While I was in my 20’s, I didn’t think my financial habits were completely terrible. I tried to stay away from using credit cards. When I did use credit cards, I tried to pay off the balance as quickly as possible. Even though money was tight, I was always able to pay my bills on time.
However my financial habits could have been a lot better. I had about $16,000-$17,000 in student loan debt from college (mainly from graduate school). I wasn’t earning a lot of money yet and started using credit cards when I didn’t have the money to pay for things.
By the time I was around 30 years old, I really started looking at my finances. I had finally landed a full-time position teaching at my local community college with an actual salary for the first time in my life (I had been skating by with part-time jobs due to having 3 small children). I started looking at the possibility of buying a house. I decided to look at my monthly bills and see where I stood financially to figure out how much house I could afford. This caused me to finally analyze my debts. I decided to calculate how much I was spending solely on interest each month and came up with a figure of around $100-$150. I thought about all the things I could do with an extra $100-$150 each month. I realized that I might as well have been flushing that money down the toilet because it wasn’t doing anything for me. It was my “A-Ha” moment regarding finances and debt.
Please comment below if you had any “A-Ha” moments regarding your finances.