Hitting Rock Bottom and Getting Back Up Again

This post may contain affiliate links which help me keep the site running. All opinions and recommendations are 100% mine. I never recommend something I haven't tried and used myself.


It was 2001 and I was a senior in college when I hit rock bottom financially. I was waitressing full-time, living alone in an off-campus apartment, carrying a car payment, $6000 in credit card debt and nothing to show for it but some Tommy Hilfiger clothes (he was big back in my day, I swear), a pager (I can practically hear you laughing at me!) and a pantry full of ramen noodles. I was adulting—hard, and at first I had been successful at it, but the more I lived my life on credit, the more I realized I was failing. I was drowning fast and I looked high and low for a life raft.

Now $6000 might not sound like a lot of money or a deep hole of debt to you. But you have to put things in perspective and realize that I was a full-time student and waitress bringing home $1000 a month if I was lucky. Though actually very reasonable, my rent and car payment still took up almost half of my income. Paying off that debt seemed insurmountable to me.

I remember the night I pulled out the yellow pages (internet was still new and a luxury I didn’t have) and called a credit counselor for help consolidating my debt. I had no idea what I was doing, but I was desperate. The gentleman on the other end of the line was kind and compassionate, but his words hit me like a brick, “I’m sorry dear. You simply don’t make enough money for us to help you get on a payment plan out of this debt.” I was stunned as I hung up the phone in disbelief. I mean, I know I don’t make enough money, that’s how I got into debt in the first place, right?

Well, no. If we’re being honest, I got into this mess not because I didn’t make enough, but because I spent too much. It was sobering to realize that the only way out of my hole was to dig my heels in and climb out myself. No one was going to reach their hand down in and pull me to safety. There was no guide or road map; I was going to have to figure this out on my own.

I didn’t know anything about trying to call the creditors to ask for a lower interest rate to make payments more manageable. I couldn’t get approved for another credit card with a high enough limit at 0% APR to make a balance transfer a viable option. So, I marched myself down to my local credit union and applied for a fixed-rate, unsecured loan to pay everything off.

Even though it had been difficult to do, I had managed to always pay my bills on time. I couldn’t pay my credit card balances in full, but I had always made sure to at least make the minimum payment by the due date. Doing so allowed me to maintain my credit score. If you are struggling with your debt, one of the most important things you can do is stay current with minimum payments while you formulate a plan.

I was able to get approved for the loan, with one caveat—I needed a cosigner. Cue the phone call to daddy—turns out I did have someone to lend me a hand on that last step out of the hole! He helped me get a loan so I could pay off all the debt. I cut up and closed all the cards but one as soon as the funds were available to pay off all of the balances.

I promised myself it would never get to that point again. I budgeted diligently and charged responsibly only what I knew I needed and could pay off at the end of every month. Even though the interest rate was higher on the personal loan, I put any extra money I had towards my car loan principal because the balance was lower. That way, I could knock out that payment and free up additional funds as fast as possible to continue paying down the personal loan. This is what Dave Ramsey calls the snowball debt repayment method.

I avoided shopping (sorry Tommy Hilfiger), cancelled the pager, and passed up evenings out with friends in favor of a second shift at the restaurant. I stopped adding what-I-thought-were-cool-at-the-time accessories on my car—I mean did it really need a bra (two words–um, ew?!), window and sun roof deflectors, and a giant decal on the windshield that said Thunderbird (I knew what I was driving after all, why announce it so obnoxiously)?!

When I did spend time with my friends, I did so at backyard parties or bonfires instead of night clubs with a cover charge and pricey drinks. I brought my lunch or dinner with me to work instead of eating off the menu. Even with meals discounted 50%, it was still cheaper to pack food from home. Eventually, after my lease was up, I gave up living alone to reduce my rent and utility costs.

Was all of this fun? No, but you know what else it was—temporary. This too shall pass became my mantra. I made the necessary short-term sacrifices that were needed to better myself in the long-term. If you’re feeling like you’re stuck in a cycle of crushing debt and insufficient income, you have to take a hard look at what you’re willing to give up in order to get ahead.

Is it time to take on a second or third job or can you get away with just making cuts to the food budget, entertainment, or cell phone plan?

Maybe you need to do something else unpleasant…like tell your kids no. No to a new iPhone, to buying lunch every day at school, to the brand name clothes, to the pricey sports leagues, to the expensive summer camps, and on and on.

Or might it be necessary for you to take drastic measures and downsize your home or sell your car with the high-priced payment so you can buy something used and affordable?

Going into debt is easy and getting out is hard. That’s a simple fact. But the sooner you start, the closer the finish line. I’m better now for the struggles I went through then. I may have been young and fortunate to learn my lessons before it impacted anyone else but myself. But regardless of where you are when you get that financial reality check, the important thing is that you get it, and start taking action before it gets worse.


Were you wise enough to avoid a financial meltdown in your past or do you have a similar story to tell? I would love to hear how you got back on track in the comments!

About The Author

Amy Davis

This post may contain affiliate links which help me keep the site running. All opinions and recommendations are 100% mine. I never recommend something I haven't tried and used myself.

I’m a former therapist turned stay-at-home mom sharing my tips and strategies to achieving freedom from debt. When I’m not blogging, cooking, cleaning or otherwise catering to the needs of my 4 little persons, you’ll find me binge watching Billions. #goals

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