Top 15 Blog Challenge: Reginald Smith

Editors note: We asked each of our Top 15 to tell us a story about a money-related blunder that they've made.

Happy 18th Birthday

Tuesday, May 6, 2008: A day I’ll never forget and quite honestly, a day that I anticipated forever growing up as a child. I thought the day I turned 18 was the day that I was officially an adult, you couldn’t tell me anything! Graduation was around the corner, I was a few months away from relocating to Kentucky for undergrad and I was finally 18, I felt unstoppable. However, looking back on that day almost four years later as an experienced adult, I can honestly say that day was the day that changed my life…more so, my credit score.

I walked to the cash register in Macys with a pretty cool outfit for my birthday celebration that weekend. As I approached the register and the cashier started to ring up my items, she looked me dead in my eyes and said, “You can save 30% by opening up a Macys charge with us today.” It’s like she knew, she knew that I was finally an “adult” and I could make these types of decisions on my own. I immediately said yes and jumped on the opportunity without even thinking. In my young and immature mind, I looked at this as free money. A way that I could get all these items in my hand now and still walk out with the cash I came with. Oh, and lets not forget, I managed to save 30%! I thought I hit the jackpot; I even shopped around more and added more items to my purchase. I was excited, I wanted to jump over the counter and hug that saleswoman because in my young and immature mind, I thought she did me the ultimate favor. Little did I know, this was only the beginning of opening irresponsible charge cards and dealing with persistent creditors. She didn’t do me a favor at all; she was just doing her job.

I started undergrad that fall and this was the first time I was away from my parents. Suddenly, I had this new freedom. I felt like I could do whatever I wanted without my parents breathing down my neck and checking on my every move. I didn’t have my mom there watching over my purchases and knowing what I spent my money on so I went ballistic. I can honestly say now, I was out of control. I began to convince myself that I needed to make mall trips to use my beautiful red charge card from Macys. I had a pretty decent on campus job and all I had to do was pay the minimum amount to stay in good standings, I had it all together. At least that’s what I thought. I began to open more charge cards without even looking into things such as interest rates and different policies. Suddenly I began to reach for my charge cards when it came to make a purchase instead of the cash I had in my pocket. I looked at my credit cards as free money, which was a huge mistake.

By my sophomore year of undergrad, I began to fall under hard times. I was no longer a college freshman that constantly received money from family members because they were worried about me, they figured I had adjusted and although I should have, I didn’t. That nice job that paid for minimum account balances wasn’t cutting it and that’s when things seemed to go down hill. Suddenly, I couldn’t afford to pay my monthly payments and I had fallen behind. Those 1-800 numbers seemed to constantly call and it was depressing.

I’ll be 22-years-old next week and I have learned a huge lesson from my charge card blunders. It is important that as young adults, we learn the difference between our wants and needs. I often found myself using my charge cards more for wants than actual needs. I began to open up unnecessary accounts that ultimately affected me in the long run. If you don’t need the charge cards, don’t open them and if you find yourself with them, spend responsibly. It is important that we look into interest rates, policies, fees and other things associated with the charge cards before being so quick to sign up for them. Most importantly, know that charge cards aren’t free money and you have to pay them back one-way or another. They should only be used for emergency reasons, if at all.

Looking back on Tuesday, May 6, 2008 years later, I have a different perspective on that day. At 18, I looked at that day as me becoming an “adult” and making decisions on my own. However, now I realize that day meant so much more. It was a day that finances, credit scores and financial stability really became an important factor in my life. I was no longer the little boy that relied on his parents for everything; I became an adult that began to create his credit score and finances. Through everything I’ve been through with charge cards, I wish I would have done things differently. However, life makes the best teacher. Don’t let this happen to you! Be responsible when it comes to charge cards and avoid them if you can. In the end, it isn’t free money and you must pay it all back.

Reginald