Becoming Debt Free – Closing out our Credit Cards

I want to tell you all about the process it took for me to close out my credit cards.

But first, a little bit of a background.

Back in 2011 or so, our church in New York did a series using Financial Peace and handed out books for The Total Money Makeover by Dave Ramsey.

This seemed all good and fun, but I didn’t quite bite on as I probably should have.

Fast forward to November / December of 2013.

Our son is around 7 months old, and the car I was driving was starting to act up. Nothing major, but enough to be like “I want something else…”. So I went out and bought a nice car. A 2013 Subaru Impreza WRX STI Sedan to be exact.

I loved this car. A buddy of mine had a 2005 back in the day, which inspired me to get this one.

Well, I bought hook line and sinker into many of the dealership upgrades.

  • You want it for less than $500 a month? We can’t do that. Here you go, take it or leave it…
    • And boy did I take it…
  • If you buy this $3,000 gold package, we can get you a better rate AND it actually lowers your payments
    • I had never needed to use the Gold package (don’t really remember what it does, to be honest… I think I have the paperwork still around here somewhere).
  • You should also get this maintenance package that you prepay for, and get the best deal for oil and services.
    • I had only used the maintenance package once. The dealership is about 40-45 minutes away (not including traffic), and was a pain to get scheduled / serviced quickly. So I ended up just buying my own Subaru branded filters and oil and did it myself.

Well, I can afford this car. Scratch that… I can “afford” the payments. As Uncle Dave says: “Rich people say ‘How much?’, broke people say ‘What’s the payment?'”. I was acting like a broke person.

But anyway, back to the story.

February comes around, and we join a Financial Peace University class in our neighborhood.

What does Uncle Dave say about these cars? A lot. But the main takeaway that I got was to sell the car.

Well crap.

I wanted to sell my car, but there were other things I needed to get rid of as well.

I then spent the next year working on a property I had in Wyoming. Every weekend, for 48 hours I was working on my house. Repairs, replacements, maintenance, painting, cleaning, etc. It took quite a toll on everything: The budget, the family, my body.

But eventually it was sold for a profit, and I was able to pay off some debts.

Didn’t cancel / close those lines of credit at that point, and we also chose to spend on some not-so-necessary items (new couch, new phones, new laptop, new water softener system).

Whoops. Shoulda knew better from FPU, but I choose the path of out earning my stupidity over a year later.

Fast forward to about 4 months ago.

I closed 4 credit cards, totaling around $31,000 of open credit. These have been paid off for quite some time, I just never seemed to pull the trigger on finalizing the closure.

During this process, my anxiety was high.

  • What are they gonna say?
  • What if they convince me to keep it open?
  • What if, what if, what if?

Here’s how it usually went down.

  1. Call
  2. Key in your account number
  3. Listen for the menu for a representative
  4. Wait a couple of minutes
  5. Verify more info with representative
  6. Ask to close the account
  7. Get transferred
  8. Verify same info again
  9. Confirm you want to close the account
  10. “Thank you for your business Mr Hatch, have a wonderful rest of your day”

THAT WAS IT!

One of the cards actually allowed me to cancel it WITHOUT speaking with a representative. Just a verbal “Yes” on confirmation.

But, to my surprise, the sky did not part. The sun did not shine down on me in a beam of awe and wonder.

Instead, I was filled with relief. Not because the cards are closed, but because it’s over, and I don’t have to be anxious about doing it anymore.

And after they are closed, you start to think differently about solving problems.

In an upcoming post, I’ll talk about my adventures with the IRS, my laptop that got fried, as well as medical bills and insurance claims.

RJ

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