This is the third installment of our series Into the Black, where we hear from people who found ways to pay off serious debt. First up was Page Trimble from North Carolina, who paid back $68,000 in three years. Second was Kelsey Kronmiller, who’s cut her six-figure debt down by $50,000. This week we talked to Rob Paschal, whose debt management has improved his mental and physical health.
Rob Paschal, 43, Cedar Park, Texas
Past debt: $6,000 as of spring 2015
Source: Credit card debt due to signing up for a shady dating service
Job: Project manager at Oracle, specializing in retail technology
Salary: More than $100,000
Current debt: $4,000
I got divorced four years ago and signed up for Texas-Singles.com, this really expensive dating service with a nice office in north Austin. I went in and this woman told me how they had all these desirable women in the service and how they’d personally select dates for me. My attitude was, Well, it’s expensive because it’s good. But it turned out to be horrible — their “hand-picked” matches were made by an algorithm and the dates I matched with were underwhelming. The word “scam” comes to mind, but I fell for it because I was desperate to meet women. After throwing a few grand at this dating agency, I walked away from it. It was embarrassing, but I had to let it go.
I also had some major car repairs done to my 10-year-old BMW, and when things go wrong on that, it’s an arm and a leg. Next thing you know, I had gone from multiple months ahead on my expenses to living paycheck-to-paycheck and carrying a $6,000 balance on a high interest (20 percent) credit card.
So a little less than a year ago, I set out to start paying down my debt slowly. Instead of overhauling my lifestyle, I thought about several little things I could change in my life. I’d had buddies who wound up in $30,000 in debt and had to completely redo their lives. But I was a single guy in Austin. I wanted to be able to go out and see a band when they came to town, have some good brisket, take a woman out to a nice meal. I didn’t want to be a hermit at 43 years old.
Changing your life doesn’t have to be something drastic like selling your car — it’s deciding to bring your lunch to work each day and not going to as many happy hours. I stopped taking the toll road to and from work, for instance. And those little things added up: I’ve already paid down $2,000 of my debt, and should have the rest paid off in a few years (if not earlier).
The smartest thing I did was transfer my credit card debt to a low-interest loan. Interest was a new concept to me — I had never paid attention to it because I always just paid off my credit card each month. When I realized I was paying 20 percent interest on my credit card, I decided to join a credit union. I took out a $5,000 loan at 5 percent interest. I used that loan to help pay off the credit card debt, and now I pay down the loan instead.
I finally cut the cord on my cable package, and that was huge because I had all the premium channels (HBO, Showtime, etc.). Instead of $200 per month cable bill, I have Hulu and Netflix, and that’s all I need. And it made me healthier. I wasn’t spending hours on my ass, flipping through 2,000 channels. It was just like in Fight Club: “By the end of the first month, I didn’t miss TV.”
Spending $15 on lunch, five days a week, adds up quick. So I started bringing my lunch to work each day, and cooking for myself at night. Why would I spend $15 on dinner when I can grab a couple chicken breasts and sauté some fresh vegetables? I went from eating out for lunch every day to about three times a week. Going out for dinner used to be three to four times a week; now, it’s once.
I kept my gym membership, though, because it was important to me. But I told myself, If you keep this, you have to actually use it. My workout routine was so erratic before then. I’d get gung-ho about working out for a week, then start to make excuses. But this time I was committed. I found a powerlifting program I liked called Starting Strength, and started going to the gym three, four times a week.
It took about a month to get used to the new habit, but now I feel amazing. I have muscles in my legs I never had before. When I started the program, I couldn’t even spot the naked bar (about 45 pounds). Now I squat 225.
And success breeds success. I stopped wanting to go out and eat a burger and fries after putting all that work in the gym.
Next thing you know, I’m feeling a lot better. I’ve had depression for 30 years. The endorphin rush of the gym really helps with that, and so does being happy with what I see in the mirror. I’m 6-foot-4, so I’ve always had to wear XXL shirts, just so they reach my waist and I can tuck them in. But they always hung on my shoulders wrong because I wasn’t bigger. Now they fit.
Eating out less, cooking more, going to the gym, saving — they were all interwoven.
John is a staff writer at MEL, where he last wrote about why people who “stonewall” during arguments tend to develop neck pain later in life.
More personal finance on MEL:
- Into the Black: How I Cut My $118,000 Student Loan Debt in Half
- Into the Black: How I Paid Off $68,000 in Debt in Three Years
- Will $75,000 a Year Make You Happy? Is 30 Percent of Income the Max to Pay in Rent?