How I Got Out of Credit Card Debt

Today's post will definitely stand out among my usual style blog posts but I felt compelled to write it because 1) I have mentioned this topic before and so many of you expressed interest in hearing my story 2) we live in the social media age where a lot of people live above their means to portray an aspiration lifestyle that has reminded me of me in my 20's and 3) I'm hoping that sharing my story will help any of you out there who may find yourself in a similar situation.
how I got out of credit card debt
What I'm wearing: Chicwish Topcabi Cropped High Straight Jeans | piggy bank | blush & beige rug

Before I jump in, this is a disclaimer that I am in no way giving financial advice and this post is NOT sponsored. It is just me sharing my journey out of credit card debt, now grab your cup of coffee or tea because it's a long one!


I want to give a bit of background because how I grew up set the foundation for my relationship with money. I grew up in San Ysidro (South San Diego) to two immigrant parents who are the definition of hard workers. Even though we didn't have much money growing up, my parents would provide us with what we needed and were also resourceful with what they earned. We lived in low income housing until we had enough to buy our first home and from there through their hard work I saw us progress from that home to bigger homes (movin' on up!), to better cars to then crumbling when my parents got divorced. I wanted to include this tidbit because I started correlating rewarding our hard work and defining success with nice material things.

So where did my relationship with money go wrong...

When it came time to go to college (University of California, San Diego), I still made a financially responsible decision to live at home, commute to school and work part time throughout my entire college career. I only lived by campus my junior year to experience the college life. Even though I didn't rack up an astronomical student loan, I still began a not-so-good relationship with credit cards.

My first credit card was a student credit card to establish my credit. This little card which later I found out had the highest interest rate of ALL of them, kept raising my credit line as time went on allowing me to charge more on it. Meanwhile, I opened a few other ones including department store cards that get you with, "if you open this card today you get 10% off your purchase!" (my response to that line now is "I'm fine, thank you" and most of the time I have to say it twice to the salesperson - bless their heart as I know they are trying to hustle too). I was in my 20's and the combination of living the party life, being single, going on trips, paying for other people (beware the human financial leeches they exist), acting like I had accomplished the American Dream, all the while thinking that I would pay the debt off with the amazing job I was going to get when I graduated college. I was like the girl from "Confessions of a Shopaholic" only I couldn't sell all of my belongings to pay back my debt.

Then I graduated and landed a job in the financial services industry, the day had arrived for me to start paying everything off and regain financial stability riiiiight?? Nope, I continued my spending habits and fell into the next financial trap. Let me just set this up with, the housing market was booming, everyone was buying homes and taking out equity to buy other cool stuff, so I decided to do the same. I thought I would be able to pull out equity from the house to pay off my credit cards.

About a year after buying my condo the housing market fell apart right before my eyes, right under my newly purchased condo's roof! I became upside down on my house because the property went down in value about 40% meaning I owed WAY more than the property was worth so selling it was NOT an option. I was on the hook for the mortgage on the value pre-housing bubble bursting. That's when I just spiraled and started racking up credit card debt to try to keep my house and my lifestyle. The economy then went into full recession mode (around 2008) and although I didn't get laid off, I saw other people get the cut and there were no raises as everything was at a standstill. I will take responsibility for somehow still going on a trip or two to Vegas, buying outfits to hit the club, but it all caught up to me when I maxed out ALL of my credit cards. The nail on the coffin was when I had to charge my property taxes on a credit card because my dumb butt didn't have it included in the mortgage payment. I faced the shame of getting my credit card rejected at a restaurant- THE most embarrasing feeling ever! In the end, I was facing over 5 credit cards and over $30k in debt, all with crazy interest rates over 20-something percent. I couldn't sleep, I couldn't open my mail, I couldn't answer calls because it was usually a debt collector harassing me, I had hit rock bottom. Something had to change or else I was going to lose the house I tried to save, and declare the b- word.

So now, how did I pay off all of my credit cards? 

The simple answer is, I found a non profit debt counselor who started knocking some sense into me and I went on an aggressive payment plan that took me 42 months to pay off. No it wasn't a debt consolidation it was literally paying every penny plus a s---- load of interest. Sounds so simple but the truth is the monthly payment was paralyzing, like paying someone's rent on top of your mortgage. It's important to distinguish the difference between paying off and conquering credit card debt. I write this post because I think to conquer debt I HAD to change my relationship with money to make better decisions and stay out of it. Below I am going to share the lessons and principles I used to change that mindset.


This. I can literally just end the post here and drop the mic because that is the golden rule of getting and STAYING out of debt. Since I had lived outside of my means when it came time to pay it back, I had to live below my means for a while (even now because I'm traumatized). I had to make adjustments and keep an eye on my finances which leads me to...


My first goal when tackling debt was categorizing ALL of my expenses and seeing where my money was going. In a session with a debt counselor, we looked through my monthly expenses so he could give me guidance. I think he was trying to get me to snap out of it by pointing out what were actual necessities. Things that I thought were necessities like cable, gym membership, dining out, travel, clothing, nails, hair, even the type of cell phone plan I had that I stubbornly clung on to had to be cut or adjusted in order for me to be able to make my monthly payment to the credit cards. Every penny counted.

To this day I keep track of everything that comes in and out of my account like a hawk, I look at my monthly expenses and I strategize on where I need to make adjustments. For example some months I notice a spike in eating out, so I'll make an effort to make more meals at home to save money. Or you can also notice if one of your bills goes up and you can look into why the increase (I notice this with my cable bill and we'll call them up to see what deals they can offer or threaten to leave, and their tune changes). I do all of this on an excel spreadsheet (because I'm an excel geek) but there are so many apps that can do it for you. Knowing your income and expenses even if the expenses are higher than income is a way to stay in control of your finances and know what to work on. The biggest mistake I made was the whole "out of sight out of mind" and it only bit me in the a--- because some of these companies were tacking on fees, etc. Had I caught certain things earlier I would have been able to avoid certain fees or make better decisions.


Once I knew my income vs expenses I knew what I could and could not afford. It's important to note that once you are in the hole it's hard to get out of it, and for me I had to sacrifice the lifestyle I thought I loved and was going to lead. For instance, in the midst of this, I had to sacrifice getting a newer car because I couldn't afford it so I drove the same car for 11 years. I was embarrassed that I, a working woman with a good job, still drove her high school Honda Civic but I had to suck it up because I had no choice. Other sacrifices included not traveling (while I would see everyone else doing so), I didn't buy anything high-end (thank goodness the recession made Target a cool place to shop) and I started saying NO, a lot. For the first year and a half it was hard, there was a lot of FOMO (fear of missing out) but after a while I felt empowered because I was also letting go of the shackles of keeping up with the Joneses.


I use to play the comparison game and gosh, that was torture! I saw this quote that pretty much explains what I became, it said something like "I'm too busy tending to my own grass to care if yours is greener". When push came to shove, I put the blinders on and focused on my own sh--. I became numb to seeing others posting amazing and fabulous adventures (something that comes in handy these days of social media), I recognized that was their source of happiness and how they choose to spend their time and money, and good for them, but that's not my journey or my priority. My priority was to get out of debt and become financial stable.


If you are currently reading this and find yourself in a similar situation, I know you wish you could wave a wand, win the lotto and make the debt disappear, but honestly should that happen, our mindset and behaviors would not change so what's not to say you won't end up in debt again? The thing about shortcuts like debt consolidation or bankruptcy is that it's a band aid to our errors with money (unless the debt came from circumstances out of our control like medical bills, etc).

I am thankful that it took me over 3.5 years to pay my debt off because every day was a reminder that I was paying for the consequences of my reckless decisions. It's kind of like a diet, you want to lose 30 lbs but to lose it you have to sacrifice and work hard to lose a pound at a time, over time. I will say that unlike dieting, I couldn't fall off the horse when it came to my monthly payments. I was on the straight and narrow because one missed payment would cause the whole thing to fall apart because most, if not all credit card companies are not forgiving.


The day I made my last credit card payment was surreal, I was in denial that I was finally credit card debt free. I have maintained the same living below my means lifestyle, and for a few months pretended I still had that credit card payment and put it in my savings account or put it towards my student loan instead. I TRIPLE checked that I could afford getting a new car, which I did because my civic was starting to stall and scaring the s--- out of me and when I went to get the car I realized my credit score had improved drastically. This whole part of my life has really traumatized me, and I NEVER want to utter the words "I'm broke" ever again, I never want to live paycheck to paycheck again, I never want to not have the funds to help a family member in need again, I don't want my son to learn these lessons the hard way either, so I'm extremely diligent about making sure I have an emergency fund. I would say do research on what an emergency fund would mean to you and know that when you're done paying your debt (which I believe you can do, I'm cheering for you) that journey is not over. Build your emergency, savings fund, college fund for your kid(s), retirement plan, and build your wealth- I think this is extremely important for us who come from immigrant parents or lower socio economic status. We got taught to work hard and with integrity, but not to handle our finances so a lot of us keep this broke mentality going for generations.

how I got out of credit card debt, changing mindset to get out of debt

In conclusion...

Halfway through this journey, I met my husband at a random hole in the wall bar I had never been to (not those fancy clubs I kept buying outfits for LOL), he saw the car I was driving so he wasn't scared off then (lol, again) and we connected on our financial journeys too, although he is WAY more conservative with money than I am. After I paid all of my credit cards off over 7 years ago, I cut them up and never wanted to see or use them again. I still receive a gazillion offers to open a 0% interest rate card and it goes straight into my shred bin. I did finally get the courage to open one, that I researched in depth and I only use responsibly, but end up paying it off right away because again, trauma.

So as I wrap this post up, I can't help but wonder what would have become of me in this Instagram era had I not changed my mindset. It's SO easy to see the next IT purse or IT destination and get influenced to do the same. Old Pau would be all about it. But then again, I'll use me as an example, I was showing off my elaborate trips to Vegas, Hawaii and New York yet I was b-r-o-k-e so the lesson here is perception is NOT reality folks! Focus on your grass, if you need help, do your research and find an expert and know that it is achieveable. Hope you enjoyed reading this post! Want to keep the conversation going? DM me on Instagram here!

Best {Fashionable} Regards,


  1. Thank you so much for sharing Pau and your advice is SOOO valuable. I also had my first CC and the end of college and totally messed up my credit for a while. And I was so bad at saving and regret not being able to buy anything when the housing market crashed because I had no savings/cushion I'm really impressed you bought a condo, (eventhough the market was so crazy at that time). I'm going to share this post and send to friends. It really helped inspire me too to be better about watching where every dollar goes personally and for my business. Thank you again for sharing. PS - I can relate to those pricy Vegas trips in my early 20's lol. Ugh ;)

    1. Thank you so much Dale! Yes, I guess we all makes our mistakes in our 20's LOL

  2. Such great advice! I'm not a fan of credit cards (I paid my debts while in the Army #enlistmentbonus!). The way I think of it now, If I can't pay for it in cash...then I don't need it. Great post, amiga!

    1. That's a great way to think about it! "if I can't pay for it in cash... then I don't need it" love it.

  3. Paulina, this was such an astute and eye opening post that everyone needs to read! Thank you for sharing your journey and aspiring others to be financially responsible. It is so important in this day and age and you're right, not a lot of people are taught how to do it. Excellent post!


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