Rachel Kramer Bussel* thought she was on track to be debt-free this year, but the COVID-19 crisis has shown her just how much money she’s been wasting.
At the beginning of 2020, I was completely focused on getting debt-free by the end of the year.
I took on extra assignments and sent the money I received to pay off my debt, gleefully tracking each payment.
By early March, when I was set to throw even more toward my debt, my financial reality changed abruptly.
All of a sudden, articles that I’d spent many hours researching and writing were on hold — along with my payments.
My seemingly steady gigs were in jeopardy.
My biggest source of income, book royalties, could drop precipitously.
I won’t know if that’s the case until nine months or a year from now.
So, I shifted course, realising my most pressing financial issue is paying rent so I can stay in the apartment I’ve shared with my boyfriend for the last four years.
To that end, I immediately made major changes to how I spend money.
I cut way back on my spending
I cancelled upcoming trips, even ones over six months away; the only trips I’m still hoping to take are two family weddings, though I’m prepared to pull out if I can’t afford them.
I cancelled my online therapy, because I know that the stress of spending money I shouldn’t will outweigh whatever positive mental health benefits I’d be getting.
Some of the smallest ongoing purchases I cancelled hurt the most, like backing friends on Patreon, which I plan to resume once my finances are more stable.
Other expenses that seemed important before I’d ever heard of COVID-19, like manicures and highlights, no longer matter to me.
When I look back over how I spent money in January and February, I realise that even though I told myself I was committed to becoming debt-free, that wasn’t entirely accurate.
I still wasted money I shouldn’t have, like getting a hotel room when my housing fell through at the last minute, rather than staying with a friend.
When my boyfriend and I were feeling lazy, we’d order takeout, not caring if it cost $30 or $60.
I’m embarrassed to say that, during a work trip, I bought three dresses from a local store, plus jewellery, that I in no way needed — I just wanted them and thought I could seek out extra work to cover the purchase.
Some money I’m glad to have used to help others, like donating to political candidates or a friend’s fundraiser, and look forward to doing so again in the future.
I’m more focused than ever on getting out of debt
It’s only in retrospect that I see that I was counting on my income remaining the same to juggle all my future bills.
Without that safety net, I’m just hoping that enough work continues to come in to not send me further into debt if I have to take cash advances from my credit cards.
The only aspect of my financial situation I can control is how I spend the money I do have, something I have to keep reminding myself of.
One small silver lining is that I’ve become grateful in a new way for the money my boyfriend and I have spent in the past to make our home a pretty one, from plants to art to furniture, especially since we’re spending all of our time here, and will continue to do so even after our State is out of lockdown to keep saving.
I have more time now to appreciate those purchases and do my best to show my gratitude by saying hello to our plants (they have names) as I open the curtain to give them light each morning.
So many of the things I used to spend money on feel useless in this new, at-home-24/7 life, but I’ve also come to savour them, rather than berate myself for having purchased them.
We’ve been having fun experimenting with new recipes with the foods we’re digging out of the back of the pantry, like a random can of octopus a relative brought back from a trip.
At that clothing store on my trip, I bought four small stackable rings.
I’m wearing them now, and even though I know they were a frivolous purchase, they’re bringing me joy, which I hope will help carry me through the rest of the year.
I plan to stick to my new budget
The biggest challenge will be when life returns somewhat to normal (assuming it does), to not fall back into my old ways of thinking that if I’m not spending lavishly, I’m being frugal.
Simply going through my credit card statement for this year taught me that’s not the case.
I’ve now started an emergency fund, with a goal of building it to six months of expenses, something I’ve avoided previously because I thought paying off my debt, including interest, was more urgent.
This has been a wake-up call that even though my debt felt crushing, it can wait if it needs to.
Paying rent and buying groceries can’t.
Only when I have my emergency fund in place will I return to paying off my debt beyond the minimum, and only when that’s done will I think about travelling recreationally.
That’s the order I should have been following all along, but it took a worldwide emergency to make me truly understand that.
* Rachel Kramer Bussel is a freelance writer. She tweets at @raquelita. Her website is rachelkramerbussel.com.
This article first appeared at www.businessinsider.com.au.
