When I was young, I never gave my financial health much thought. I started to accumulate debt my freshman year of college. Not only did I take out student loans to finance my education, I also got my first credit cards. Although tuition and housing were covered by my student loans, I used the credit cards for “fun” things like buying new clothes or going out with friends. I developed a “live it up now, worry about it later” mentality, staying afloat by making just the minimum payments. I viewed my credit card limits as an asset rather than a liability. That way of thinking remained with me through undergrad and law school. Sure, I was book smart but clueless when it came to finances and money management.
When I graduated law school with six figures of debt, I wasn’t even worried because I just knew I was going to be a hotshot entertainment attorney and pay it off in no time. Was I naïve? Maybe. Optimistic? Sure. A dangerous combination of both really. I was lucky enough to get my foot in the door in the music industry and worked for some of the biggest record companies in the world but never earned enough money to cover my living expenses and pay back my debt. After struggling for years to keep up with my student loan and credit card payments and facing some health challenges, I decided to file for bankruptcy.
It was one of the best decisions I ever made. My only regret is not doing it sooner. For so long I struggled with my debt, all the while keeping up the façade that I had it together. I was dodging calls from creditors, throwing away bills without even opening them because I was so overwhelmed. I was drowning. I contemplated bankruptcy for months but didn’t take action because I thought it would make me a failure. I felt stuck, powerless. I remained in that dark place for a long time before I built up the courage to use that lifeline.
My situation was so dire that I could not even afford to hire an attorney. I had to roll up my sleeves and teach myself bankruptcy law so I could represent myself. In my research, I came across the “undue hardship” exception that allows student loan borrowers to discharge student loan debts in bankruptcy if they meet certain criteria. I decided to give it a go and after all was said and done, I wiped out all of my consumer debt and $120,000 of student loan debt in my bankruptcy. I had accomplished what seasoned attorneys told me was impossible.
The beauty of my bankruptcy is that, not only did I defy impossible, I changed my life and learned to live within my means. I haven’t incurred any new debts since. I changed my mindset around spending and debt. When I want something, whether it’s a new dress, concert tickets or a dream vacation, I pay for it with money I have instead of borrowed money. The experience taught me self-reliance and showed me how powerful I really am. I now have the freedom and peace of mind to live a life of passion and purpose. That’s what financial health means to me.