Making the same debt mistakes…again

A few days ago I posted that I’m in debt again but I’m not freaking out.  It’s true.  I did have a minor panic attack aka flashback to my previous debt filled life just before I signed the credit application in the store.  But now it’s all good.

Debt free? Not anymore.

After literally giving my blood, sweat and tears to repaying my debt to become debt free I’m once again in debt.  I know in previous posts I’ve vowed never to be in debt ever again, but yet here I am, in debt.  However this time it’s OK, this time I’m not freaking out because this time I’m doing my debt differently.

Last month Nick and I moved to a bigger apartment in a better neighbourhood; we wanted the contents inside our new apartment to match the outside of our new prestigious location.  We decided to take some of our furniture such as our bedroom set but other than that we bought mostly everything else brand new.

This is why I’m in debt…again.

We upgraded our queen bed to a king size and therefore had to buy a new bed frame and head board to match.  We also had to buy a new living room set as well as a dining room table.  Nick and I knew we would have a lot of expenses when we moved so it may not have made sense to get into debt again.  But this time we had a plan; we saved to pay for the movers and other expenses that come with moving and we decided to finance all our new furnishings.

We got into debt the first time because we lived well beyond our means.  We lived in a luxurious fully equipped apartment, we had a car with underground parking as well as brand new electronics.  That was a dumb mistake we couldn’t afford.   I’m sure your thinking “But Kristina isn’t that what you’re doing again here right now?”  Well thanks for asking and yes it is.  But this time it’s different.

This time I know I can get out of my debt and here’s why:

This time we have a plan.  The last time Nick and I got into debt it was because we didn’t know what we were doing with our money.  We kept spending and spending and only making minimum monthly payments.  That’s not a mistake we are going to make twice.  This time we have a plan to get out of debt within six months.  Our furniture came with a payment plan of 24 interest free equal payments over two years, however we’ve set up pre authorized payments to have our debt paid off by May 2015.  That’s my one and only focus over the next six months – to pay off my debt.

We got into debt for a specific purpose.  This time we aren’t just constantly living beyond our means every month and accumulating credit card debt to pay for our lifestyle – a mistake we made last time.   This time we got into debt for a reason, our new furniture.  This time there is a specific start date to the debt and there will be a definitive end date.  At the end we will have a nicely new furnished apartment to show for it, not like last time when all we had to show for our debt was credit card bills .

Our financial situation is different this time.  Last time we got into debt because as recent graduates we didn’t budget or have very high incomes.   This time we have the income to support our lifestyle.  We are in a better financial position this time around and even though being in debt isn’t ideal we still aren’t  matching our expenses flush with our income.  That was a mistake we made in the past and it landed us tens of thousands of dollars in debt.  Even though our expenses are high they are still less than our income and that is a habit that will keep us in the black.

Kristina Tahnyak

Tahnya is a Certified Financial Planner and former Investment Advisor turned marketing and communications professional She holds a degree from Concordia University, is debt free and currently works in the field of digital marketing.