Reflections: My Journey to Debt Freedom by Saeed Shaikh
Allhumdillah rabiAlameen, wa salatu wa salaam ala sayiddina Muhammed sallahu alaihi wa sala’am. All praises belong to Allah the Lord of Worlds, and we send peace and blessings upon our prophet Muhummad.
I’ve had the fortunate pleasure of meeting and learning from some of the instructors at the Qalam Institute over the past couple of years, and was drawn to a number of their programs that utilize Islam to address challenges facing our Ummah. I came across the Debt Free Muslims program and was instantly drawn to it. I sincerely wish this program had existed even 2 years ago, not to mention 5 years ago to help give me insight into my problems with debt. In my personal life, being in Personal Debt has been one of the greatest struggles I have dealt with. But when Allah aza wa jal chose to remove debt from my life and return me to prosperity, debt became a path to one of the greatest blessings in my life, and led to a deepening of my Iman. Below is a brief telling of how I got into debt, and some of my takeaways from getting out of debt.
So where to begin? Let’s go back to 2003, I was a freshman six weeks into college and amidst the shock and awe of this new phase in my life, the one thing I needed (in reality wanted) was a cell phone. All I really wanted, wanted badly was a cell-phone, so I could keep in contact with my new found friends, feel included and immerse myself more so in my newfound college experience. My parents by nature, and by choice, were not the type to adorn their children with things like cell-phones, laptops, and expensive things. They didn’t have those kinds of resources, and felt we really didn’t needed those things to be successful. So as a result I went through High School without a cell-phone, and without my parents buying me my own computer and such. But now I was in college and I needed a cell phone desperately! As a matter of coincidence, there happened to be a representative on our Campus from Citigroup signing up naïve college kids like myself for credit cards. He didn’t have to say much, before I signed up for a card. All I knew was that this was free, easy money and I could now buy that cell-phone and more possibly. Fortunately I was still living at home with my parents at the time, because it was cheaper for them, as they were paying for my education and my brother’s education at the time, also our house was relatively close to my school. However, I had a mailbox on campus, so when I got my new credit card in the mail, it came there. When I bought my cell phone it came home, however. My parents found out, and my dad immediately took me back to the store to return it, being in a time before cellular policies were super strict, and given that I was returning it the next day, I was able to get a full refund on my credit card.
I always knew credit, and credit cards were not a good thing. I had friends, non-muslim friends too, giving me there take on credit cards, how they wanted to wait until they built up some credit before they got a credit card. All of this went in one ear and out of the other. At this point I had cancelled the credit card, and had a clean slate. But I wanted that phone so bad. So I did it again. I got a credit card, and this time when I got the phone, I made sure to keep it a secret so my parents didn’t find out. I rationalized the whole thing in my mind, by telling myself that it wasn’t a high credit limit, and I had a campus job so I could pay it off eventually, right? Wrong! Over the next four years I amassed several thousands of dollars in credit card debt. I let the debt linger over me because I continually made monthly payments. Allhumdulillah, upon graduation, I was able to go to graduate school and get an advanced degree, which netted me a high-paying job. Also by the mercy of Allah, I was able to stay in my home town, the same town my college was in. So I continued living with my parents. Within a couple of months, I paid off my credit card debt shortly after stating my new job, so that was the end right?
Wrong again! Over the next several years because of my nice-paying job and zero-cost of living I lived a life of luxury, lavishness, extravagance: Phones, computers, skis, vacations, designer everything, and eventually I even moved onto buying pricier things like nice cars. MashaAllah I was a baller!
But I wasn’t! After a couple of years of living like this, I realized I needed to seriously change, I needed to do something. I had a really nice job, but my financial situation was a disaster. I had a lot of money coming in, and all I knew how to do was spend it, spend it, and spend so much I put myself back into debt, except now things were worse off than before.
So one of the things I realized I needed to do, was move, move out of home. So I moved. I traded in my really nice car for a decent set of wheels. The deal hurt, and made little sense to anyone, but it helped reduce my overall debt, and made getting out of debt and building a better financial situation for myself easier. I found a job in a new city, and for the first time I was paying rent, utilities and buying my own groceries. By doing this I had just added some structure to my finances. Before I moved I was able to pay-off large portions of my credit card debt, but I would add that debt back. Paying rent and the associated finances of living on my own forced me to plan out my expenditures.
With some financial stability in my life, and a big blessing from Allah aza wa jal I was able to get to where I am today; the longest amount of time since before college that I have been free from credit debt, freedom from student loans, in a position to own my vehicle in less than a year, and a financial situation where I can settle down into a long term comfortable life.
On the surface it may seem like I just straightened out my financial situation by moving, and the debt slipped away after a couple of years. But the reality was that a lot of behavioral and spiritual changes occurred that allowed for me to get out of debt. These changes are the takeaways from my journey into and out of personal debt that I hope will benefit others inshaAllah!
The first is takeaway is to know your limits, even if you are making a-lot of money, it does not mean you can or should buy things you cannot afford. Allah aza wa jal says in the Surah Al Baqarah, in the beginning of Ayah 143. “We have made you a balanced nation.” In Surah Araf, Ayah 31, Allah aza wa jal says additionally, eat, drink and be not excessive, for Allah does not love the those that waste. When I reflect upon these Ayahs, I realized I had become excessive, wasteful, and not balanced. This was scary not just in terms of my life, here and now, but in terms of how Allah viewed me. Not only was my spending and my debt affecting my physical life, but it also had damaged my relationship with Allah. So I assessed my situation and I made a change to force me into better spending habits, this helped me regain balance in my financial situation, and eliminate my wasteful habits. If you are struggling with personal debt you need to examine your spending habits, and make a change to restore balance. If you can’t make that changes yourself, find some-one you can trust to help you make them, but don’t delay.
The second takeaway is to live frugally. During my rise out of debt I went from buying designer clothes almost every month, to seldom buying clothes, and if I did, they were not designer, functional over fashionable. I went from buying luxury items, to buying the basics like food and gas. From the life of our beloved Prophet ﷺ we have the best example of frugality in living. His residence comprised of a collection of pillows, and a mat! By no means was I able to reduce my living conditions to that of the Prophet ﷺ, but in my quest to be debt free I gave up a good amount of my luxury items, like my car, for example. In your quest to be debt free, you will have to make sacrifices, things will have to last years not months. In addition you will not be able to enjoy the creature comforts you did before, like periodic vacations, those will have to go. Lastly, if credit cards are a problem for you like they were for me, you’ll slowly need to stop relying on using them. Start making payments with a debit card instead for example, shift monthly payments to your bank account or debit card. All of this will hurt, but inshaAllah it’s all for the best in the end.
The third takeaway is to plan your escape from Debt. Itemize the amounts you owe, and prioritize which ones you need to pay-off first. Then, given, your current expenses budget how much you can allocate to paying off this debt first, and then the next debt and so-on until all your debt is gone. This called the debt snowball method. If you’re not sure of how to go about this, or it seems too cumbersome, you may need to do some research or the assistance of financial planner. It may cost you in the short-term but can pay great dividends in the long run. I had gotten started using this method, and it was effective, alhumdulillah!
The fourth and fifth takeaways are to give charity and supplicate Allah desperately for help. Yes, give something, even while you are in debt, even if it’s a really small amount. Allah aza wa jal says in Surah At=Talaq, Ayah 7: “Let the man of means spend according to his means, and the man whose resources are restricted, let him spend according to what Allah has given him, Allah puts no burden on a person beyond what he has given him. After difficulty, Allah will surely grant relief.” Furthermore Allah says in Surah Hadid Verse 11: “Who is he that will lend Allah a beautiful loan? For Allah will increase it Manifold to his credit, and he will have besides a liberal reward.” Lastly from the beginning of Surah At-Talaq in Ayah 3, Allah aza wa jal states: “He provides for him from sources he could never imagine.” I truly believe giving in charity was the key to my freedom from debt. If spending excessively in your own path robs you of Allah’s blessing, surely spending in his way, will restore some of his blessings. I remember during my years in debt giving reluctantly, and holding out due to debt, until I felt guilty, so I just gave something. A short time later, though, a substantial amount of money would un-expectedly appear in my bank account. It was mainly from my dad, sometimes it came from other sources, but it was always unexpected. I would always use this money to reduce my debts. This unexpected money was evidence of these ayahs, of the blessings of Allah. So give inshaAllah.
The biggest of these blessings came at a trying time in my life. In the Months preceding my freedom from debt my supplications to Allah had become more and more serious. I was pleading for freedom from debt! A short time later got laid-off from my job, and as the announcement was being made I was thinking to myself, I’m done. I’ll need to declare bankruptcy or something. But then Allah blessed me greatly, the severance from my job enabled me to pay-off my debts! So in the coming months I was able to be debt free.
I felt that Allah aza wa jal had answered my supplications, and rewarded the changes I had made in my life to rid myself of debt, with ridding me off debt.
I sincerely believe if you take the right steps to rid yourself of debt, if you spend the cause of Allah, change your faulty financial habits and supplicate for His help, these are acts of repentance from past mistakes, and as is related in a Hadith Qudsi on the authority of Abu Hurairah(may Allah be pleased with him) that the Prophet ﷺ said:
“Allah the Almighty said: I am as My servant thinks I am (1). I am with him when he makes mention of Me. If he makes mention of Me to himself, I make mention of him to Myself; and if he makes mention of Me in an assembly, I make mention of him in an assembly better than it. And if he draws near to Me an arm’s length, I draw near to him a cubit, and if he draws near to Me a cubit, I draw near to him a fathom. And if he comes to Me walking, I go to him at speed. (1) Another possible rendering of the Arabic is: “I am as My servant expects Me to be”. The meaning is that forgiveness and acceptance of repentance by the Almighty is subject to His servant truly believing that He is forgiving and merciful. However, not to accompany such belief with right action would be to mock the Almighty. It was related by al-Buhkari (also by Muslim, at-Tirmidhi and Ibn-Majah).”
Lastly Allah aza wa jal says many places within the Quran, He is with those that patiently persevere. Getting out of debt will be hard and long, be patient, and Allah will see you through it, and return you to prosperity inshaAllah!