How did you get into debt?

[milkandcookies]

I wish I could tell a story that would give you more sympathy, but my debt all came from myself and my own young stupidity. I didn't understand how credit cards worked and played with all the "free money" that was available to me. $20k later, I am starting to pay it off. I.m embarrassed about it, but I now own my mistake.

How about you? How did you get into debt?

[Weird Tolkienish Figure]

I wish I could tell a story that would give you more sympathy, but my debt all came from myself and my own young stupidity. I didn't understand how credit cards worked and played with all the "free money" that was available to me. $20k later, I am starting to pay it off. I.m embarrassed about it, but I now own my mistake.

How about you? How did you get into debt?

Bought a house and car. Things I needed.

[Bob B.]

I got into debt because my spending exceeded my income.

At its maximum, my CC debt was about 24K. And, it was probably more than that. It was 24K when I started paying attention.

That was 4 1/2 years ago, and I have my CC debt under control, but it's still a struggle. I received a lot of help from members of this site as I decreased my debt.

There are only two ways to address you CC debt problem - either cut your spending to bare bones, or increase your income. And, really the best way is by a combination of the two.

If you list a detailed budget - income and expenses for one month - there are a lot of people here who would be willing to help you out. Also list all of your debts (CC, vehicle, education, housing), including interest rate and minimum payments.

Good Luck!

[disneysteve]

How about you? How did you get into debt?

Student loans, mortgage, car... all stuff I/we needed. I've never carried credit card debt. Well, that's not entirely true I suppose. We did do 0% financing on some furniture years ago which I guess technically qualifies as CC debt.

At this point, all we have is the mortgage (just under 50K) and less than 10K on my wife's car that we bought late in 2013.

[LittleMissSplendid]

A lack of financial education, poor planning, and spending above my means are all culprits for me.

[Petunia 100]

I entered credit card debt hell by saying "I do". It took about 10 years of scrimping and juggling to claw my way out.

My current debt is from buying a house and a car. Neither of which I really needed. I bought my house to give my kids a sense of permanence and security post-divorce. It accomplished that, but it certainly has been costly.

[bjl584]

Student loans, mortgage, car... all stuff I/we needed. I've never carried credit card debt. Well, that's not entirely true I suppose. We did do 0% financing on some furniture years ago which I guess technically qualifies as CC debt.

At this point, all we have is the mortgage (just under 50K) and less than 10K on my wife's car that we bought late in 2013.

Have you ever considered liquidating some funds and just paying off your debts just to be done with it?

[disneysteve]

Have you ever considered liquidating some funds and just paying off your debts just to be done with it?

Yep. I've thought about that. The house is at 3.99% minus the deduction which makes it an effective rate of about 3%. The car is 2.something%. It just doesn't seem worth it. My funds are doing far better than that. Plus if I sell taxable holdings, I'm going to get hit with a tax bill on top of it.

Neither payment is a big deal. I'm prepaying the car so it will be gone soon anyway. And at this point, we're paying more principal than interest on the house so prepaying now doesn't save us nearly as much as doing it earlier would have.

[JoeP]

The subject of basic financial education has come up millions of times here. When you don't know how debt works, you might be one of those people who tell the used car salesman how much you can afford each month, and then end up with a 6 year car loan. Or you might get a 30 year ARM with 5% down. Or you might not keep a budget and wonder why you're always near broke.

[colejacharris]

Being alone in the military raising my daughters for about 10 years Nearest family was across the united states so I did everything on my own.
I don't necessarily regret how I managed finances though and I was fairly educated in how it all worked at a young age so I knew what I was doing. Something as small as monthly childcare expenses really took the breath from my ability in giving them more and overall cash flow.
I made choices such as CC's for school clothes every year, a fridge and microwave (way before craigslist time) etc. I used them for about 7-8 years until I discharged from the military and got myself into a pretty good company where I was able to get rid of it.
I knew I needed to create a credit history though and now it gleams pretty brightly on my reports that I have such a long credit history at such a young age.

[ladonnarosso]

We don't carry consumer debt, but have our mortgage and student loan debt. In our area, owning is much more cost effective because rents keep going up! I have had a steady mortgage payment of $915/mo while rent for similar accomodations is around $1350/mo at this point. The mortgage debt (131K) is worth it to me for the benefits it provides us.

Now the student loan debt (45K) belongs to my husband, but it is now ours. He spent a year at a private college, graduated from a state school, and then went back to another school to get a teaching license. All told, spent about 8 years in college, which is expensive. We are both now working to get rid of that debt, but it feels like it is going to take forever!

[MonkeyMama]

I bought a home. I don't know that I "needed" it, but it made more financial sense than renting.

[hobo2]

Homelessness. Had a very good FICA score and zero balance on both cards before I decided I'd had enough of the way the homeless shelters were treating me.

[midlifefinance]

I got into debt when our house is being renovated. But it was not a mistake, the debt is really intended for the house and I'm slowly paying it off.

[williamsnancy]

I was an impulsive buyer before until I went into debt. Sigh