Analyzing my Capital One Debt

Like many people in America (and especially small business owners) I have credit card debt.  I am fairly good with money, keeping spreadsheet upon spreadsheet of expenses, deductions, income, as well as a very comprehensive debt-payoff schedule. But, of course, expenses come up, and when credit was there, I used it.

I fell into fairly massive debt (around $15,000) due to poor planning on my part.  It’s the same old story really: living above my means, trusting that a gig would last when it didn’t, and I eventually had to stop, re-evaulate and figure out what I wanted to do with my life and my business.  It wasn’t consumer debt that did me in…I’m the first to admit that I’m not even remotely hip. I don’t have nice clothes, (I shop maybe once a year for a few items) I don’t get my hair done often, (about 2x year at the beauty school or as a hair model), I don’t go out to eat, (I spent about $150-175/month on food), or go out to bars/clubs/events.  My life really is this business, and I was spending money on items and programs and services that I thought I needed, but really didn’t.  To top that, I underestimated my tax liability and owed a hefty amount to the IRS. Not fun.

About two years ago I got really serious about paying down my debt and getting on top of my finances. While I’ve always been good with money, running a business is not exactly easy with inconsistent and random income sources. In the past few years, I have paid off my HSBC credit card, American Express, and IRS debt, my student loan, as well as two personal loans, all totaling around $13,000.  I’m now ready to take on my last interest-bearing debt with a vengeance: my Capital One credit card.

Capital One logo

Capital One logo

I decided to sit down and really look at my Capital One statements and figure out what exactly this $2300 that I owe is for.  I knew I had it for a few years, but wasn’t sure exactly where it all came from.  So I went through my old statements and investigated.

In December of 2008, my balance on Capital One was zero! That surprised me, because I thought I had purchased my Mac laptop on it, but apparently not. In January of 2009, I did a balance transfer from American Express.  This was a good idea (even in retrospect) because I had an insanely good balance transfer offer of 3.99%.

The original balance transfer was for $2300.  Over the past 30 months, I have paid down that balance to $1010.73. (Still at 3.99%. )  Going backwards through time on my American Express bill, I am still paying for:

Domain hosting
Internet/Phone bill
Chiropractic Care
Office Depot purchase
Flash design help
Web program for business
Business Card Design
Newsletter program
Google Adwords
Gas for commuting

While it’s kind of annoying to see these expenses, I don’t feel that bad about them because most were for business.  If I had the cash at the time, I certainly would have paid it, but I was bootstrapping. It’s not an excuse, just an explanation.

Had I just kept to the balance transfer on my Capital One card, I would have been in MUCH better shape than I am today.  But, unfortunately, I was stupid (or desperate) and kept charging additional items to the card.

The portion of my Capital One balance that isn’t the balance transfer is $1289.27…at an interest rate of 17.99%!!!

After going through my Capital One statements for the past 30 months, I discovered that I’m still paying for:

A legal bill (from Feb 2009)
Groceries (from Sept 2009)
Cell phone (from Nov 2009)
Gas and PO box rental (from Sept 2010)
A health class through the YMCA (from Oct 2010)
Gas and phone bill (from Mar 2011!!!!)

But all of those costs together don’t even total half of what I’m still paying on. You know what is?


A whopping $653.06 of my outstanding balance from Capital One is for INTEREST.

Now, I get that I was struggling for a period of time while I was finishing writing my books, getting them out there, and really focusing on what I wanted to do for this business. But I’m pissed. And I have no-one to blame but me.

So, my goal for the next month? To pay off more than $653.06 of my Capital One bill.  It will be a stretch…I will need to sell some stuff, perhaps take on some Mystery Shopping assignments, and other random gigs to fill in the gaps.

But once this beast is paid off, I will feel so damn good.

Update: Want to know how I did it? Read on!


 Think about all the extra money you could make by being a mystery shopper, starting your own business, or working from home for a legitimate company.  Take control of your income and check out our LEARN page for a list of classes, books, and more!

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