How a Best-Selling Author Paid Off Her Credit Cards

By Kimberly Palmer Personal Finance NerdWallet.com

Sarah Hepola might be known primarily for her best-selling memoir, “Blackout: Remembering the Things I Drank to Forget,” about her struggle with alcoholism. But two years before she became sober, she confronted another demon: credit card debt. In many ways, she says, coming to terms with her spending habits was good practice for dealing with her drinking problem.

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Sarah Hepola, on her former debt: “I knew the number was bad, but until I saw it, I didn’t have to reckon with it.” (Photo by Zan Keith)

“[Paying off the credit card debt] was like the little earthquake, the tremor that came before getting shaken to my foundation,” Hepola says. “When I quit drinking, it was the worst time in my life, but it was quitting drinking that really allowed me to have a life that I could afford in a larger way.”

As she dealt with both issues, Hepola moved to Dallas from New York City. The lower cost of living allowed her eventually to pay off her $10,000 credit card balance, as well as $40,000 she owed the IRS.

Hepola shared her journey out of credit card debt in a recent phone interview. Her responses have been edited for clarity and length.

When did you realize you had a problem with credit card debt?

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When the credit card companies alerted me to the problem. The creditors were calling. Like a lot of people my age, or so I thought, I had a sampler’s plate of high-interest credit cards that I tended to max out and then ignore. Part of it had to do with living in New York, a city I couldn’t afford. I still wanted to go to the bar and buy $16 cocktails, and I figured that I would get the big assignment or big, lucrative job that would allow me to pay off the credit cards in a dreamlike lump sum.

How long did that go on?

I built up the debt during my first three years of my time in New York. I also owed two years of back taxes to the IRS and hadn’t settled with them yet. That was $40,000, and the credit card debt was around $10,000. It felt like the scene in movies where the police chase you into a corner. I was like, “I’m coming out with my hands up.” I reckoned with all the debt at once, but the credit card debt was the first part I dealt with.

Was the credit card spending related to drinking?

Some credit cards give you a pie chart of what you spend. Mine was 75% on bars and wine stores. It was also around the time of the recession, and a lot of attention was being given to people buying clothes and having 100 pairs of shoes. I had nothing to show for the credit card debt, but I got to go to fancy restaurants and drink $20 bottles of wine. I did have a drinking problem, but there are plenty of people in the same boat who didn’t have a drinking problem. I just felt entitled to that kind of leisure lifestyle.

How were you able to pay off the debt? What changed?

I had to get very real about what I was and who I was. There was an element to it that is like becoming sober. The connection between my credit card debt and my drinking problem is that both reflect a person that doesn’t really want to admit who she is. There is a certain level of pretending and hiding — pretending to make more money, pretending to be more extroverted, less cranky and more fabulous than I am.

When I cut up those credit cards and said, “I will now live according to the money I have,” that was part of the path that led to my getting sober. It was one of the first shocks of reality. The party doesn’t just go on; you have to pay for the party, literally with money, and the consequences of the hangover and the mental and emotional drain of drinking that much.

There were small things I did. I stopped getting my $4 latte, which I missed like crazy. It was one of the small joys of living in that little corner of Brooklyn. I stopped doing things like getting food delivery service. I stopped outsourcing and starting doing things myself: making dinner, doing laundry, making my own coffee. I said to my friends, “I can’t go to these big dinners anymore,” and they said, “That’s fine, let’s take a walk.”  I also borrowed $2,000 from my father, which got me out of hot water with the creditors.

You write that one of your first steps to confronting the debt was to add up exactly how much you had. Why was that so hard to do?

It was like stepping on a scale. I knew the number was bad, but until I saw it, I didn’t have to reckon with it. Until I sat down and said, “You have $2,000 here and $2,000 there; this is what you owe,” I could just shrug it off. Until I added it up, I didn’t have to truly confront it.

Do you still worry about credit card debt? Could it happen to you again?

When I sold my book, I had all of my credit cards paid off but had a tiny bit of IRS debt [remaining ] . I called them to do a lump sum, and they said, “You owe $13.” That was five years ago. In that time, I’ve been extremely careful about my credit cards. Why do I still live in Dallas? I have an affordable house, I can afford my life, and that is such a good feeling. It’s been hard for me to find a community of creative people here — it is more of a business center — [but] that’s a decision I’ve made. It feels like a very adult decision, to live according to my means, which means giving myself freedom in some areas and restrictions in others.

You’ve said that credit card debt almost seems like the norm in our culture. Did that make it easier for you to feel like your debt was not a problem?

I didn’t think there was anything strange about anything I was doing, just with how bad I was with it with high interest rates. My friends who are good with money say, “How did you do this? You got terrible deals.” It’s because I wasn’t really paying attention. It felt very normalized. Who pays with cash, especially in New York? There was a time, when you talk to older people about life before credit cards, that if you didn’t have money, you couldn’t buy something. Now we have a “buy now, think later” mentality. It’s a very appealing idea.

It sounds like you use credit cards in a smart way now?

I did cut up my credit cards, but there are situations where you need one. It becomes a problem at some point if you don’t have one. I do have credit cards, and I keep them at a zero balance.

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