Officially Debt Free

I lost my job in June 2013. And I started a new position on September 3rd, 2013. I checked my Weekly Financial Summary email from Mint.com on 9/7/2013, I owe $846 to Chase, $2,616 to Citibank, $2,768 to Discover, and $3,303 to American Express. That is $9533 in debt. And my net worth at that time, was –$8,504.

This morning I opened my email, to realize that I owe Citi $135 and Amex $174, Chase and Discover 0. And my net worth, is not negative anymore.

Undoubtedly, that was a long way to go. And I have to thank my family for their support(mostly financial, little mental) during my jobless period. But I am also proud of myself, being able to stand up to the debt, also being able to take the action and discipline to clean it.

I never worried about money too much in my life. My family have been doing reasonably well financially, so I had been living a relatively comfortable life comparing to my fellow classmates throughout my academic life. I was rather recklessly spending a lot on fancy restaurants, clothing, traveling, and a lot other stuff I cannot even remember why I bought them – because I don’t need them at all – with the notion that if I end up having problems to afford them, I can go back to my parents, they will help me paying my credit cards and I will clean the debt in a heartbeat.

I know they will if I ask. But I simply can’t go back. Not only because if anyone pays you money, they will have the right to tell you what to do – which I will not be able to tolerate as I grow into the person I would like to become – but it also gives you a perception that you don’t have to take responsibility for something you have done, that you don’t have to consider the consequences before doing all the spending. That will eventually hurt your ability to make a judgement, because as a mature adult, you cannot make a wise judgement if you don’t have to consider the consequence – it is not even a valid judgement. And what separates boys and men is how you make decisions, for yourself and for people around you.

And I have been listening to Dave Ramsey show for the last week. This is a cynical man hates “modern society”, but he does have a lot wisdom dealing with money and wealth. I realize that up to this morning, I have completed step 1 and 2 in his “7 baby steps”, and am already on step 3. Personally, I think you will be doing well financially if you do follow his steps, because these steps take discipline and determination to carry on executing. It keeps you away from those “rewards” and “miles” but only limit your spending on essential, fundamental things.

How important this is you might ask? This is important because when you only need a certain amount of money(which usually wont be too much for us ordinary people), you will not spend all your time trying to gain more wealth, but rather spend them on things really matter to you, not how to get a better FICO score so you can get more mortgage and to buy more stuff to get even better FICO score to get even more mortgage etc etc. That only matters to GDP growth and US government. And you can do better than that.

On the other hand, you might have the hippy attitude that money is shit. Money is not shit. It is just one part of life, like other parts of our lives, you cannot simply put a “good” or “bad” label on it. It is what you need to survive, like you need food to survive. But will you spend all your time getting more and more food?

As I grow, I realize that a lot people are trying to make more money only because of their insecurity. They are trying to grasp something to relieve their anxiety, and money is the most visible straw. Money is never the solution to your anxiety and insecurity, or a relationship with the best man/woman in the world, or “fitting in the crowd”. Sit back and ask yourself: what matters most to you? what kind of person you would like to become? and what you can do for this world?

From there, you are on the way to find the solution.

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