He started the blog, Debt Sucks, in 2007 to hold himself publicly accountable for paying back his debt. Despite his efforts to live on his own and to stop accumulating more debt, however, Jake found himself barely scraping enough money together to feed himself. He was only able to make the minimum payments on his nearly $65,000 of debt.
By the age
of 23, Jake had racked up $40,000 in student loans in just three semesters at a
state college and owed another $24, 576 on top of that. Like many other people
his age, he had spent thousands of dollars without really knowing how he would
pay it back. It took some pretty desperate-feeling times before he fully
committed himself to paying back the money he owed and to starting over.
“It really took hitting rock bottom for me to get off my ass and do something about my debt - I was unemployed, couldn't pay my rent, feeding myself with my change jar, and had accepted the fact that I would soon be living out of my truck,” Jake explains. “About 2 weeks before that became a reality, my mom showed up unexpectedly at my apartment because I wouldn't return her phone calls, took me grocery shopping, and told me that I was moving in with her dad. Other than motherly love, part of that was that she was a co-signer on several of the loans I wasn't paying. I was glad to be eating something other than PB&J for the last few months, finally accepted the offer of a place to live with no rent, utilities, or even grocery bills, and recognized the opportunity to never get myself into that situation again by taking advantage of my drastically reduced expenses to tackle my debt.”
In 2009, Jake set a goal for himself and made getting out of debt his top priority. He’s working to be debt free by May 2014 and regularly writes about his budget successes and failures on his blog.
What I think is most inspiring about Debt Sucks, as it’s so aptly named, is that Jake writes openly and honestly about his personal finance mistakes. To me, his transparency is as good a guarantee as any that Jake has turned over a new leaf, said goodbye to unnecessary spending, and isn’t ever going back to how he lived and spent before.
“Before, I was living paycheck to paycheck, yet still managing to buy things that I didn't need - things like a 75 gallon aquarium (that I left at my last apartment) and plenty of games for my XBox 360,” Jake says. “Now, not only do I have a budget, but I more or less stick to it, and by breaking it down into a daily budget, I think before I spend. I am no longer accumulating stuff (not nearly so much, anyway), and while I'm not living the high life anymore, and have less luxuries, I still feel a lot better.”
In addition to moving in with his grandfather so that he could funnel the vast majority of his earnings, as an order picker in a heating and plumbing supply warehouse, toward his debt, Jake says one of the changes he made that has allowed him to save a lot more money each month was getting rid of his truck and opting for a $10-in-gas-a-month, low-cost insurance scooter that he uses to get from point A to point B.
Like any big change, the transition from spending lavishly and without second thought to frugal living and saving doesn’t come without challenges--at least not initially. Jake has certainly had some challenges but he’s identified the things that have made his debt repayment goals difficult and is working to overcome them.
“The hardest part has been not letting my spending increase as my income increases,” Jake says. “I'm currently ever so slightly behind on my five year goal, but since I can easily quantify that, I'm steadily catching up.”
The thing that makes Jake’s efforts to repay his debt even more impressive is that he’s in his early 20’s. He learned some valuable lessons early on; essentially that no debt is good and why put off what you could do, or rather start, today. Unfortunately, Jake says he doesn’t think his epiphany with regards to debt is a trend that’s catching on with other people his age.
“I don't think people my age are so much surprised about my debt adventures as they are apathetic,” he says. “They think it's fine and swell that I'm doing what I'm doing, but I'm not exactly inspiring them to do the same.”
It’s becoming more and more apparent that when people first leave home, to go to college or to work, many of them don’t know the first thing about money management and, like Jake, student loans and credit cards seem a great way to pay for anything and everything they want to have and do, at the time. Perhaps the belief is that there’s still plenty of time to pay back the money that’s owed, or maybe the ‘fend for yourself’ part of leaving the nest has not yet sunk in.
I asked Jake what advice he would give, based on his own experiences, to young people who are about to leave home for the first time. Jake says, if he could do it over, he would avoid borrowing at all costs, get a part time job while he was in school, and never get a credit card.
“I knew all the tricks and I never fell for filling out an application for a free Frisbee or anything, but I figured I would get one (a credit card) on my own just for the sake of building a little credit of my own. Big mistake,” he says. “The credit card company just kept raising my limit, and I kept on hitting it. My circumstances in life drastically and unexpectedly changed for the worse, and I found comfort in buying myself things, rather than worrying about saving up for an apartment of my own (which became a necessity at the time) and strained my relationship with one of my sisters while I kept living with her rent-free and kept on buying things. All because of that little card.”
It’s amazing to think that the man behind Debt Sucks is the same person who, not even a decade ago, was racking up debt like it was going out of style. There are no longer any delusions that he ‘deserves’ to buy stuff on borrowed money or that he’ll never have to pay it back. His posts are largely detailed updates about where he’s at with his debt repayment goal and what he’s doing to make it a reality.
Jake says he hopes his blog continues to be a means through which he motivates himself to keep working toward his goal, but he also hopes that it inspire others to see that it’s never too late to start getting out of debt and that anyone, with a little perseverance, can do it.
“…I also really hope to be able to show that even making $10/hr, it is possible to get out from under a huge mountain of debt, if you do what you have to do to get it done,” Jake says. “I feel like I'm pulling for the ‘regular Joe’ out there, and I'm planning on doing a series of posts sometime in the near future outlining just how a guy making $10/hr could make so much progress on his debt in such a short amount of time.”
These days, it’s not very often that we see someone own up to their debt in as public a way as Jake has. Admitting that you made some personal finance blunders, that you spent irresponsibly or that you got in over your head is hard. Few have the guts to do it.
Heck, it’s not just individuals whose pride gets in the way of taking responsibility for their actions. Just look at the corporations and banks that have been bailed out yet still pretend that it’s business as usual. Maybe if they had publicly owned up to their financial mistakes, like Jake did, they would be tightening their belts in every way possible and taking the necessary measures to make sure such a debt catastrophe never happens again.
Debt sucks, so stop pretending it doesn’t and realize that you have to do something about it.
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