Should You Pay Off All Your Debt? - youramericanmoney
Author: Michelle
Description: In this conversation I answwer the question "Should you pay off all of your debt?" I've been thinking about this question a lot lately.
Date: 2021-07-19T09:00:00+00:00

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# Should You Pay Off All Your Debt?

posted on 19 July, 2021

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At the beginning of this month, I paid off the last of my unsecured debt. I also paid off one really embarrassing business bill that was impacted by my personal money mindset issues. For those of you who are new to me, I began paying off over $60,000+ in unsecured debt in earnest about 8 years ago. The journey has been slow and steady with moments where I just stopped because I was just tired. In hitting this huge milestone for me I thought it was important to recognize this achievement but also to have a deeper conversation about how debt impacted a number of areas in my life that I truly didn’t anticipate until I hit the $5,000 mark. Before I get deeper into this conversation I do want to share a disclaimer that I am NOT giving financial advice, this show is for entertainment purposes and that you must do your own due diligence before making financial decisions.

*In order for me to support my blogging activities, I may receive monetary compensation or other types of remuneration for my endorsement, recommendation, testimonial and/or link to any products or services from this blog. Please read my disclosure here.*

## Show Resource

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## Listen to the Show

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## Show Notes

- Sometime in 2012 I decided to get serious about paying off my debt. I’d spent several years prior reading blogs about other people paying off their debt and I have to admit-they inspired me.

- And even though they were candid about their struggles and frustrations nothing prepared me for how hard it would be to pay off MY debt.

- I knew going in to this journey that it would take awhile. Fortunately, I had connected with a number of people who were in the process of going through long-term financial journeys. Some were 5 years into it, 6 or even 7 years into debt payoff journeys.

- In the past couple of weeks I’ve thought long and hard about was it worth it? To sacrifice in the way that I did? I have some thoughts.

## Should You Pay Off All Your Debt?

- In the beginning of my financial journey I had over 30+ bills. I need to be candid and say that a lot of details around my debt and financial situation during that time has gaps in it. I literally don’t remember everything because I was under so much stress.

- Financial stress and obligations meant that I had to stay in a work situation longer than was healthy for me until I no longer physically could stay. Once I started having obvious anxiety attacks, constant migraines and depression my health and well-being was more important so I took a leap of faith.

- I finally put in my notice after 2 years of trying to make the decision. At the same time I booked a plane ticket from Denver to LA, LA to Oahu and then to Sydney, Australia. My last day was December 14, 2014 That plane departed on December 16, 2014. By the way, I gave a 4 month notice (I don’t recommend this) but I did that because I was the only person who worked on immigration for the students in the program that I worked for and didn’t want to screw them over.

- It took me a year to physically recover from the amount of stress that I was dealing with at work.

- I’m convinced that if I hadn’t been under so much stress, I probably wouldn’t have made the next decision. I decided to work for myself. I wasn’t an entrepreneur in the sense that I had products to sell. I just provided services as a virtual assistant, social media assistant and did a host of other things. I hated it all. Around this time I started a side hustle as a Brand Ambassador. To this day, I’m so grateful for this job, the community that I connected with and the friends that I made.
  - Because of the financial allies in that space who gave me extra hours, drove me to gigs, and told me about new programs I was able to build my business.

## What About the Debt?

- Well, it still was there. And it was so complicated. In fact, one of the conversations that personal finance influencers fail to address is how financial complexity impacts ones ability to clean up a financial mess. It’s one thing to pay off $40,000 and it’s comprised of 3 bills that are in somewhat good standing.

- It’s a totally different situation when you’re dealing with 30+ creditors with:
  - Some debts in good standing
  - Most in arrears
  - Different interest rates
  - The level of urgency varied depending on what was going on with the bill.

- Making money in my business wasn’t an issue, but cash flow was and that consistent cash flow made paying off my debt a lot more challenging.

## How Was I Paying Off?

- I didn’t stick with one philosophy of debt repayment and I used what I would call an energetic repayment system.
  - I paid off the bills that stressed me out the most. You know the ones that would keep me up at night.
    - People that I owed
    - Companies that kept calling
    - You get the drift

- Whenever possible I would make a large payment and just pay something off so they would just leave me alone.

- And I would do this over and over again.

- No one told me how I would change during the process. That the role I played in my friend groups would change.

- Or, that I would become increasingly aware of how much being in acute financial distress impacted
  - My self-esteem
  - My relationships
  - My choices

- No one mentioned that it would take awhile before I would begin to notice, truly notice the impact of getting my money together.

## What I Learned About Money

- My decisions weren’t just impacted by
  - Ignorance
  - Hubris
  - Lack of clarity
  - Dumb financial moves

- Many of my money decisions were made because of fear.
  - Of not being like everyone else
  - Of being afraid of “what THEY” would do to me if I couldn’t repay a bill.
  - Of losing what little comforts I had

- I learned that some of the struggles with money that I was dealing with were connected to the lack of government policy.
  - Basically I had no safety net but me and it was incredibly frightening.

- Earning more is not talked about enough. No one ever talked to me about HOW MUCH I should earn. I just learned to work. Those are very different conversations.

- Murphy’s Law exists and every time I was close to hitting a major milestone-some crazy sh$t would happen.
  - I was served not 1, not 2, but 3 times to go to court over credit cards. And I would sit in the court and see all of the Black, Brown and some poor White people sitting in court just looking defeated. I was too tired and overwhelmed to do my due diligence on those bills.
  - That $400 average Murphy’s Law amount-it’s real.

- Money is incredibly emotional for some people. That would be me. I’m some people. I have a lot of emotion connected to my money interactions.

- There’s a point when you want to quit or keep going.

- There are a lot of people out there with a ton of bad takes on money. They are a distraction and it’s important to ignore them.

- Each financial skill takes a lot of brain energy and focusing on several skills at one time is extremely difficult to do.

- The less I owed, the more my money seems to grow. I’m just able to focus on being deliberate with my finances and am not constantly in financial struggle mode.

## My First 5 Figure Month

This month I’ve earned over $10,000 and there is still a couple of weeks left in the month. I’m acutely aware of all of the hard work and sacrifice that I’ve done to get to this point.

- Opting to stay in my awkward property because even with carrying costs it was affordable. Happily, I’m finally in the process to renovate it and give it a long overdue facelift.

- Using a car share program saving me between $8,000-$9,000 in car expenses a year. This year I’m using the service quite a bit for road trips.

- Putting the breaks on overseas travel and enjoy local travel throughout my state. I stayed in my favorite posh hostel and cute local boutique hotels that enabled me to travel to some of the nicest mountain towns in the world.

- I learned how to manage my wants and reimagined constantly how I could enjoy the same things while paying less. Basically, I focused on impact. Did what I was doing bring me joy? What was more important? The experience or the “bling” around the experience?
  - Going to Yoga? Instead of having an ongoing yoga membership I would go to free classes offered by my city then I would take a Yoga on the Rocks class at Red Rocks (it’s awesome)
  - Eventbrite and Facebook events became my best friend-I found so many cool free and low cost events to enjoy while on this journey.
  - Did I want to watch a movie? I would go to Movies on the Rocks (I love Red Rocks)
  - My Brand Ambassador gig allowed me to go to cool and fun events across my state. In fact, one of my favorite gigs that I did for years would book events in the mountains where myself and the team lead would stay overnight in the mountains. I loved it because I love going to the mountains.
  - I ate organic and still shopped at Whole Foods. But, I would take advantage of the summer farmers markets and go right before they closed so I could get 2-for-1 deal.
  - I applied for scholarships and grants.
  - And I volunteered and spoke at conferences so that I could attend for free while growing my business.

## The Truth About Long Financial Journey’s

- They can be very difficult to do.

- I understand why people quit. I stalled out at the last $5,000 in 2019 and then COVID hit. I was stalled out until Summer of 2020 and I just had to give myself some grace. I was just so dang tired.

- Most people change. I’ve noticed that the habits that I’ve built are unlikely to go away.
  - I have what I consider financial PTSD connected to all of the stress connected to the debt. In fact, something came up this Spring and I had to reach out to my friend Sandy to get her feedback. I knew I would react emotionally and potentially make a bad decision. So, I reached out to a friend.

- You will lose friends and gain friends during the process. You’re changing and you’ll discover your role in your friend group as you embrace your financial changes.

- You’ll still make financial mistakes, you’ll just make fewer mistakes.

## So, Was it Worth It?

The short answer is yes. Yes, all of the struggle has been worth it but I do think that there was an emotional cost for me that I’m still navigating.

- I knew the journey was worth it while I was sitting in my home during a world wide pandemic. I was at the tail end of paying off my unsecured debts. I wasn’t worried at all.
  - The years prior to 2020 paid off during the one year where I needed my financial house to be in order.
  - I basically had to focus on staying alive and earning money. The financial stress of previous years wasn’t there.

- I very rarely get snail mail.

- No emails about debt

- I’m dealing with fewer people and entities and I FREAKING LOVE IT

- My home feels lighter and I’m very careful aware of my financial values.

- I was able to purchase a new Mac cash-without worrying that the money was allocated for something else.

- I’ll be able to invest and save at a significantly higher rate moving forward. Think a minimum of 30% of my income or more.

- My choices and opportunities have expanded significantly

- I feel like I’m finally on equal footing with the people around me and I’m open to dating and am comfortable having the financial conversations you will eventually have when you’re boo’d up with someone. My relationships are stronger.

Now, I just have to take care of those student loans.

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#### Michelle

I am an obsessive foodie, but not self-righteous with it, love travel, meeting new people, helping you look good, and am freaked out by people who don't enjoying reading...something! Grab a Perrier, read my blog, feel free to drop me a line! Hope to hear from you soon.

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