In August of 2013, I got married, without even realizing it. It became official the moment I signed that promissory note stating that I agreed to repay the Federal government the money borrowed to fund my education. I had no idea that the only way out was death. Literally. The engagement came in the form of the FAFSA, and the honeymoon was the sizable refund check. Life was good. And then, the marriage began and Tyrone and I have been attempting to rid ourselves of one another since. But I may be in luck. Because I’ve decided, Texas is trying to kill me anyway.
From the Zika infected mosquitoes and heat stroke inducing summers, to the ungodly pollen counts, Texas can be a dangerous place for anyone. Then there’s the absence of toilet seat covers, Texas U-Turns, food portions that resemble the state in size, all smothered in the beloved Open Carry law. Now I don’t think I’ve ever been hunted (except maybe this one time when these chicks thought I was interested in their MySpace thugging), but I’m pretty sure this place is attempting to claim my life. Some of you will remember when I moved here in the summer of 2013, I was attacked (yes attacked) by a spider that I’m pretty sure my old boss dispatched as delayed retaliation for walking away from his bigoted oppression. I’d like to enter into evidence the fact that this attack occurred while a friend and I sat in a dark theatre watching what? Lee Daniels’ The Butler. I rest my case. That’s some petty shit. This spider bite, caused my foot to swell, itch uncontrollably, and turn colors that I didn’t think people of my skin tone could achieve. I’m cool though. God got me.
Later that fall, I became the victim of Uptown Dallas’ uneven sidewalks and tripped over a large piece of concrete, ultimately fracturing a toe. Then, in 2015, after over 10 years behind the wheel, I had my first car accident. I was rear ended and forced into months of physical therapy in an attempt to correct the damage done to my neck and back. To the woman in the GMC truck who decided responding to that text message was more important than my life and the lives of others also on the 30 freeway, I forgive you. *side eye* Later that year, I came down with a terrible cold, which I have to believe was an allergic reaction to Donald Trump gaining traction in the primary. This virus took me down with chills, labored breathing, and a dreadful asthmatic cough, all the same reactions I have during every Presidential debate. By the way, is it hilarious to anyone else that you can hardly tell the difference between SNL skits and the actual debates? Oh, America.
Anyway, last Wednesday, while chasing my furkid around the house, and selfishly trying to reach my ten thousand Fitbit steps, I must have zigged when I should have zagged, because fell and broke my ass in its entirety. And some of my good friends and family know, my roots are very southern, and so that’s quite a bit of ass to be breaking. I slipped and fell on marble tile, bruising what seemed to be my entire right side. Now, I’d like to point out that when I was about 23, I played a pickup basketball game with my ex-dude and a couple friends after a 3 mile run. I took a hard fall on a cement court and got up instantly, because, defense. Someone please let my Lakers know that that’s a thing. But at 28, my body didn’t respond the same way. After this painful fall, I laid there holding myself like Brett Favre on a Sunday after being sacked for the 17,538th time. I’m not even really sure if I was unable or just unwilling to get up. But at this point, I’m questioning the gravitational force in Texas.
Finally, late last week, after months of fighting a skin allergy and trying to treat it by listening to my Mama (who always seems to morph into an MD whenever anyone in the family falls ill), I was sent to a dermatology specialist. While studying the small hyper-pigmented spots on my stomach and chest, the doctor decided to do a punch biopsy at the location the allergy originated. Okay, doc. As I laid on the table, being stitched back together after having a piece of my flesh cut away, I wanted to cry. It wasn’t the pain from the incision (she did a great job numbing the location), nor was I worried about the diagnosis (I’d already talk with Jesus, Mohammad, the Creator and all their friends about this). No, I got choked up because I remembered the way my health insurance is set up.
You see, my employer offers deductible health plans, meaning that employees must cover a certain amount before the insurance company will pay a claim. These plans can be a blessing or a curse, depending on what kind of year you have. Deductible plans can be a blessing if you are generally healthy and make it through the year without any medical emergencies. During these years, your health insurance cost is insanely low. Love that. Deductible plans also work out if you have a medical condition that requires ongoing treatment. Because as soon as you’ve covered your deductible, the insurance company will begin covering a good percentage of your costs until you reach your maximum out of pocket amount. Saving patients that have no choice but pay for needed ongoing care thousands. Fantastic. But, deductible plans kinda suck if you come down with an issue that isn’t chronic and will not require ongoing care. This turned out to be the case with my skin issue. 2016 was generally a good health year for me and so I’d paid almost nothing toward my deductible. I thought because it was nearing the end of the year, I’d get off with almost no healthcare cost for the year 2016. Well, my body had other plans. Because I hadn’t reached my deductible, the entire cost of that specialist visit fell on me. And because my biopsy results came back with a diagnosis that can be treated quickly and with just one round of medication, I got the short end of the insurance stick. Ugh. But yay!
Anyway, I walked out of the exam room wondering if I could make it to the elevator and down to my car without anyone noticing. Then I remembered that Sandra Bland was, in essence, pulled over and killed just for failing to use a blinker (I will not argue with you hotep fools about this). So I slowly shuffled my way to the receptionist desk, encouraging myself, because while I hated to pay this bill, it was a blessing that I’d gone the entire year not needing any medical attention. I’d tried to estimate how much this 25 minute visit and three minute procedure would cost. But you know that terrifying feeling that forces you to freeze when you quickly turn a blind corner and are surprised by an unexpected human face that’s all of a sudden in your personal space? Well, this doctor’s visit was the corner and the bill was that unexpected face. I died a little when the nurse explained that because my deductible hadn’t been met, I’d need to slide her a smooth $650. Damn.
I say all that to say, this place is trying to kill me. But also, life will happen. And some of these happening things will be events that will throw you for a financial loop. Life just seems to work that way. Couples get pregnant while one partner is in school or unemployed, folks are hit with family trauma while pledging their beloved Greek organization, ladies get periods just before a luxurious vacation, and those of us attacking debt have medical emergencies.
These types of unforeseeable events force most of us to grapple with a hard truth: while we’re are out here spending money on shit we don’t need, we’re also failing to properly prepare for rainy days. And I’m not saying that you shouldn’t reward yourself for hard work, but I am asking if you really need every new Apple product the day it’s released. I mean, since Steve Jobs left us the product releases haven’t been the same anyway. I’m just saying. In a 2016 survey by Bankrate.com, it was estimated that 63% of Americans don’t have enough savings to cover a $1,000 emergency. While it’s not news that Americans are consumers, it makes no sense that two-thirds of employed Americans have less than $1,000 in their checking and savings accounts, COMBINED! Now, I know that it’s cool to vacation every other month to post pics on Instagram, drive a car you can’t afford to attract interests you probably don’t want to entertain long term anyway, and buy the new Samsung Gear VR in an attempt seem intriguing. But are things really worth your financial well-being?
When Tyrone and I began this journey, my cousin, Stephanie, THEE debt slaughterer, offered me a great piece of advice. She’s currently finding her way to the end of her student loan repayment journey, which started at $140K. She got there following the Dave Ramsey’s plan. Dave Ramsey believes “cash is king, debt is dumb, and the paid off home replaces the BMW as the status symbol of choice”. Moving stuff, Dave. I took my cousin’s advice, looked into the plan, and adopted a version of it for myself. Let me state, while I like Dave’s plan, I have tailored these steps to fit me. For example, Dave believes individuals should not save or contribute to retirement while in Step 2. But, my company matches my 401(k) up to a certain percent. Yeah, no. I won’t ever turn away free retirement money. So, while I’m currently at the very beginning of Step 2, I will continue to contribute to my 401(k) and max out company matching.
Dave’s steps to financial freedom are:
- Establish a $1,000 Emergency Fund for Immediate Emergencies
- Pay Off all Debt Using the Debt Snowball
- 3 to 6 Months of Expenses in Savings
- Invest 15% of Household Income into Roth IRA’s and Pre-Tax Retirement
- College Funding for Children
- Pay Off Home Early
- Build Wealth and Give
As I take you all on my journey from Six-Figures Under to debt freedom, I figured I should also share my strategy. But before I share the debt snow-ball spreadsheet I’ve created, I wanted to explain my version of Step 1 as a prerequisite to jumping into a debt snowball.
Step 1: Establish an Emergency Fund for Immediate Emergencies (My Version)
I agree that establishing a liquid fund solely dedicated to emergencies should be your top priority. Because we talked about this. Things. Will. Happen. But, in my opinion, $1000 isn’t enough. While $1000 will probably cover most auto repairs or even an insurance deductible, there is that small statistical chance that multiple things will happen in a short period of time. And with my luck, they will. So my tweak to this step is upping that savings to $3000 for an immediate emergency fund. I came up with $3000 after considering my risk and income. For example, I have a deductible health insurance plan, a house, and a couple dogs. And since we can all agree that Texas has something against me, I’d rather have a little extra cushion.
So let’s just say one of these ignorant ass, violent Texas storms comes through, high winds catches one of my beautiful Pecan trees, the tree falls on my roof, the dogs and I are standing right under that part of the roof, and we get our asses kicked by a couple larges pieces of falling drywall. I know it’s a slippery slop. But you never know. I’m just saying. IF this happens, I’ll probably need to drop money on medical expenses for all three of us, while also covering the home insurance deductible to have my home repaired. Now obviously that’s a worse care scenario, but because of that small chance of it happening, I’d like to have a more than $1,000 liquid and easily accessible. The point is, expect the best but prepare for the worse. Keep this money in a savings or checking account so that you have the ability to access at a moment’s notice.
Accomplishing Step 1 took some cutting back on going out, taking lunch, and simply becoming aware of my spending. The small sacrifices are worth knowing that I have funds set aside just for emergencies when before I’d probably need to dip into a savings account or reach for a credit card. I’m officially in the 37% percentile of Americans who will experience an emergency. But I’m still in the crosshairs of pollen, gravity, marble floors, spiders, tornadoes, and uneven sidewalks. So, if I should be taken out by that falling drywall, do me a favor and split the emergency fund up between my nine nieces and nephews and tell my loan servicer to go on and take care Tyrone, because that’s only way the Federal government won’t expect its money. Till death due us part.
State of Tyrone
My NelNet student loan statement as of 10/18/2016. $103,501.06.