As 2015 draws to a close, I am yet again in the shackles of credit card debt. How did I get here…again?
It’s confession time…
After I paid off my credit card debt earlier this year, three things happened that landed me back into the grasp of Evil Credit Card Company.
ONE – I fell ill with a health condition that required major surgery. I had an emergency room visit, many expensive tests and specialist visits. When all was done, I spent over $6,500 in out of pocket expenses relating to diagnosis. I thus more than maxed out my out of pocket limit for my high deductible health plan. I also spent an additional $3,500 flying my mom out here and housing us near the hospital for two weeks (long story) during and after my surgery. That totaled about $10k that all went on my credit card between March and October.
The good news is that once my insurance finally kicked in, it did its job. I got the courage to look at my medical bills once they came in. The actual surgery and hospital stay cost over $70,000! And I didn’t pay a penny of it. I had a top notch surgeon and state of the art hospital. I don’t know what I would have done if the insurance company had rejected any claims. Plus I got full paid leave from work for the entire time (6 weeks) that I was out. I know that some employers and insurance plans are not as generous. I’m aware that I’ve complained in the past about feeling underpaid at my job, but this is one example of just how valuable benefits are.
TWO – I spent $5,000 on plastic surgery. I know! I know! Put down your pitchforks, please. I wanted to get something fixed that had been bothering me for decades. Of course I’m only 50% happy with the results. I’m considering get a corrective procedure done in the future. Don’t worry, I’m not going to turn into the next Joan Rivers.
THREE – Overspending. I’m not proud of this. My food budget got out of control in the last few months. I tallied up my debt card transactions and I’ve been spending over $800 /month on food, takeout, junk food snacks, etc. One month, I spent over $1000! WTH!? I could so relate to Amanda @ Dream Beyond Debt:
Well, I knew my spending was out of control over the last couple of months. I reviewed my budget to get a better sense of what I need for baseline spending. Then, I printed off my bank statements for June and July. I combed through them and highlighted the superfluous spending.
Oh. My. God.
Over two months, I managed to spend $852 on coffee shops, restaurants, clothes, books, impromptu stops at the grocery store…
Let’s look at that number again: $852.
… I justified each purchase as I was making it. …
But as I enter a new phase of my life (which includes turning 40, taking a full-time position, experiencing the empowerment of paying off my loans) I’ve got to take a good, hard look at mindless spending. It doesn’t serve me. It doesn’t serve my dreams. When I saw that number ($852!!!) I immediately applied it to each dream on my list. That money could have really fueled momentum on any one of those dreams.
Yes, I need to regain control over my spending for 2016, kill this credit card debt AGAIN, and finally start focusing on my student loan debt which seems like a mirage in the distance that I never get to.
So, in total I have accumulated roughly $15,000 of credit card debt this year that I’ve been paying down. Thus, my credit card debt has been sticking around all this time. I now still have a $4,206.93 balance to pay off. I’m not happy about ending 2015 still in credit card debt but things could have gone even worse.
I’ll be making some plans for the new year to get back on track. Stay tuned.
“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)
I’m not sure how much you make, but with that much medical spending, you should evaluate if any of it would be tax deductible (I believe medical costs have to rise to a certain percentage of your income, depending on your age, that you have to itemize, and I’m not sure what, if any, effect paying with an HSA has). Hoping 2016 brings you fewer expenses!
I’ll look into that. Thank you!
Sorry to hear about your illness. Sounds like the benefits definitely helped, but an emergency like that can totally derail any debt repayment plans. But 2016 starts soon and you’ll have a fresh year to get a handle on everything. Fingers crossed for a safe, happy and healthy 2016 with no surprises to try and derail you again. 🙂
Yes, hopefully there will be no medical issues next year and I can focus on debt again. Thanks 🙂
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It could be a lot worse for sure.
I’m inappropriately curious, so if you suddenly feel called to share your plastic procedure, don’t hold back on my account. 😉
Anyway, as a hobby shrink, one thing I would suggest you consider is if the procedure was a form of self sabotage (and then explore why you would feel the need to self sabotage and how you can nurture that part of you instead), as it might have been possible to finally start paying down your student loans with that money. I MIGHT VERY WELL BE WRONG of course, and if it was the right thing overall for you, then yey.
I’ll be so excited to hear more updates from you!
Interesting theory. I don’t think so, though. I’m more than ready to start seeing the student loan balance finally go down. Thanks for welcoming me back!
Given all that you listed, I was pretty surprised to get to the end of the post and see that you only have $4200 in credit card debt. You must have made quite a bit of progress post-surgery. I’m glad you had such good insurance! As for the plastic surgery…probably not the wisest financial decision ever, but I’ve made a few of those myself, so. Here’s hoping for a much improved 2016, for your health and money both! I’m so looking forward to seeing you drive those student loans downwards.
Yes, I realized that I should not underestimate the value of benefits. I can’t wait to finally get at those student loans. Thank you. 🙂