“I am Rebecca Bloomwood, and I am a SHOPAHOLIC.”
I heard it over and over again and it made me cringe. I just watched Confessions of a Shopaholic again and I am terrified by the fact that one day, a Derek Smeath would knock on our door or bust into our office.
I am in a battle. A battle to rebuild a good credit score. A battle I never thought would be so hard, it cost me a lot – time, health and relationships.
I got my first ever credit card in 2011. It was a product of a phone call where a telemarketer offered me a card from a local bank and promised to help me with the financial documents. I have a pretty decent savings account and I thought having a credit card would help me plan and organize my finances further. But to my horror, it did not work out that way.
Month 1 – I received a light, shiny and colorful plastic called Credit Card. It came in a business envelope, enclosed in a letter welcoming me to a world of freedom to buy things on an installment basis. It also came with a flyer which promised a brand new watch when I spend a minimum of Php2,000.00.
So I did. I spent Php2,000.00 on groceries and claimed the brand new watch. My card has been activated on the first purchase and it felt liberating to be able to get something for free for a minimum amount spent. But nothing comes for free.
Month 2 – I received a call from my mobile postpaid provider that I am eligible for a line and phone upgrade. A brand new iPhone just came out and I can be one of the first few ones to have it. And I gave in. I signed a form to upgrade my postpaid plan twice as much as the current and paid extra Php7,000.00 for the brand new iPhone.
Months 3 and 4 – Christmas shopping is never too early if Holiday sales are all around the malls. I still have around 75% credit limit that I can use up to pay the gifts for the season of giving. And oh, there is a promo called “Shop now, pay next year” which enticed me more.
Month 5 – “Shopped then, pay now.” Next year is NOW. I shopped December, next year is January. I was stupid enough to miss that.
Minimum payment required: Php3,000.00
Month 6 – Purchases, finance charges, interest, etc.
Month 7 – Minimum payment required is credit cards’ greatest lie. It is a make-believe figure. It makes you believe that you are not obliged, not until interest and finance charges pile up.
Month 8 – Credit limit is the size of the pit you may choose to dig. The more you believe there is a space left, the bigger and deeper, the hole becomes.
Month 9 – I received a new card that came with my newly-opened savings account. Again, the temptation was hard to resist, a temptation called Balance Transfer.
A balance transfer feature allows you to use a part of your credit limit to be used up to pay for other financial obligations – education, emergencies, credit management, etc.
Again, I missed the point. I gave in to it to pay for my other card’s debts and I failed to manage it properly.
Month 10 – I now have two credit cards and I am sad to admit that my payments are hit and miss. And the finance charges are getting bigger, so are my problems.
I tried to run away from the mess I called debt. I changed my number, I ignored emails, I tried by best to be unreachable but they have my home address.
Debt is like a disease. You Google it. You have the symptoms and you try to cure it or get rid of it. You read about the stories of people who have it. The more you research about it, the more it scares you.
I received notices in brown envelopes, notices with red stamps, notices which threaten to visit me in the office. It was hard, it was embarrassing, but it was humbling.
One day, a Derek Smeath came, to a public official, in the place where I grew up. He was trying to file a case against me and putting pressure on the public official to contact my parents, my relatives, to know my whereabouts. Without exaggeration, I reached that horrifying part. It was an eye-opener for me and it pulled be back to the ground so I can stop running from it.
I wanted to give Derek Smeath a hard time. I wanted to make sure that the hassle and inconvenience he brought me will get back to him. I know he was just doing his job and I do not wish to justify my acts but there are better ways to settle the issue in due time without tainting someone’s credibility. I think I have already lost that financially, but at least give me a chance to recover by not pushing me down the pit further.
I went to the bank the next day to explore my payment options and that did not include paying through Derek Smeath’s Credit Collection Agency. After several exchanges of emails during that week, I signed a 12-month installment to pay off my debt.
I am still into it – paying off. I am struggling but with every monthly installment that is being paid, I can breathe deeper. I am slowly recovering and controlling my urge to shop and use credit card number 2 which has a better reputation and that, I don’t want to lose.
It might take a while before I regain a better credit score but in this journey, I learned a lot. The best part probably is, I was able to confirm that debt is a disease. It spreads in your system but it is not impossible to control. And the first step to control it, is to accept that you have it.
Update: As on June 30, 2016, I have fully settled those restructured payments and officially received a bank certification for it. I’ve done it – with focus and discipline on what really matters. Think LONG TERM. Good luck!