heart, I knew that I would never paint most of them. So, I set
out to sell them.
To
sell my miniatures I used a combination of Ebay and Lead Adventure. Ebay is
great for collectable items that could possibly start a bidding war and sell
for high amounts; however, its fees are also high. For more standard items, I
used Lead Adventure, my favourite miniatures forum. I used the forum to make
dozens of deals, and I can happily say I never had any issues with any of them.
Occasionally, I worried about selling my minis, but I just kept telling myself
that I could always buy them back if I wanted them (it hasn’t happened yet).
In
those first couple of months, it was remarkably easy to make money and to hit
my target of paying at least $600 a month towards my debt. At first I would
make a credit card payment immediately whenever I received money, then I
‘discovered’ that the credit card limited me to making five payments a month
(so... it could charge me daily interest, but I could only try to pay back my
debt five times a month...yeah, that’s fair). Fine, I just had to be a bit
smarter about it.
Having
cleaned out most of the unpainted minis, I started in on the painted ones that
I had from projects long ago abandoned. Even with that though, I needed to find
other income streams. I looked around the house, the only thing that came close
to miniatures in numbers terms was books. I’ve always been a bit of a book
hoarder. I kept almost all my books, including ones that I knew I would never
read again, even a bunch that I didn’t even like that much. Why? It didn’t
matter now, they had to go! After a bit of searching, I found the best place
for me to sell books was www.webuybooks.co.uk. A lot they
don’t take and some they pay only pennies for, but overall, I was able to
convert a lot of books into a good chunk of cash. Also, I found that if I just
held onto some titles for awhile, they might take them later. I soon learned
that they also took CDs and DVDs, so most of those went as well!
I
was also lucky enough to pick up a few allies in my war. One of my friends
allowed me to sell some of his minis and keep 50% of the profits. My father
also helped out, when he realized I was determined to kill my debt. (The
prodigal son fund). Still, I am proud to say that I obtained most of the money
myself.
I
sold off most of my gaming books. I sold comic books. Any time I used Tesco
points or Nectar points, I immediately put a corresponding amount in my debt
war fund. I cashed in all of my change; I sold off some collectable coins. I
wrote a couple of online articles for a bit of cash. I refused to let up,
because when you are beating the enemy back, never give him a chance to regroup.
If you are paying off your debt, never let up until your debt is down to zero.
If you stop, it will come back. That is the key, never stop, until the debit is
dead!
In
the end, it took me about a year and a half to pay off that $7,000, but I did
it. The day I won the war, a huge weight lifted off me and a felt a new sense
of freedom. Along the way, I probably cleaned out 75% of the stuff I own, and
actually, I’ve come to realize I’m happier without most of it. Just like the
debt, these useless possessions were also weighing me down.
So,
the moral of my story: if you have debt, especially high-interest rate debt,
you need to go to war. Now! It is so easy to get into debt. I did it, and I consider myself a generally intelligent, math capable person. It is hard, hard to get out of
debt, and it only gets harder as time goes by. Even as deep in debt as I was, I
kept buying stuff. I kept buying miniatures to throw on top of the lead
mountain. Put simply, I was crazy.
These
days, I’m actually in the miniatures business. I make a few pennies every time a Frostgrave miniature sells. I hope
people buy them because it helps me, and I think they are good figures, but,
please don’t buy them if you are in debt, and please don’t go into debt to buy
them. I assure you, you will be happier without the minis and without the debt.
I also assure you, if you want them later, they will be there.