Like most of the middle income employees in their mid to late 20’s I’ve been one of the victim of credit card debt too. Spending on things that I don’t need, using money that I don’t have. I’m a typcial woman who splurges on shopping, frequent dining out and travel and car expenses. I used credit card in all my purchases, even with utility bills. The more I spend, the more credit card companies sent approved credit cards, ready to swipe. I got my first credit card – Citibank Visa Card when I started my first job, Citibank approves 10k credit limit. Then, as I purchase more, they gave Citibank Cash Back Card. After sometime, because of free gifts promo, I applied for HSBC Red and Rustan’s Citibank, it was both approved. Without applying, Metrobank, BPI and Union bank delivered pre-approved credit cards in my office. So how many cards I have now, 7! Yes, seven credit cards, with 500k credit limit. Though I consider myself disciplined in finances, I messed-up! I messed-up with finances. I ended up with unnecessary purchases, wrong financial decisions such as availing card companies balance transfer, instant cash promo, etc. Until I realized I have 250k worth of debt. Because of this, I lived in a rat race, living payday after payday. My pay goes to expenses and debt, what left with me is my allowance just good enough until the next payday, nothing left for savings too! I even compromise my tithes and giving, that’s the saddest part. The fact that I can’t give back what is due to God and I can’t give whenever there’s opportunity to bless a family or friends who are in need.
So I prayed (“Father, make me financially free) and decided to cancel my debts. It’s not easy, you really need to decide and commit to your decision. I even have to lessen my expenses and find ways to increase my income. I made it a goal to cut credit cards. I literally cut BPI, Metrobank and Union Bank, the cards I never used. Then, I settled Citibank Rustans and Silver Visa, and cut it too! Then I settle HSBC, and decided to maintain it, since I get 3% discount on fuel (Caltex), use it for online and out of the country purchases. And now, I was left with Citibank Cash Back, where my 72k purchases blew up to 147k (purchases + interest). I decided not to pay this at all, because, I also heard from several friends and colleagues who also faced the same issue, and they don’t bother settling their debt with their credit card companies, but even after 5 years or more, credit collectors are still bothering them. After 6 months of not paying even minimum amount due, Citibank started calling me and it was really irritating. They called my mobile phone, my office phone, asking or even threatening me to pay my debt as soon as possible. I also received letters from a Law Office, saying that they will file case against me if I will not pay my debt. Honestly, natakot ako, I don’t want to end up in jail, nakakahiya. So I started to research if this is true, I read blogs about this and found out that in Philippines no one can be put into jail. Until one day I read this tweet from Joseph Bonifacio, 2 Kings 4:7 “She went and told the man of God, and he said, “Go, sell the oil and pay your debts. You and your sons can live on what is left.” I realized that I’m not honoring God in my finances, since I was trying to run away from Citibank, and I was not trusting God enough that He is an ultimate provider. Right at that moment, I decided to settle everything and trust God for provision. I started negotiations with Citibank (actually based on my research I knew that after a year credit card debt is not with Citibank anymore, they sold this with Credit Collection Agencies, and they are the one calling me, trying to collect from me, whatever they collect from me will be their income, that’s why they are so persistent in collecting). Credit Collectors, will always offer you two options, first, is to pay your debt in full including interest earned, within 1-2 years, and second, is to pay immediately without the interest, or even lower than your real debt. As for me, after almost a year of negotiation, they approved 35k payment from my 147k total due. What a blessing! Though I have to wait, I’m grateful that God blessed me to settle debt with Citibank and pay lower amount, way lower than my actual purchases.
Today, I’m debt free! Thank God! And thanks to my colleague Gali Villaflor, who lends me this book written by Mr. Chinkee Tan, Till Debt Do Us Part. What I’ve learned from this book helps me a lot on my decision. There’s so much wisdom from this man plus the truth of Gods promise = powerful, transforming…
“When you get in debt you become a slave.”