Credit Card Debt – a little story…

Over the weekend, I was sitting on the train on my way to a baseball game. There were two women sitting behind me, and although I didn’t mean to eavesdrop (They were VERY loud!), I couldn’t help but listen to their conversation. My sentiments turned from feeling badly for them, to feeling confused, and finally feeling appalled. Here’s what happened…

Woman 1: I don’t know what to do. My landlady is threatening to kick us out because we were late on our rent check again. We were just 2 days late this time, but she always hassles us!

Woman 2: Oh man…can’t she give you a break?

Woman 1: Yah, she knows my husband and I are struggling too. We have so much credit card debt but all she cares about is money. Ugh – so frustrating. I hate dealing with her…and my husband’s not much better. He’s always spending his money the second he gets paid, but I tell him he needs to pay rent first! Right now, he’s obsessed with getting his truck re-painted, but I’m guessing he’ll put it on his credit card. At least we can deal with that later. The paycheck money needs to go to rent!

Woman 2: Yah definitely. It’s much better to just charge it and pay it back later. But don’t think about that stuff now – it’s good that we’re going to the game today. You need to relax and have some fun!

Woman 1: Yah, for sure.

Woman 2: So, does your husband know you’re coming with me today?

Woman 1: Yah, he knows I’m going to the game, but he doesn’t know that I’m paying you back for the tickets. He thinks you’re treating me, but don’t worry, I’ll give you the money as soon as I get paid. How much is it?

Woman 2: It’s $90. We’re sitting one section over from where we sat last time – Club Level.

Woman 1: Nice! You always get us the best seats!

Woman 2: Oh and I brought you $20 in case you need to borrow money for dinner. I know it’s been hard for you, so I took out a little more cash from the ATM.

Woman 1: Wow, you are so good to me. What would I do without you? You’re seriously going to make me cry. Thank you so, so much. I promise I’ll pay you back.

Woman 2: I know you will. Don’t worry about money, at least not for today. That’s my new mantra ever since I got laid off.  I’m lucky – when my mom passed away, I got money from the sale of her house. If I can help you now, I know there will be good karma for me later on. Besides, everyone has credit card debt anyway- it’s no big deal. It’s just part of life. We only live once so we might as well enjoy it, right?

Woman 1: Absolutely!

Now don’t get me wrong. I feel for the two women – I really do. I know how stressful it can be to live paycheck to paycheck…but maybe it’s because I work in the Financial Services industry or perhaps I’m careful about my own finances, but it COMPLETELY boggles my mind that you will pay for Club Level seats at a baseball game, but you won’t put that money towards paying down your debt! And what about hiding the truth from your spouse!? And did I hear correctly – you’re strapped for cash, but you plan on taking on more credit card debt!? I just kept thinking to myself – these ladies really need to get their priorities straight!

Anyway, the moral of the story is – you really need to watch how you spend your money. Credit card debt is one of the ugliest kinds of debt out there, and if you’re not careful, it can quickly get you into trouble.

Nobody ever said that getting out of debt was easy, but it is something that needs to be addressed. The longer you wait to deal with the problem, the harder it will be to resolve it. While credit cards have its advantages, you need to be responsible when using them. The key is to be conservative in your approach to debt. Never borrow money unless it is absolutely necessary and helps you accomplish a worthwhile goal. (Going to a baseball game is not one of them!) Also, get in the habit of monitoring your spending, and always aim to pay your balances in full each month.

Trust me, dealing with credit card debt is brutal – I wouldn’t wish it on my worst enemy. The high interest rates alone are killer, not only because you’ll be paying more money over time but it will make getting out of debt extremely difficult. My guess is that most people have no idea how much their credit card interest is actually costing them, but if you regularly carry a balance , you will likely pay more in interest than you did on your original purchase!

Over time, those $90 Club Level tickets will cost closer to $1,000!