You Are Not A Victim of Debt

Through the last few years of blogging about finances, I've found that their are lots of types of people in debt. There are those who are overly optimistic who set completely unrealistic goals, don't hit them, and just set more. Some people have taken on a calculated debt, and are aware down to the penny of what they have and how many days it will take to pay it off. Others ignore debt completely, living in denial and never wanting to talk about it, often continuing to incur more debt. There are those who have recently paid off debt, and are so excited to share with the world that they're debt free. Others are confused, willing to learn, but don't know where to start (this was us when we got married). 

There are also many (that are most often attracted to talking about debt with me) that feel they are victims of debt. These ones have a story to tell about how they are in debt, couldn't help it, and want me to listen to their story...they don't want advice, they want me to give them affirmation that it wasn't their fault they are in debt. That way they can stay in debt and feel justified. 

Here's the thing.... you are not a victim.

You may be in my "pretend victim" category if you're reading this and saying "She doesn't know what she is talking about." Followed by a phrase such as:

• "We couldn't help it, We didn't expect to pay so much out of pocket for our baby's birth."
• "We had to take out so many student loans, how would we have known the job market was going to be so awful?"
• "There is nothing more I can cut back on, we are spending as little as we can"
• "My husband racked up credit card debt for years and I had no idea...it isn't my fault"

If you're a "pretend victim"... you're probably already mad at what I'm saying. If I've offended you, well then, okay. But if you are offended and still want to get out of debt, I'd suggest you read on. This is coming from a place of love, I promise. This isn't a soapbox speech (I'll admit to it when it is) however, it may be a little tough love.

To those who feel they are a victim of debt, here are a few thoughts: 

Emergencies happen, but most of them can be handled or minimized by planning. This is what the emergency fund is for. At all times, you need to have an emergency fund. We did not have an emergency fund set aside in a separate account when we were paying off debt, but we did have a limit to how low we would allow our bank accounts to be. We always kept the account with at least $5,000 in it. However, since then we have learned it is important to have that money in a separate account (This is me admitting we were far from perfect in our journey to pay off $100,000 in student loans) Depending on your financial obligations, your emergency fund should be relative to that. Read more about Emergency funds here.

The Jones's are liars. Most people that I've come across that fall into the "pretend victim" category are very concerned with keeping up with the Jones's. Whether it is clothes, cars, houses...they want what their friends have. Here is my philosophy: 90% of the people you come across that you think are better off than you, are probably in debt up to their eyeballs. It's the people driving around in the 16 year old Honda with 200,000 miles that are the ones out of debt, and have the freedom to be without a car payment in the world. You must learn to love the freedom of being debt free more than the love of expensive things. You can have expensive things some day...but not until you've worked for them. We've had friends tell us they would love more than anything to be able to have the money to travel like we do,....but they are the same people who look at me like a crazy person when they hear I spent 12 hours on my birthday, new years eve, or any other Saturday photographing a wedding. They also made jokes when we told them we couldn't afford to go out to eat when we were paying off debt. You can't have one without the other. So one good takeaway is that you should never compare yourself to other couples and how they appear to be doing financially on the surface, they may be one month away from having their house foreclosed on.

You CAN cut back. Even when we felt like we couldn't cut back on expenses any more than we were....we still could. As Dave Ramsey would say if you're not eating "rice and beans, beans and rice" then there IS something you can do to cut back. Get creative, be willing to sacrifice, there is always a way to cut back on your spending. You can read some of my Money Tip Lists that we posted when we were trying to get out of debt. 

You CAN make more money. Getting out of debt is HARD. Yep... I said it. It is SUPER hard work, and anyone that tells you otherwise is lying. You may work 12 hour days, 7 days a week...and it is going to be miserable....but you CAN get there. Wait tables, mow yards, work part-time at a retail store. While we were getting out of debt I was working full time as a new lawyer, running a photography business that took about another 30 hours a week of my time, working as a contract photographer for other organizations, running an Etsy shop, teaching an MBA class, and working at a retail outlet (not all of these were at the exact same time, but many were). I'll be the first to tell you it was hard. At first, I did sit and pout like many of my legal peers about how my job as a lawyer wasn't paying as much as they told me it would when I entered school (I was paid less than a 1st year teacher hired by a Nebraska public school*...which is not what they advertise going into law school) But when I made the decision to find money other ways, I enjoyed my career and my job so much more than I ever had! It was all mental, and I decided I was going to make money other ways because I wasn't a victim of the bad job market. 

You're an adult, what you're doing now is going to affect the rest of your life. This means no excuses about why you can't start planning for retirement now. It means racking up credit card bills you can't pay isn't going to just magically get paid off when you have a better job, or when you come into inheritance from your family. In Nebraska, you're legally an adult at 19 (other states 18). For some reason we like to pretend you're not a real "adult" until you're out of college and on your own. Wrong. If you're old enough to get a credit card on your own, you better be old enough to start managing your finances.

Here is the bottom line. If you have debt, that means you decided you were entitled to something you hadn't earned yet. Harsh... yes. I didn't say there was anything WRONG with that, I took out debt, as did Kevin! We even are making plans to take out debt again, to purchase a home. But the truth is, when we take out a mortgage for our home...we are doing it because we haven't worked enough yet to pay for the home. We decided we are entitled to have something I haven't earned yet. That is what debt is!

Note:If you are married "you" means either one of you, since once you decided to tie the knot you became 1 entity in the eyes of debt collectors. 

Here are a few of my responses to the most common stories I get from those in debt who fall in the "pretend victim" category.

• "We couldn't help it, We didn't expect to pay so much out of pocket for our baby's birth."Did you have an emergency fund? Did you look at your health insurance when you found you were expecting to help determine the costs? Did you really NEED all that new baby furniture? 
• "We had to take out so many student loans, how would we have known the job market was going to be so awful?"Are you working 2 or 3 jobs to help supplement your income while you work towards your higher paying dream job?
• "There is nothing more I can cut back on, we are spending as little as we can"Things you likely can immediately get rid of to cut back: Sell your car if you have a car payment, get rid of cable, bring your lunch to work, eat rice and beans, downsize your mortgage/rent (or get a roommate), and do not even think about going out to eat.
• "My husband racked up credit card debt for years and I had no idea...it isn't my fault"Did you run a free credit report each year on both you and your spouse? If so, you would have seen this. Now is the time to get on track and on the same page. 

So let's summarize. If you're feeling like you're a victim of debt...okay! Take where you are right now and decide you don't want to be there anymore. Decide that you're not going to feel like a victim, but you're going to make up your mind to get out of debt now. Get ready to work hard, and see that work pay off in a real way once you become debt free!


*Lincoln Public Schools in Lincoln, NE posted that in 2013-2014 a first year teacher made $39,143 with a bachelors degree or $41,231 with a masters degree. This assumed you are working 9 months out of the year. Working year round (as lawyers do) you would be making $52,190/$54,974 respectively.