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Two Down, $2,000 to Go

This article was written by in Credit. 38 comments.


When I was a new college graduate in 1997, I got my father to co-sign on a credit account so I could buy a computer. It was a shining white beautiful Gateway 2000, it probably cost around $2,000 (you kids and your $300 computer deals!), and it came with an interest rate of 26.9%.

Around the same time, I was approved for my first credit card, and then my second, and things went pretty badly after that.

Some of the details of that time in my life are fuzzy, but I know that I paid off the computer loan. I had to move back in with my parents in order to afford that, but it was paid off. And until today, that was the only installment or credit account I have ever fully paid off. I’ve gone for eleven-ish years with nothing but revolving credit and unpaid loans to my name.

But I’m proud to announce something totally mundane: we paid off our Rooms-to-Go credit account. That nice big bed in our master bedroom? We actually own that. Like I said, it’s mundane, and there’s probably no reason for you to be impressed by that, but it means the end of a nasty stretch of feeling entirely guilty.

Now I just feel mostly guilty. I’ve still got a balance on what I call my “legacy credit debt” – the debt that’s been in various states of huge for over a decade, and which gets consolidated and moved around but never fully wiped out. But there is good news there, too: that balance is below $2,000 for the first time since the 1990s. I haven’t charged anything to that card since I-don’t-know-when, and I can see the light in the clearing.

Unfortunately, there’s more bad news. My other credit card – the one that I didn’t intend to carry a balance on – has a big balance on it. It’s embarrassing… so much so that I’ve avoided even telling you guys about it. I bought a Mac Mini to use in the entertainment center, and we got tickets for a comedy convention next year, and a paranormal investigation, and we started a corporation. Needless to say, those aren’t the daily expenses I was expecting to put on that card.

Oh, but there’s more good news: my wife got a raise recently, which means she can contribute more to the joint expenses, which means I can make higher payments on my credit card debt.

I estimate that I’m about 8-10 (so, probably 14) months away from having no more credit card debt, assuming I can avoid any more vacation ideas or shiny electronics. I just have to keep reminding myself that all progress is good progress, and kicking myself accomplishes nothing.

Wish me luck.

(Normally, I’d say that luck isn’t even involved, here, but it’d be great if my employer got enough business in the next couple of months to restore our salaries to their original positions. The salary thing really hurts.)

Published or updated November 16, 2009. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Smithee formerly lived primarily on credit cards and the good will of his friends. He is a newbie to personal finance but quickly learning from his past mistakes. You can follow him on Twitter, where his user name is @SmitheeConsumer. View all articles by .

{ 10 comments… read them below or add one }

avatar Adam

We just paid off a computer debt that has been hanging over our head for about a year and a half. It feels great to finally “own” that thing even though it’s probably almost obsolete. We cut up our credit cards a few months back so we have been unable to continue to accumulate debt. It would be a hard pill to swallow if we paid off the computer debt and then added debt to another card. Good luck paying it off!

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avatar Evan

Smithee, while I am pumped you paid of the credit account…what are you doing?

“bought a Mac Mini to use in the entertainment center, and we got tickets for a comedy convention next year, and a paranormal investigation, and we started a corporation”

Corporation I understand…but a paranormal investigation? Mac Mini?

Your posts are so informative, and I am not one of those frugal extremists, but maybe a paranormal investigation?

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avatar Smithee ♦1,358 (Quarter)

For us, it’s a little mini-vacation.

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avatar Evan

I am not judging at all…just seems odd that in one paragraph you say,

“Now I just feel mostly guilty. I’ve still got a balance on what I call my “legacy credit debt” – the debt that’s been in various states of huge for over a decade, and which gets consolidated and moved around but never fully wiped out.”

and then the next one you say,

“I bought a Mac Mini to use in the entertainment center, and we got tickets for a comedy convention next year, and a paranormal investigation”

A quick google search showed that the mac mini is $600ish and a similarly powered PC would be $300 to $400 – that $200 is 10% of your debt that could have been gone with the same benefit of a new computer (which may or may not have been necessary).

All I am saying is that for me the guilt wouldn’t be worth it.

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avatar Blake

“I just have to keep reminding myself that all progress is good progress, and kicking myself accomplishes nothing.” -True that.

Best of luck to you Smithee! Do you by chance keep track of your progress in a spreadsheet, chart, etc? Visually tracking progress on a goal like this seems to do wonders in maintaining the self-discipline to keep going.

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avatar KC

Good luck! My first computer (a graduate school graduation present from my folks) was a 1997 Gateway laptop – it was $1500. I still have it and it still works. I occasionally play blackjack on it. My friends laugh at that clunky thing, but honestly I’m not sure what to do with it, so its my blackjack machine – LOL!

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avatar Scott

You’re telling me that you used a credit card to finance a paranormal investigation? Why am I reading this blog? What could a person who chooses to do this possibly have to teach me?

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avatar Smithee ♦1,358 (Quarter)

Fear not, Scott. I’m not the only author, here. Flexo has been much smarter than me about money, and blogging about it for six years. I have problems with saving and growing money, which is one of the reasons I’m blogging about it, to keep myself honest.

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avatar Evan

Scott,

Smithee is a GREAT blogger I’d recommend checking out his previous posts

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avatar Cyndi

First time reader here. Guess I’m a little jealous of the choices you’ve made – I’m dreaming of getting a Mac mini and I’d love to have a vacation. But I’m busy funding an emergency fund in case of unemployment next year.

Paying off one credit card and building up debt on another means you’re in exactly the same place you were before. The things you bought you could have waited for – they’re wants, not needs.. How long would it have taken you to finish paying off your debts and saving up to pay cash for the things you just placed on your credit card? Mind you, this is partially my jealousy talking – I want a new couch, a Mac mini, etc., etc. And granted, it actually hurts me a little more to take money out of my savings account to pay cash for something rather than pulling out the plastic — sure makes me think twice about what I’m buying…

But as long as you feel like you’re making progress, that’s the important thing – but don’t give yourself a false sense of progress – make sure the total amount you owe is less every month.

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