Our very first credit card was paid off in full and the account closed in November 2014 (you can read more about our journey here). This was a small victory for us but a victory nonetheless! We just couldn’t be happier. We celebrated the day we closed that account and immediately started talking about paying off the balance on our second credit card. The balance we had remaining on that card, although high, was not very high and we felt that, with regular extra payments each month, no matter how small, we would soon be rid of that debt too.
Fast forward to the first half of 2015 and things were not looking good for us. Due to unexpected medical expenses as well as business-related expenses, the balance on the credit card had tripled; just ballooned, almost over-night it seemed. To make matters worse, there was no wiggle room in our budget during that time, and this would continue well into the year due to recurring medical expenses as well as business-related expenses each and every month. Eventually, we were exhausted – physically, mentally, emotionally and financially. Last year was a tough year for us. Although I don’t quite remember when we’d hit rock-bottom, all I know is that we did. And that lowest point was our turning point once again, as clichéd as that may sound. We realised that we had to get up and get moving in the right direction once again.
Fast forward another couple of months, and we’d tightened our already tight budget even more so that we could get back on track with extra credit card payments each month – whatever we could, whenever we could. We spent very little over the holidays simply because there just wasn’t much to spend. It was an all-round tough year. Yet we still managed to buy nice and thoughtful Christmas presents for all our loved ones, host a lovely Christmas lunch for a few family members and enjoy our time off, despite everything (read about Christmas and New Year frugal ideas here). We got through the two toughest months of the year – December and January – without incurring any additional debt for any of our household expenses. We usually budget for these two months very carefully so we don’t normally experience shortfalls but considering what a year we’d had, I was wondering if we’d make it. And we did.
We carried on budgeting, crunching numbers day in, day out, tightening up on whatever we could (read about how we saved on our monthly expenses here). Additionally, we made a decision to go through stuff that we have around the house and sell – an extra this, an extra that but generally items that we don’t really use often, or don’t use at all, or just don’t like or have outgrown, etc. This took us a while and I remember, at the time, a well-meaning friend asked me why I was even bothering to sell anything because I “wasn’t going to get much anyway so I might as well keep it”. While it may be true that we tend to pay a lot for brand new things sometimes only to end up selling them a year or two later for half the price, or even less than that, I realised that I was looking at the whole situation differently. The item has been paid for already, that money is gone, but I can certainly think about selling the item and getting some new money to put towards extra credit card payments. Every little Rand I got, and could put towards the credit card debt, meant that we wouldn’t be paying 18% or 20% interest on each one of those Rands.
So if this is something you are thinking about doing, then I can tell you with certainty that those Rands do add up and they do make a difference. It will take a bit of effort and thought and planning, not only going through your things and deciding what to sell, but also selling those items. We’ve pretty much done it all: we’ve sold privately, we’ve used Facebook groups, we’ve taken items to Pawn Shops (several of them, actually), we’ve taken stuff to flea markets, we’ve sold to Cash Converters. It all works. If one shop doesn’t want your items, try another one, or two, and someone will eventually take those items off your hands. It really is as they say: one’s man trash is another man’s treasure. And the items that you decide to sell don’t even have to be big ticket items – most of what we had were small things that we didn’t really need. The important thing is that the amounts you do get will add up to a nice chunk of change which you can then apply towards your extra credit card payments straightaway.
In addition to this, I’ve also started doing some extra (paid) work over the weekends. This is not always available through my workplace but on the few occasions that it was offered to employees, I volunteered. It is, after all, a bit of extra money at the end of the month and every bit helps as we can always use that extra money to put towards repaying our credit card debt. While we are not out of the woods just yet, the amount we owe on the second credit card has reduced. It is now half the amount it was when we started paying down the balance. Woohoo! Just saying this fills me with absolute joy. While we still have a good few months ahead of us, the progress we are making keeps us motivated to pay off our credit card debt. I cannot wait to fast forward over the next couple of months.
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