My Citibank card, after I took a hole punch to it.
Yes, you heard me. We received our economic stimulus rebate on Friday and promptly paid off the evil Citibank card. Our balance is zero. Now we just have to cancel the card, which I hope to accomplish today. Since my husband is the primary card holder, he needs to cancel, and it seems like he hasn’t been home to do it for the last couple of days. The important thing is, we’re out of credit card debt forever!
Over the last year, our tenacity has paid off. It’s hard to believe, but it was this week last year that my husband lost his job the first time. We had no idea what the future would hold. We had no idea what we’d do for income. We had no idea what we’d do for health insurance.
What we did know is that we were sick of being in debt, and no roadblock, not even a job loss, was going to stand in the way of getting out of debt. We made a commitment to take on no new debt, and we stuck by it.
We cut costs by canceling things like our Blockbuster and YMCA memberships. We trimmed bills by line drying our clothing, baking from scratch, making our own cleaning products, and planning trips into town to save gas.
We increased our income by taking on odd jobs and blogging. We insured we wouldn’t use our credit cards anymore by first freezing them, and then getting brave and shredding them.
We continued to make steady payments to Citibank, even though our payments weren’t as high as we had initially planned.
Our goal was to pay of the VISA by September of this year, and we hit our goal 4 months early. It’s definitely time to celebrate!
What have we learned from this experience?
- Having a goal is important.
- If you believe in your goal, you can stick to it, even when it seems impossible.
- It’s empowering to meet a goal in the midst of adversity.
Now that we’re out of credit card debt, we need to build up a better emergency fund, and then attack our student loan debt, currently at $6969. Our new goal is to be completely out of debt by January 1, 2010.
Are you serious about getting out of debt? Do you stick to your goals in the face of adversity?
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Congratulations, Lynnae!
WOOHOO!! Doesn’t it feel wonderful!? =0
Canceling your citibank card could really reduce your credit score, especially if you have had it for more than two years. 15% of your FICO credit score is based on “length of credit history.”
Once it’s canceled there is nothing you can due–your score will almost certainly go down substantially, which could result in higher interest rates on new credit accounts. It could even hugely your interest rate on other existing accounts in good standing, if your card issuer has a “universal default” policy.
Tom,
I’m honestly not too worried about my credit score. We have great credit, and we’re not planning on making any major purchases in the near future.
As far as the universal default, I believe that only applies if you’re late on a payment…which isn’t a problem, since I have no credit card debt! :)
Lynnae,
you make a good point. you also say you have “good credit”. There is no more important metric for “good credit” than the FICO credit score. In other words, if your FICO credit score is “low” then in the eyes of banks, credit card companies and lenders, you actually do *not* have good credit, reagardless if what you think.
If you haven’t ordered it recently, then you might be surprised. And please be sure to order your FICO credit scores, not any other scores. The credit bureaus are sellings lots of scores that aren’t used by financial institutions and usually vary substantially from your FICO score.
Hey, I’m stuck now in paying my citi bank bills! I need help. I would appreciate if you could send me an email.
Thanks!
For the love of God.
Citi just got a $300 billion bailout because they couldn’t mangage their business correctly.
And you’re intimidated by some $10 an hour phone rep collections clerk threatening you?
Tell Citibank to go to Hell.
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