Happy Belated New Year folks!
It is a blessing to be alive and in good health. So much has happened since the last post, so as promised here’s a personal account about credit.
This story starts on a relaxing August evening while visiting my wife’s parents for dinner in 2011. While everyone conversed and gave thanks for the meal being served, my mind raced with questions. What if I lose my job? Will my marriage end in divorce? Is it even possible to pay off $85,308.07? These thoughts were in stark contrast to my outlook on life in December 2010: I was a recent college graduate, landed a great job, and was soaring with feelings of invincibility. After a few short months unfortunately, 2011 arrived with my impending financial doom. As I sat at the table that night, I felt like the chicken on my plate…DONE.
The warning signs were there four months prior, as I noticed my credit score would fluctuate by as much as 25 points. I created a credit monitoring account and set up text message alerts through Experian. I investigated reasons behind the score changes on Experian’s website, and read that score fluctuation was a normal occurrence, so there was no need for alarm. I dismissed my concern and figured everything was okay, forgoing any further investigation.
Experian is one of the major credit report bureaus, along with TransUnion and Equifax. These guys monitor and report credit scores used to determine your ability to pay back debt. Typically scores range from 300-850. Your chances of being approved to make big purchases on credit (like houses and cars, for example) improve with higher scores. The higher your credit score, the lower the perceived risk for the lender. The lower the credit score, the less likely you are to be trusted with a loan, as you are perceived to be more likely to default on your end of the deal.
After a couple of months of occasional text alerts gradually becoming more frequent, I started to feel something was actually wrong. I ran over to the nearest computer and logged into Experian’s website. In bold red letters read, “Payment 30 days Late”. In shock, I realized that it was a student loan company owed. In angst I thought, “I’m already paying over $900 a month, and now they want more?! This has to be a mistake!” Sadly, it was an oversight on my part, and not an error as I so hoped.
From this experience I’ve learned:
1. Never assume everything is okay.
I ignored the many warnings that I had not kept current with all my student loan accounts. After discovering the additional obligation, I had to fork up another $90 a month. For the next seven years I have a late payment attached to my credit report, which lowered my credit score. Sometimes making that extra call or sending another email can properly inform us of what’s really going on.
2. Keep Calm. Don’t panic.
I worried about insolvency and divorce as a result. Well, I’ve lost jobs and every time the Lord has provided. My wife is still by my side, and we will celebrate 5 years of marriage next month. The sleepless nights have all proven futile as they did not improve my ability to keep jobs. Nor did stressing about the future make me a better person; ask my wife, it made me grumpy at times.
3. Goals take time to be reached.
Earning degrees don’t happen overnight, neither will paying back the student loan balance. Education taught me to plan and break monstrous goals into smaller tasks. Graduating from college took focus through each class and each semester before realizing the dream of walking across the stage. Now the year is 2016, my goal is to one day be debt-free. I can smile knowing that 85k is not my loan balance anymore.
4. Enjoy life.
We all have places to go and things to achieve. We stop living once we lose hope and have nothing left to live for. 2011 marked a time for me where I didn’t enjoy watching movies, practicing guitar, or playing video games. Taking breaks to discover and engage in hobbies helps relieve stress. So while it is important to work hard, be sure to never forget how to play hard.
That’s all I have for my credit experience. Thanks for stopping by, the next blog post will be entitled “Murphy’s Law”. See ya!