• Carrie Kendon (Sanders)

Debt Is Normal

I was 18 years old. I had about $1,500 cash and was going to buy a used Nissan hatchback I found at a gas station in Charlottesville. It was ugly mud brown, but I could afford it. Upon pulling into the station, I pointed to my Dad the area where the car had been, but instead of a Nissan, there sat a 1989 Jeep.

It was red with a light grey hard top and I may have instantly fallen in Wrangler love. For sale, $7,500. I was $6,000 short. I wondered where the hatchback went and couldn't really believe someone else would have wanted to buy it that day. I didn't stick around for the answer. Before I knew it, my father had the keys to the Jeep and we were taking a test drive. "Dad, what are you doing? You are not buying this Jeep", I said. "No, but you can," he answered.

The next few hours were a whirlwind. I immediately saw myself in scenarios that included Jeep adventures on the open road. I was in a daze and before I knew it I had signed my first car loan note at the local bank and was the proud owner of a Jeep named, Sam. I began the day certain I would own a car that I could pay for in cash and ended the day "slave to the lender". My Dad just wanted his baby girl happy and in a reliable car, he didn't know the road I would follow for years to come. The day I got Sam was the first day of 24 years of car payments and many bigger, more ridiculous decisions to come that allowed debt to lead my life.

My first credit card was a Visa with a $300 limit, followed quickly by an AAFES card ($1,000 limit). Then a 1996 Nissan Altima ($220/mo) that I didn't really like and I traded it in later that year for a new Wrangler. That became my temporary beaus vehicle and I got a 1999 Honda Civic EX ($280/mo). I dumped her for a sassy 2002 Toyota Celica TRD edition ($350/mo) with 18" rims and a distinct sound. After visiting a friend in the ICU after a significant car accident and expecting my first child, I made the "sensible and safe" decision to trade up to a 2005 Volvo S40 ($500/mo). I am not entirely sure why I upgraded to the the Volvo XC90 ($610/mo) next but when gas skyrocketed to $5+/gallon in Hawaii and I was told the oil change would cost $1100, I made the super smart choice to trade the XC90 in for the Volvo V50 ($550/mo). I was saving $60/month in payment, more in gas, so I justified the decision. Also while in Hawaii we funded our desires with credit cards, because "we can make the minimum payments". I went on a cruise to Canada, met Joe in deployment in Singapore and vacationed in Mexico for my sister's wedding all on credit cards. We ate out whenever we wanted, mostly on credit cards and left the island in 2010 with about $60,000 in credit card debt and two large car loans. Did I mention, I had already taken a class that was designed to bring peace to one's financial life and even facilitated it a number of times? It may not sound plausible, but it was entirely true. And I didn't tell anyone because I was ashamed of being so far in the hole and also because I really have a vision that propelled me to climb out.

It may not sound plausible, but it was entirely true.

We moved back to Virginia from Hawaii and bought the right house, in the right neighborhood, near the right school for $1,850/mo. It fit our budget because all we thought about was making minimum payments. Of course, after moving in, we didn't think twice before spending a few thousand dollars on things we "needed" for our new house, and on a hundred other items we didn't really need. Life changed rapidly, our niece moved in and decided we needed more room. So, we made the intelligent choice and bought another house that cost $600 more per month. I often wonder why would a bank ever loan us the money for that second house but clearly, they knew we could make the minimum payment.

Within a few weeks of closing on that home, our homeowner's insurance company told us it needed a new roof and some trees were to be taken down or they would cancel our policy. Next, we had a heating issue and plumbing issues and within a few months a house with a barely comfortable payment had again increased our credit debt by another $15,000. Old house issues continued over time, too. About the same time, everyone seemed to be getting minivans with in car tvs and automatic sliding doors, so I traded the Volvo in on a minivan ($400). I justified it again like the Volvo, because I saved a little money each month on the payment even though it added a year on to the length of the loan. Add in private school tuition, Summer camps fees and everything else we said yes to, we topped out at almost $200,000 in revolving debt on top of the two house mortgages, making our net debt over $800K. We were Debt Millionaires.

We were Debt Millionaires

Forrest Gump said, "Stupid is as stupid does". If you want to know what stupid is, read the last few paragraphs again.

Thankfully, f new friends intercepted my life.

One day, one of my mentors asked if we had debt. I laughed. I mean, I belly laughed. I may have snorted. Did we have debt? We could be a made for TV movie on how to accumulate debt. The movie description might read:

1."How on earth can people go from zero to a million dollars in debt in six years time?"

2. "You have heard of secret millionaires, now meet their polar opposite."

3. "You think you have debt? Check out these dummies."

We could be a made for TV movie on how to accumulate debt.

Then, I was told about DebtBusters, a debt reduction program developed by Ron Reynolds, once the right hand man of legendary Jim Rohn. DebtBusters was provided free to all distributors, because not charging broke people to help them not be broke is honestly an incredible blessing. I was coached through the program and held accountable for knowing and reporting my monthly debt reduction numbers. I was shown how to make better choices with our monthly expenses, to say no to some niceties by keeping a vision of our preferred future in mind, and to intentionally put any available money toward our debt pay off plan.

In the past four years, we have eliminated over $400,000 in debt. By selling the first house we dumped $295,000. The other $100K was paid through proper planning, and consistent effort and focus over time.

Things we did to reduce our monthly expenditures and add to money coming in:

1. Put girls into public school for two years. (Saved $36,000 total)

2. Moved from most expensive house we owned and eventually to a rental. (Save $800/mo)

3. Sold one house. Other is in rent-to-own contract (No unexpected homeowner emergencies or repairs) (Saved lots of $)

4. Set a cash based budget and have discussions as the pay cycle goes to make sure we are on track.

5. Plan for regular non-emergency things like tires (all cars end up needing them) and Christmas (it comes every year, same day actually).

6. Stopped living on credit cards.

7. Pursued an additional source of income

8. Began to dream about life without debt

9. Wrote our goals and made a vision board

10. Started living unapologetically, passionately pursuing a preferred future

The debt left to go:

1. House #2 is on a rent to own contract and has equity. Technically we "owe" on the house still but when sold we will make out on the positive side by at least +$40,000. This is like forced savings. It will feel like a reward at the end of our debt pay off journey.

2. Cars. Joe's Jeep is on the market now. We will purchase a used sedan in cash. The choice I meant to make in 1995, the one to pay cash for my car, that is the one I will finally do.

3. $100,000 other debt left. $100K is the number to beat. This is the current goal - the amount to eliminate before Joe retires and we head out on our RoadSchool adventures. It's good to have goals.

It's good to have goals.

When we are debt free, we will only look back to remember where we once were, so that we can continue to share our story. Our debt story is utter ridiculousness and absolutely true. If debt is normal, we were the most normal people in existence.

If debt is normal, we were the most normal people in existence.

We may still have some debt now but we are no longer normal; we are different. Not having debt is freedom, but simple freedom from debt isn't enough for us anymore. Now that we can see past the haze of our years of racking up debt and have been digging our way out we can see a new horizon. One day our rags to riches story will be finished and we could be a made for TV movie on how one couple completely changed their perception about money; from middle class thinking to a millionaire mindset. The captions of that show might be:

1. "How they went from a million dollars in debt to a million in the bank without hitting the lottery".

2. "When keeping up with the Joneses became obsolete."

3. "How one Navy family chose to dismiss the naysayers, dive into a home based business, learn from people who had what they wanted and taste the real freedom they fought so hard for."

When keeping up with the Joneses became obsolete.

For now I will leave you with this, sometimes circumstances happen to us, sometimes we make them happen, either way the only way to get out of a pit is to start climbing. Up we go!

I don't lie and neither do these numbers.

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