5 Life Lessons I Learned When Paying Off $56,000 of Debt
I thought paying off $56,000 in debt would be an accomplishment on its own. Little did I know the major life lessons that I would learn from the process of paying off debt.
Back in 2010 I had come to a crossroads in my personal finances. I felt like I had nothing to show for all the hard work I had put in my 20s. I was dealing with a financial hangover that included a car loan, credit card debt and student loans. Watching my Cuban grandmother balance her checkbook and thinking of all the sacrifices she and my grandfather had made leaving their country and starting over, I felt like I was throwing out the opportunity that they had given me. It was time to make a change.
So I got some information about budgeting and paying off debt, set a plan and, five years later, finished paying off $56,000 of debt. The road to paying off debt was not easy. There were setbacks — job loss, move, foreclosure. However, through this process, I learned so much about myself and what I was capable of accomplishing. While I wish I would have never gone into debt in the first place, the life lessons learned are ones that I will not soon forget.
1. Good things come to those who wait — or are patient.
Patience is not one of my strong suits. You know the saying “Be careful what you wish for — you might just get it”? Well, I found that asking for patience only leads to being put into situations where your patience is tested. Paying off debt is not an overnight process — there are only so many things you can sell, expenses you can cut and hours you can work. Being patient in the debt payoff process and all that life chooses to throw at you in that time period is essential to staying the course and being motivated to reach your goal.
2. Appearances are deceiving.
You may think that everyone around you has their finances in order but more times than not, this is not the case. When I started telling people about my debt payoff journey, I found out that many others were in the same boat — or worse — than I was in terms of debt balances. People were willing to become more transparent about their day-to-day finances once I opened up about my own struggles. I found that many people put up a false front that they are doing well when, in fact, it is all built on a bed of financial lies.
3. Give less importance to material possessions.
I thought I was not a materialistic person before getting out of debt. But when I look at all the shoes and clothes and travel that I racked up on credit cards, my priorities were clearly out of line. Once I had the “I’ve Had It!” moment with my money, suddenly buying a new dress or paying for a killer pair of shoes was not worth it. When you go through the hard work and sacrifice to pay off your debt, you become keenly aware of how you spend your money and how it could be better served than using it for frivolous purchases. I’m not saying I don’t appreciate the finer material things in life — I just don’t find that I need to have those items anymore.
4. Invest in yourself.
One of the best investments you can make is in yourself. What do I mean by that? Your income is your greatest wealth building asset. In order to keep building your income and value in the marketplace, you need to be continuously learning and growing to stay competitive. Just because you may be finished with formal schooling does not mean that you should stop learning and developing your skill sets. There are many ways to do that — books, seminars, training, etc. Many of these options don’t have to cost a lot. See what resources your company offers and take full advantage of the training they provide. Making yourself more marketable will allow you to move your career forward or possibly take a different path.
5. Always give — no matter what your financial circumstances.
Giving has always been a part of my life. I was told growing up that there are always people who are in worse circumstances than you and that there is no excuse to not give. It builds our character and allows us to focus less on ourselves and more on others. It doesn’t always have to be financial — it can also be your time or your talents as well. When I was getting out of debt, I always made sure to include giving as a line item in my budget. I couldn’t give as much as I wanted to at the time but I reminded myself that when I got out of debt, there would be some amazing things I could do with money to positively impact the world.
Getting out of debt is more than just a mathematical equation. It was a mindset change about how money works in your daily life. The life lessons learned while getting out of debt will have a lasting impact on how you make decisions about money and, in turn, how you make decisions about your life.