My 10 Years of Living Debt-Free

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Good Evening:

10 years ago, on June 3, 2003, I felt certain of exactly one thing in my life: the San Francisco Unified School District would soon hand me an official letter notifying me of my impending layoff.

How did I know? Simple. I wrote the letter.

The letter counted as part of my job working in Human Resources; create a letter template notifying Classified employees that the SFUSD had to lay them off, create an Excel spreadsheet with their names and addresses, and then merge the two. I just happened to be one of those folks getting merged.

Candlestick Point, San Francisco, 21 May 2013, 3:21 p.m.

Candlestick Point, San Francisco, 21 May 2013, 3:21 p.m.

The Office Chair Waits for the Office to Open, Lech Walesa Ally, San Francisco, 29 May 2013

The Office Chair Waits for the Office to Open, Lech Walesa Alley, San Francisco, 29 May 2013

(Incidentally, these recent photographs of San Francisco bear no relation to the subject of this blogpost. I chose to include them solely because people have requested that all of my posts include pictures.)

San Francisco suffered greatly during the first decade of this millennium. People abandoned the city to purchase their first homes (only to lose them when the adjustable rates of adjustable rate mortgages adjusted upwards), state monies for our schools dried up, and even the 49ers and Giants had down decades. Thus lives America’s ultimate boom-AND-bust city, and I would soon bust.

Therefore, on June 3, 2003, I did something foolish.

I had steadily whittled down a large amount of a certain type of debt to the point where only $2,300 remained. It seems frustrating that I had come so close cleaning up my finances, only to have this happen. So out of frustration I went and wiped out my remaining debt using money I really should have kept to help me survive unemployment. But then a funny thing happened.

Cross Section of Cut-Down Tree, Land's End, San Francisco, California, 27 May 2013

Cross Section of Cut-Down Tree, Land’s End, San Francisco, California, 27 May 2013

Marin Headlands at Dawn, 27 May 2013

Grey Series: Marin Headlands at Dawn, 27 May 2013

Like a runner winning the Olympic Marathon by a single step, I avoided getting laid off by a few days of seniority.

That felt weird, not good. Felt much better when the person just below me got rehired very quickly.

Two consequences ensued: the first and obvious, I retained my job; the second, I had just given myself a $250 per month raise. Tax free. Funny thing about paying off your debt in such a dramatic fashion: you can do the exact same job you always have and yet you can force yourself to get a raise–and nobody, nobody can stop you. Obviously, I have become a believer in living debt-free and encourage everyone to do so if possible, but how can one achieve this, and what entails from such a lifestyle change? More important, how can you remain debt-free?

Moscone Center, San Francisco, California, 28 May 2013, 6:13 p.m.

Moscone Center, San Francisco, California, 28 May 2013, 6:13 p.m.

Folsom Street, San Francisco, California, 28 May 2013, 6:20 p.m.

Folsom Street, San Francisco, California, 28 May 2013, 6:20 p.m.

The first point to make is that I don’t live a truly debt-free lifestyle and therein exists one huge pitfall. My debt-free lifestyle is more of a pay-off-my-credit-card-debt-IN-FULL-twice-each-month-lifestyle. So that dang credit card becomes a nasty, nasty temptation, as you can well imagine. The trouble is that the Internet has made life without credit cards almost impossible. Pretty soon, I will run out of free space for my blog, which means that the kind folks at Automattic will have to ask me to pay for more gigabytes (and they are nice people, I’ve met a lot of them). Too much of my commerce takes place on the web, and too much of that commerce requires a credit card. So I have one card that pays cash on my purchases, and an emergency card from my bank that I reserve for serious medical or travel emergencies. To avoid overspending, the best I can do consists of two things. First, I envision what the money I might spend looks like in ten dollar bills, lined up end to end. Second, I remember what life with debt was like.

More important, I rethink my life in terms of Needs, Improvements, Nice-To-Haves, and Feel-Goods. According to legend, somebody, allegedly Robert Carlyle, allegedly said some wise saying that allegedly “to increase the fraction of life, one must increase the numerator or decrease the denominator.” Let’s take a closer look at that.

People Waiting in Line for the Evening Bag Meals, Civic Center, San Francisco,  28 May 2013

People Waiting in Line for the Evening Bag Meals, Civic Center, San Francisco, 28 May 2013

Office Building Being Gutted, 100 Block of Van Ness Avenue, San Francisco, 30 May 2013

Office Building Being Gutted, 100 Block of Van Ness Avenue, San Francisco, 30 May 2013

Let’s say your current “fraction of life” is 3/3, or 1. If you increase the numerator by 1, your new fraction becomes 4/3, roughly 1.33. If you decrease the denominator by 1, your new fraction becomes 3/2, or 1.5. In other words, cutting back makes you richer–and better yet, that is something you can control.

The first step for me didn’t pose any problem: what do I absolutely, positively, need to buy? The answer, as it turns out, is nothing. Everything I needed–food, clothing, shelter, health care–I already have. Second step: what do I not have that would constitute a distinct improvement in my life? Fortunately, the answer remains nothing. My six-year-old iMac has slowed down, but it’s still healthy, my DSLR is seven years old, but people still like my pictures, my 31-year-old 10-inch French Chef knife still has a keen edge thanks to my friendly neighborhood knife sharpener, and so on, and so on. Yes, I can afford more living space, but I have had over 800 square feet all to myself for the past nine years, and the rent is only 18.26% of my salary–a huge, HUGE key to survival in one of America’s most expensive cities.

The more items in your life that you can downgrade from Needs to Improvements to Nice-To-Haves, the more items you postpone buying into the future–or even forego entirely.

White & Blue Series: Harrison Street, San Francisco, CA, 1 June 2013

White & Blue Series: Harrison Street, San Francisco, CA, 1 June 2013

White & Blue Series: Sky Above Harrison Street, San Francisco, 1 June 2013

White & Blue Series: Sky Above Harrison Street, San Francisco, 1 June 2013

Nice-to-Haves and Feel Goods are tricky. A Nice-to-Have is something that would benefit at least one of my careers in some fashion, but I have done well without so far. For example, I’m an actor with no demo reel, no voiceover CD, nor personal website. I’m also an actor with over 220 bookings in his career, including lead roles in indie features (none of which went anywhere), series pilots (none of which went anywhere), et cetera. So these other things do have long-term benefits, and they will all be nice to have some day, and will help my career, and yes I will eventually have them all, but I’m in no hurry at this time. However, this can change. If I should move to Los Angeles to pursue an acting career there, all of the aforementioned Nice-to-Haves will suddenly become legitimate Needs.

A Feel Good is pure instant gratification with no long-term benefits at all. It’s that $4 coffee with the 1$ tip you buy every morning, five days a week, fifty weeks a year, costing $1,250 annually (until the price goes up again). It’s that ridiculous looking and frivolous purse for $150 you can buy because your insurance agent saved you that much in a year, and you will feel ever so instantly gratified for at least a day until it gets snatched because it was such a big and easy target.

Yes. It also helps to learn to hate materialism.

The big problem with Feel Goods is that sometimes they can feel, and even become, needs. Vacations are a great example: sometimes, we need to get away, as I did during Weekly Photo Challenge: Escape. See here, here, here and here. Oops, I forgot, and here, too. The neat thing about all of these is that aside from the fare to take BART light rail into Oakland, travel cost me nothing. Fortunately, “film” developing has also become free these days. Yes, frivolity does sometimes become vital to your, um, vitality. But that does not mean you need to shut off your brain.

And that counts. Maintaining a debt-free lifestyle essentially boils down to KYBA: Keep Your Brain Awake. Look around. Almost everything you think you need–you probably don’t. Almost everything you think would improve your life–either doesn’t or can be postponed. Nice-to-Haves and Feel-Goods are tricky and treacherous because they do a good job of acting like Improvements or even Needs. Keep Your Brain Awake.

Once you’ve forced yourself to get a nice monthly raise, tax-free, divert almost all of that money into savings or retirement accounts before you get your hands on it. Reduce as many of what you think are Needs and Improvements to Nice-to-Haves and Feel-Goods as possible. Don’t waste your money on the Nice-to-Haves and Feel-Goods. Keep telling yourself, “The ads lie. I don’t need to buy that.” Simplify, simplify, simplify.

Decrease the denominator of your life.

I cannot cover everything in a single blogpost. Ha! Far from it. I haven’t touched on unforeseeable disasters that can force you into debt, for one thing. Not only that, I don’t consider myself an expert on money matters and recommend that you don’t believe a single word I write before you have double-checked with a pro. Enough ill-informed, ranting and raving pseudo-wisdom. It’s after 11:00 p.m. and I need to start baking chocolate chip and walnut oatmeal cookies for my co-workers for Monday morning to celebrate the 10th anniversary of my debt-free lifestyle.

Yes. It’s a Feel-Good.

Insert ironic smiley emoticon.

Vonn Scott Bair

PS–I hope co-workers call my cookies a Taste Good.

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8 responses »

  1. Good post Vonn! My husband and I spend quite a bit of time in NYC and honestly I find myself resenting terribly the materialism that is everywhere! Our culture has gotten really out of hand, especially in areas where there are people with a lot of money. I love the whole simplify and de-clutter concept!

    • Tina: Thank you for visiting. My apartment presents a prime piece of pretty paradox–yes, I have simplified my life, but my home is still cluttered with books! If only the iPad had come along a half-century ago… Vonn Scott Bair

  2. Excellent post, in my also-non-professional opinion pretty well informed. I learned to live debt-free from my parents, watching them turn a straight middle-class single wage-earner salary into a successful and stable upper-middle-class lifestyle. Being severely frugal and living debt-free is far and away the reason i’m still not homeless after no steady income since early 1998 (the whole two incurable diseases thing).

    I’ve always visualized money in the same way—as actual money—no matter what its physical manifestation. Whether a credit card, a check, or Federal Reserve Notes, i treat them all like limited amounts of gold coins, *feeling* them leave my wallet, even when just typing numbers into a billing web page.

    I’ve never had an issue with credit card debt, but managed to miss my credit card payment deadline by a day or two one month in early 2012. It *amazed* me how high and how swiftly the interest and penalty rates flew up: *hundreds* of dollars for a maybe $2000 balance if that, for being just two days late! Excellent life lesson, which i knew but for which i apparently needed a reminder.

    • S.P.: I’m glad you’ve been able to cope with the whole two incurable diseases thing. About the late payment, that penalty shocks and disgusts me. Should not be allowed to happen. Vonn Scott Bair

  3. Pingback: 3 Primary Types Of Home Mortgages

  4. Pingback: Birthday, Schmirthday. | The San Francisco Scene--Seen!

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