The Value of a Walk-Away Option and Screw-You Fund: The Real Reason I'm Doing This
Day 134 | $57,116 paid | $33,601 till freedom
Do you remember that mysterious "funk" I've been feeling? I first referred to it on 11/29, then again on 12/4, then I thought I had figured out its source on 12/11. I originally labelled it as a "general malaise," and I didn't know why I was feeling it. On 12/11, I thought I had could blame it on the fact that my money was no longer going towards cool stuff like it once did, but was instead going towards my student debt, and I found the whole experience very demotivating and funk-inducing.
Well, I think the my subconsciousness has finally given me a peek into its deep inner workings. Now, I'll be the very first person to admit that I'm not the world's most self-aware person, and this blog has been one huge attempt at trying to understand myself better--what drives me, why I do what I do, etc. But I think I've had a critical insight into what was causing this funk and why I'm trying to pay off my student loans in such an accelerated manner.
On 9/5, about a week into NMHD, I listed all of the reasons why I thought I was doing this crazy financial stunt. The truth is, I didn't really know why I was doing it, so I wrote down all of the reasons I thought sounded right. And some of them are actually quite valid and applicable. The first two reasons I listed--to have the option of starting my own business and to get off the treadmill--even alluded to the real, underlying reason in a round-about way.
But today, for whatever reason, it finally dawned on me exactly why I'm trying to pay off my loans so quickly.
I'm not going to go into specifics because the purpose of this blog is to neither have NMHD Pity Parties nor is it to libel the place that gives me a great paycheck every two weeks. I will simply say that I was passed over twice for a promotion in my then-current role. (The first time I missed the promo was in March, the second time was at the begining of August--the same month I started this blog.)
I didn't understand why I had been passed over, so I escalated to HR, but they were impervious to my pleas and arguments. At that point, I thought about leaving the company. The only problem? I couldn't walk away. My salary paid for my high standard of living and allowed me to pay the regular rate of my student loans. I needed that salary. And that salary was so high for the Austin area that I was convinced no other local company could match it; Fortune 50 companies like the one that I work at pay MBA-level salaries all day long to people with four years of work experience and no technical skills (i.e., me) because they can afford to invest in them and groom them over time. Very unfortunately, there aren't that many Fortune 50 companies in Austin.
And moving to a new city for a new job wasn't an option because 1) I have great friends here, 2) I love Austin, and 3) I had just bought a house using the $8k First Home Buyer tax credit and couldn't afford to both sell the house at break-even (blasted realtor fees!) and pay back the credit to the government.
So I was stuck. Looking back, it dawned on me, albeit subconsciously, that I had become a prisoner of my standard of living and student loans and I was being forced to work at a company that didn't value me the way I thought it should.
Despite my ruffled feathers, I still came to work every day and applied the same exact effort (very high), delivered the same exact results (very solid), and had the same interactions with all of my business partners (very positive).
However, I was no longer "feeling it."
I looked within the company for a new job that would also serve as a promotion and I found one within two weeks. I even got a 6% raise out of it. Missing the promo twice combined with my lack of a walk-away option terrified me into taking action to find one. (I did have a small Screw-You Fund, but given the size of my loans and standard of living, it wouldn't have lasted very long.)
So I decided, subconsciously, to pay down my debt so it would be easier to walk away if I were to ever encounter another bad situation at work. I convinced myself in that post on 9/5 that I was doing the pay-down for a bunch of very different reasons, and the first two hinted at the true reason, but until today, I never made a direction connection between the events that happened at work, the way they made me feel, and my mission to pay down my student loans.
Is it odd that it took me this long to make the connection? Am I that out-of-touch with myself? I don't know. Writing it down like this makes the connection seem so obvious, but at the time of starting this NMHD mission, my thoughts were actually pretty simple: "Wouldn't it be nice if I could get out from under this crushing debt? If I could do something else with $1,057 every month?"
The funk I talked about earlier first settled in when I got passed over for the promotion the second time. It got really bad, though, when I realized, after paying down $50k in three months, that I could have spent that money on something fun instead. I attributed my funk to the fact that I wasn't spending the money on fun stuff, but on a piece of paper.
I think that's probably an accurate attribution, but now I would also draw a parallel to my original feeling of being trapped in my job. Before NMHD, I was trapped in my job to maintain my high standard of living and to pay off my loans at a standard rate. Now, with NMHD, I am trapped in my job to maintain a much lower standard of living and to pay off my loans at an accelerated rate. Because failure is not an option for my NMHD mission, I feel even "more forced" to work than I did before, and this is a much more cramped trap than the original one.
Like almost all human beings, I don't like being forced to do things. I want to feel like I have options and am in complete control of my life.
Before I got passed over for my promotion for the second time, I truly enjoyed my job and I truly liked the company where I worked. I like my job now, and I still like the company. I still work my tail off every day. However, I know I'm still in a trap, so there is definitely still a funk, and I'm still not quite feeling it.
I believe that I will be out of the funk and once again feeling it when I have my loans paid off and I have about $10 or $20k in my Screw-You fund. At that point, I won't be trapped. I'll have a walk-away option supported by savings that I can live on for four to eight months if I am ever mistreated again. And because I'll have gotten used to a lower standard of living, I won't require a job that pays a super high salary.
Hear This: I don't want to be considered a disgruntled employee because I'm not. I like what I do and I like where I work. They pay me well and I did eventually get promoted. I don't want the soundbite for NoMoreHarvardDebt to be "disgruntled employee pays off $90k student loan in ten months so he can quit job." I just want some extra security so that I can stick up for myself if I have to.
Some of my friends who work at the same company should have gotten promoted years ago, but they didn't. I can't help but wonder if they themselves are also imprisoned by their own standard of living and student loans, and that's why they've never given the company an ultimatum and demanded a promotion.