I am very honored to share my next story about overcoming depression in order to regain control of your finances. I typically do huge debt pay off stories about how they paid off large amounts in a short period of time.
This story isn’t about the amount or the time it took really. It’s about overcoming the triggers that is causing your debt and out of control spending. It’s a very important aspect in your financial journey because it’s really dealing with the triggers that got you in the mess in the first place and what is keeping you there.
Once you can realize why you are spending, then you can treat the problem instead of just the symptoms.
Depression is a very real problem and it can easily manifest itself into a major debt problem. It is so easy to ignore the depression and just spend as a way to feel happy. The problem is that the happiness from shopping doesn’t last very long. It wears off very quickly and then you need to shop again to fill that void.
This story is about how Jon realized his depression was causing his spending and how he was able to it and pay off all his debt.
Brief history, background information, marital status, children?, age, highest grade completed, if went to school what did you major in? Do you use your degree, income range if comfortable sharing.
My name is Jon Dulin and I am 39 years old. I am currently married with 2 daughters. I got myself into credit card debt after graduating college in 2001.
At the time, the economy had just entered into a recession. I was a newly minted college grad with stars in my eyes. I was expecting endless job offers of six figures and living an incredible life.
But when the job offers didn’t come, I slowly became depressed. I used spending money as an outlet to bring me happiness in the short term. What I didn’t realize was the pain it was adding to my life both now and in the future.
As the “highs” of spending money quickly wore off, I had to buy more things. Sadly the “high” kept wearing off faster and faster, resulting in me digging myself into debt quicker by the day.
How much debt did you have? How quickly did you pay it off? If you are still paying it off, how much have you paid so far? When should you be debt-free?
In total I had over $10,000 worth of debt. It took me a little over 1 year to pay it off completely once I had a strategy that worked.
Including my failed attempts at paying off my debt, it took me closer to 3 years.
What did you do to pay it off? Did you sell anything, work extra jobs, cut expenses, give up anything (Starbucks, luxuries), cut expenses. ect?
I worked 2 jobs. First I was able to land a part time job and I put what I could towards my debt. This was mostly just the minimum payment each month.
Eventually I was able to find a full time job. I decided to keep my part time job and put 100% of my earnings from it to help pay off my debt. Then I took a percent of my income from my full time job to put more money towards paying off my debt.
What are your current financial goals? And why
My current financial goal is to retire early, with the goal by 55. I’ve learned what I value in life and buying things isn’t one of them. I get more pleasure and happiness by spending time with friends and family and doing the things I love to do, like playing golf and wood working.
What was your “aha” moment that caused you to change your financial ways?
My “aha” moment came when I was out shopping. I was in a clothing store ready to buy a jacket. For some reason, the light bulb went off and I asked myself why I was buying a jacket. I had a handful at home already and I didn’t even wear most of them.
I put the jacket back and started to drive home. On that drive I started to question my life and why I was buying so much stuff.
This led me to realize (or admit to myself) that I was depressed. I ended up getting professional help to overcome my depression and at the same time started to pay down my debt.
Did you struggle to pay off your debt?
Yes. Before I admitted my depression, I thought I just liked to spend money and had a spending problem. So I thought I could just choose to stop spending money.
My first attempt was to open a second credit card to take advantage of a 0% balance transfer offer. My thinking was I would save money on interest as I paid off my debt.
This worked great for a few months, but then I started spending on the original card again.
Thinking I was smarter than I was, I ended up opening another credit card to take advantage of another 0% balance transfer. I moved my “new” debt to this card. Sadly the cycle repeated itself.
And I am sure it would have kept repeating if I had not gotten real with myself about the true reason I was in debt.
Do you do a monthly budget? Any tips for sticking to it?
I used to follow a strict budget. At first I used a spreadsheet to track my spending. Then I switched over to an app, but I found I liked the control and customization of spreadsheets more.
Now though I don’t actively keep a budget. Instead I make sure I save first every month. This includes putting money into retirement plans, other investment accounts, and savings accounts.
I then spend whatever is left over. This only works because I know what I value and as a result, don’t go on spending sprees or binge shopping trips. Very rarely do I get a credit card bill in the mail now that surprises me.
Were you afraid to use credit cards after you paid off your debt?
For almost a year after paying off my debt, I swore off credit cards. The scars of my debt were real and I was afraid if I used them, I would end up in debt again.
But with time some of the fear subsided and I slowly began using credit cards again. Fast forward to today and they are my main spending tool.
With that said, this would not be the case if I didn’t take the time to understand what I valued. By knowing what brings me joy makes it easier to not overspend.
Have you done anything others would think is extreme to reach your financial goals?
During my first attempt at paying off my debt I cut out all entertainment spending from my budget. After I paid my necessary living expenses, everything I was earning went towards my debt. This included me not going out with friends.
Things worked great for a couple months, but then I began to resent my debt. I had to adjust my budget to allow myself to enjoy life now while still making paying off debt a priority.
Looking back, I just wanted to get out of debt as fast as possible. But I had to realize that I didn’t get into debt overnight and I wasn’t going to get out of debt overnight either.
Do you read nonfiction books regularly? What are your favorites?
In my limited time with 2 young daughters I don’t read as much as I used to. But I have 2 favorites that I read over and over again.
The Magic Of Thinking Big by David Schwartz and The Compound Effect by Darren Hardy. The first one reminds me to stay positive and look at the big picture. Too many times we get caught up in negative talk or thinking and this can lead to unhappiness. By finding the good in every situation, I am happier and healthier.
The second book, The Compound Effect, looks at how small things every day add up to big change over time. I think I like it because it is like compound interest for your life. You might only earn a few pennies in interest a day, but over your lifetime, they add up.
The best example in the book is weight related. The author talks about how eating just an extra handful of some bad food every day doesn’t seem like much. After all, it is only a couple hundred calories.
But over the course of 10 years, you gain 15-20 pounds all thanks to that little handful every day.
How do you stay motivated?
I stay motivated by tracking my net worth. I calculate it every month.
For some this might be overkill, but it motivates me to keep saving money every month and question my spending.
If you could go back in time, what would you tell yourself?
I would tell myself that things don’t equal happiness. I thought buying more and more stuff was making me happy when in reality it wasn’t.
It was just an illusion of happiness. And when I look back now, I can tell you that the best moments in my life when going through my struggle were the times I spent with my friends and family.
Sadly I see this play out with others today. They buy things thinking that this stuff will make them happy, but it really doesn’t.
What advice would you give someone in your situation? Or someone thinking about being debt-free but hasn’t started or don’t think they can do it.
If you think you have a spending problem, I would encourage you to take some quiet time and dig deep within. Many times our overspending is a symptom of some greater issue. But because we don’t want to look within and admit our flaws, we blame poor money habits.
This results in us going through the debt cycle of paying down (or paying off) debt only to be swimming in debt a short time later. You have to get to the root issue and address it.
I’ll be the first to admit it isn’t easy and it isn’t fun. But I am glad I did it. The short term pain was well worth the happiness I experience every single day since.
Jon Dulin is a personal finance writer at Compounding Pennies. His site teaches readers how to improve their finances day by day to experience life changing results. You can follow Jon on Facebook, Twitter, or Pinterest.
Final Thoughts from Ashley
If you are or someone you love is dealing with depression, please urge them to seek help. Depression is not something that you can typically deal with on your own. It is a chemical imbalance in your brain and you need professional help to deal with it.
I want you to think about what things in your life could be triggering your spending habits. It may not be depression but it could be some other trigger or void you are trying to fill. Think about some other ways to cope and fill that void instead of spending money. It could be journaling, time out with friends, going for walks, whatever it is, find what works for you.