"This is getting out of control. The debt cycle becomes a death spiral. My whole life is a mess"

The problem is that debt becomes a way of life. You take out a student loan to get a degree. Well, that makes sense — it gives you a lifetime ability to earn a living. You finance a car. A car is not a luxury. You need a car. You buy a house and you need a mortgage. Everyone knows a mortgage is good debt. You have more kids and now you need a van, so you finance another car. Do you think I could save $15,000? You pay for groceries and tuition and camp and braces and for a new washing machine. Life is so expensive. You take out a line of credit to make a bar mitzvah.

How does everyone else do it? You only use the credit card for emergencies, but there are so many emergencies. It’s not like I’m splurging on a vacation. I have no choice but to fix the fridge! Sometimes it feels like all your income is going to monthly payments. I work so hard and I don’t even see the money. You try not to think about it. Because what can you do about it already? Until you can’t make the payments. This is getting out of control. The debt cycle becomes a death spiral. My whole life is a mess.

Is there a way out?

SIX FAMILIES RETRACE THE JOURNEY

Name: Aryeh Derringer

Age: 29

Family size: 3

How much debt you paid off: $23K

How long it took: 2 years

Total household income during that time: Started at $45K, we managed to push it up to $110K by the end of that period

We thought we were living within our income. But we’d never saved.

We got into debt by accident.

I guess no one gets into debt on purpose. But what I mean is that we didn’t realize we were getting into debt. It’s not like we made a formal decision to take out a loan or borrow money. We just didn’t realize that we weren’t covering our expenses anymore.

I used to say it started when we moved to a new home, and our income and expenses changed suddenly. But looking back, I know it really started before we moved. It started when we didn’t plan for the move by saving in advance for the cost of the movers, the real estate broker’s fee, and the extra expenses involved in moving. We just assumed it would all work out somehow — but of course, it doesn’t just happen like that.

Moving was an enormous upheaval. I started a new job. My wife had to start commuting to her existing teaching job. We had a new neighborhood to acclimate to and new schedules to adjust to. It was pretty overwhelming, even without thinking about our new financial reality. Which we didn’t.

Until I got the credit card bill.

“We have a pretty big credit card bill,” I told my wife. All the extra expenses had landed on the credit card.

“How big?”

“A few thousand.”

She was shocked, but we rallied — the school year was almost over, and then she’d get a better job. We could pay off the credit card in a month, I figured. It would be okay.

But it wasn’t okay; after four months, our credit card bill had ballooned to $23,000.

Twenty-three thousand dollars!

But what were we supposed to do about it?

It was tempting not to think about it — to put my head down and keep working and hope it would resolve itself one way or another. But that strategy hadn’t worked until now.

We tried writing a budget. That solved one problem; we were able to see clearly that our income wasn’t enough to cover our expenses. But it didn’t actually give us more money.

Trimming our expenses to fit the available income was really hard. My wife’s friends were going out for ice cream, and she couldn’t join them. When my brother got engaged, we didn’t have money for a babysitter, so we took the baby along to the l’chayim. It wrecked his schedule and the whole event was less fun.

In the past, we’d have just said, “Well… we need a babysitter,” and not thought any further about it. Now we didn’t spend a penny that we couldn’t account for on paper. We never ate out, not even for our anniversary. We forced ourselves to cut our grocery budget by $200 a month, which made grocery shopping very stressful. When we were invited to chip in for gifts for family or friends’ simchahs, it was always a crisis — we just didn’t have the money.

I felt angry and disappointed in myself. All around us, our friends and siblings were buying houses, moving up in life. And we were stuck in place, killing ourselves to pay off this enormous sum. We felt like we were choking, and I felt like a loser.