Each new position I took my income increased which I thought was amazing. So now I can take that trip to Florida or get that purse I have been eyeing for a year! I mean life was great and I was blessed. Three jobs later I was making enough to do those things travel, shop, dine out! But I still wasn't paying for those things in cash nor putting it on my credit card and paying it off at the end of the month. The credit card debt that I had accumulated over the last 3 years from trying to do normal things was holding me back. The whole time I was living my best life outside of my means and being responsibly irresponsible.
So here I am at 24 in 2017 trying to figure out how to pay off $10,000 of credit card debt. I decided to use my income tax money and savings to address the problem. Yayyyyy! Now I would travel and pay off my card like a responsible adult! It was my time to live my best life and nothing was holding me back. I started traveling internationally and attending grad school all while working my full time job. Except. Was I really living my best life within my means?
Fast forward two years later and I was finishing grad school and realized that I was now almost $20,000 in credit card debt and I still owed a little over $13,000 on my car (yep you read that right...I fell into the same trap as so many people around the world) but how?
The true question is was I being Financially Literate? I know your like "Kalai! What is financial literacy?"
Financial Literacy at is simplest definition is being able to manage your personal finances and understanding the impacts of your decisions in relation to your finances.
Alright back to my story. When I realized I was in debt the first time, I though I need to make more money but you see my original issue wasn't an INCOME issue it was a SPENDING issue. Not including my first job after college; my income was enough. The issue was that I was living above pay grade and the more money I made the more I kept increasing my spending. Often times people think they have an income issue which for many Americans is a problem but for the rest of us it is simple we spend more than we make! Once I realized this, I started aggressively attacking my debt. Today I am down to $6,000 in credit card debt and my car is paid off but who knows maybe tomorrow I will win millions and wipe out my remaining credit card debt and student loans. My journey and countless books and articles has taught me how to not only budget my money but those around me as well. I have helped several people get on track to financial freedom.
Thanks for reading my story! Please tell me about yours and don't forget to mention topics you would like to hear about in the future!
A Financial Fitness Inquiry is a free 20 minute call with me to see if Financial Coaching is the right fit for you while the Budget My life is designed for someone who is busy and does not have time for coaching at the moment but would still like to get their finances together. The consultation helps to set the ground work for you before I come up with a comprehensive 6 month plan to help you gain financial literacy.