Let’s face it when you want that nice car, or when you want to make your first purchase of a house what is one of the things they ask you? “WHAT IS YOUR CREDIT SCORE?” You can start to build your credit by simply applying for a Bank credit Card. I started to build my credit at the age of 18. On my 18th birthday my mother made me apply for a credit card. I was in high school and I will never forget the words she told me “ In order for you to buy a nice car or buy a house and not need nobody to sign for you; you need to have good credit.” I didn’t really care about credit for a car or a house. I cared about the SHOPPINGGGGGGGG. I’m a bit of a shopaholic. I like to buy clothes and make up, it’s sort of my thing. But besides that she told me she wanted me to have credit and that she wasn’t going to cosign for me. I was like how the hell am I going to get approved for credit if I don’t have credit!!. Well at the age of 17 I started working at the GAP. One of the important things they ask you when applying for a credit card is income. At that age I was making about $11,000 a year and the first credit card I was ever approved for was for CAPITAL one with a credit limit of $200 dollars. The way you build credit is by using the credit card and simply making your monthly payments. Not paying it in full but by paying it in three payments. They want to see that you are using the credit but also paying ON TIME. You keep doing that over and over and boom you slowly start building your credit. Now the issue was not that 200 dollar credit card. The issue came 2 years later. I was starting to get approved for credit cards with $5,000, $6,000, $10,000 credit limits. In my mind I was like woah FREEE MONEY. But my mother always told me “Janibell DO NOT USE THE CARDS UNLESS ITS AN EMERGENCY”. Yes I did listen to her and I did not use the cards at that time. Yes, I did shop and I will pay them back. But then the age of 19 when my mother passed away I became very depressed.
I was broke, I had no home, she left me with a 2000 Honda accord that was always breaking down on me, and I just said “FUCK WTH am I going to do?” I was working like crazy making only 8 dollars an hour. I used to work at Express, Aldo, and the Gap. All these stores and barely made any money. I was a full time student in college, had no home, and was just completely depressed. I will have to go to class in the City and then on the weekends come back home and bar-tend at my aunts and uncles bar just to make enough money to go back to New York where its expensive as hell. I basically had to make a living to survive. But problems with the credit cards did not come then. The problems with the credit cards started to happen my third and fourth year of college.
I ended up finding a job where I was no longer making minimum wage. I started to work for L’Oreal selling perfumes. Since I was making a little more money and was an Independent Student, FAFSA did not want to offer me any grants or financial aid. I knew that dropping out of school was like not an option. I said to myself “well I have credit and I have a job. Loans will pay for school now and whatever they can’t pay I will put on my credit cards” I was not really thinking straight but the only thing I knew was I have to make my mother proud. Everything I was doing at the time was for my mother. I ended up saving money but silly me I didn’t save money for the right purchase.
I saved about $16,000 and I told myself I am going to save money to buy a car and my first car purchase was going to be my mother’s dream car. She always wanted a white Audi. I always used to tell her that when I graduated college I will be making enough money to buy her her dream car. I ended up saving money and Yup just like that I saved the money and put it all for a down payment . (Instead of me buying just a regular car not a $50,000) . The dealer was also giving me a hard time because they said “ you’re only 20 years old where are your parents? “ I had the credit, I had the money, and I had the job ( they ask for your W2 and paystubs) Because that was my first “BIG” purchase on my own and I was only 20 at a dealership not having a clue of wth they are selling me I made the worst purchase ever.
MISTAKE #1. I gave them all my money and they sold me a lemon car. A year later the car started to break down on me. I was just completely pissed!. I went back to the same dealer flipped out on them and because they KNEW they completely jerked me they gave me a lease a brand new 2014 no money down ( again when you have amazing credit they give you everything with no money down). I get to drive away with a new car no money down ? sure I’ll take it. ( I STILL LOST ALL THAT MONEY I PUT DOWN ON MY FIRST CAR). Right there I got myself in automatic $45,000 debt with a car and all the money I spent that first year on my car GONE.
Now my Junior year of college I knew that in order for me to make it In Corporate America in the Cosmetics industry I needed to have a super strong resume. Working retail was not going to cut it. The industry is super competitive. FIT offered an abroad program where I get to study abroad for a summer and that was going to help build my resume so when I graduate I can land on a job. ( that was the plan). Now this program was an additional $12,000 for the semester. I said okay ill just use my credit cards. I didn’t even hesitate I paid half of it out of pocket and the rest on the credit card. That same year I was already fed up with my living conditions. I was not happy with the way I was living and since I did have a boyfriend I told him to get an apartment with me. He agreed he didn’t like my living situation so he wanted to “help me”. Now I was the one with the credit so all of the furniture of the apartment guess who put it on their credit card? Another $5,000. ( that didn’t last I got stuck with everything and he just ended up going back to his mothers).
Senior year of college, financial aid hit me with the worst news ever. They told me I no longer qualified for the loans because I “CAPPED” out. I was like what does that even mean. Long story short I had one semester left and if I didn’t put that additional $4,000 on another credit card they were not going to let me take my courses.
MISTAKE #2. At that time I was already in debt so I said F it more debt for me. I told myself “ IDC I just want to finish and I’m going to get a good job once I’m out of here anyways.” That summer of graduation I went CRAZY. I was like after everything I been through I deserve it all. Let me book vacations, let me buy clothes…. Other words “LET ME GO CRAZY AND SWIPE THE CREDIT CARDS; GET IN MORE DEBT BECAUSE I’M ALREADY IN DEBT”
MISTAKE #3 after all the emotional financial mistakes I have already made There I go I did it again. I ended up buying a motorcycle. Everyone thought this is it this “CRAZY GIRL IS GOING TO NOW KILL HERSELF”. Not only was my family surprised hat I got approved FOR ANOTHER LOAN. They became very concerned because I already had debt. They didn’t understand where all this money was coming from . It was FREEEE money to me lol . They weren’t helping me pay for anything so why do they care about how I spend my money right ? ( THE EMOTIONAL SIDE OF ME TALKING) I seriously thought i was NOT going to walk out that dealership with out a bike with out a co signer. I said NO WAY I AM GOING TO GET APPROVED. When the sales man said” YOU ARE APPROVED FOR ANOTHER 5,000 Loan. I signed the papers with my eyes closed because I knew that was more damage. I walked out of there with 0 money down brand new bike not even knowing how to ride one.
That was the emotional side of me talking. I was already in $45,000 student loan debt and didn’t care because I wanted to get my college degree in the field that I was passionate about, my car was another $35,000 that I had left to pay, then by the time I blinked my credit cards were at $20,000, i said fuck it let me buy my motorcycle. ALL TOGETHER I put myself in a debt of $100,000.
Now you are probably like OMG this girl is retarded. NO IM NOT. I just made all WRONG CHOICES. I realized it now about a year later that i was going down the wrong path.
Did I find a decent paying job to pay for everything ? No.
Did I regret buying all that stuff because of emotional temporary stress? Yes
I started to realize that yes I was working and doing everything for a better future but I was not making the best decisions when it came down to money. I was just a mess!!
They say there’s a difference between bad debt and good debt. School debt isn’t bad debt but in my opinion is not bad debt unless you know for sure that you are going to land on a good job. Not only to land on a good job but to land on a job that you actually like. I was chasing my “dream job” forgetting that I am NOT RICH. THERE’S BILLS TO BE PAID. I’m not saying to not go after your dreams. YES GO AFTER YOUR DREAMS AND DON’T GIVE UP! I had to do about 5 internships, over 20 interviews, and it took me about 2 years to actually land a job that I can say I LOVE. I did chase my dreams and I did not give up, but DEBT is no joke. It’s very scary.
You have to try and eliminate debt by staying within your means. I don’t live life with any regrets but I am sharing my story because we all go through it. You can eliminate debt if you make the right choices with money and budgeting yourself. I didn’t believe in budgeting why you think I got into debt? Lol But if you can’t afford that expensive bag don’t buy it! If you can’t afford college, Its simple go to a community college and take regular liberal arts courses and then transfer to your dream school. If you can’t buy that expensive car that you are dreaming about, wait until you make enough money where you are no longer spending your bread and butter money on the car. If you can’t AFFORD IT DON’T BUY IT.
I didn’t know anything about budgeting I only knew about CREDIT. Yes credit is important because without my credit I wouldn’t have purchased my car, I wouldn’t have paid for my education, and I wouldn’t have an apartment. My credit has helped me in so many ways to live. But you have to learn how to live within in your means and make the right choices at the right time.
Now I am very lucky that I was able to work about 2 sometimes 3 jobs to maintain all my expenses but it sure was not fun. It’s exhausting, I did everything in my power to not ruin my credit and not go bankrupt. But trust and believe me IT IS NOT FUN having to work 3 jobs to pay for debt.
Also, you can check your credit yearly by going to http://www.annualcreditreport.com . There you can see what is on your report and if there are any items that you are not familiar with ALWAYS disputed them. Once a year you get FREE COPY of your credit report. You can dispute any information that you know are false and doesn’t show on all three credit reports . Remember it is very important to track your credit. http://www.creditkarma.com is not 100 percent accurate when it comes to your credit score. You can get an estimate on it on on there but it’s not one hundred percent accurate. To get your actual score of your credit contact the credit bureaus they will be able to send you a FREE copy of your ACTUAL score ONCE a year.
I hope my story can help you make the right decisions. You don’t have to learn on your own like I did .