Debt confessions of a former priest

Phillip Cioppa was a Roman Catholic priest for 18 years. His starting salary was $8,400/year and when he left in 2001 he was earning $18,000 (after taxes, Social Security and Medicare). To make ends meet, he used a credit card, and found himself in deep debt. He shares his story on

In late 1983, I was so proud to receive my first credit card from a major bank. I got the card, which had a $1,000 credit limit, through the assistance of a friend’s sister, as I clearly did not qualify. I swore I would only use it for extreme necessities. However, soon after getting that first card, I began to receive offers for more and more of them. I thought, what could be the harm of having some additional credit cards? After all, I had no savings and made very little money, so the cards would provide me with a “cushion” in times of need. Unfortunately however, I began to rationalize those “times of need” as a dinner here and there, new clothes, and other “essentials.”

I faithfully paid the minimum due on each card every month and was never late with a payment. In return, I was rewarded with increases in my credit limits. Remember that first credit card with a $1000 limit? It soon had a $10,000 limit. However, I did not have to use that card only because I quickly acquired twelve cards! I was credit card rich.

Ah, but then came judgment day. On the day I informed my Bishop that I was leaving active priestly ministry, I took a close look at my finances and discovered that I had accumulated more than $54,000 in credit card debt! I realized that if I stopped using the cards and paid the minimum on each, I would not be out of debt until I was 92 years of age. However, I wasn’t worried. I told myself that because I was single and had no responsibilities other than taking care of myself, my credit card debt was really not a problem. And so I kept using the cards. Then, two years after I left the priesthood, I fell in love and got married. I now owed a whopping $67,500 in credit card debt and realized I was in serious financial trouble.

Debt confessions of a former priest


    1.  And then he became a banker and financial advisor. I guess he didn’t need math skills there either…

    1. He still makes an income. I kind of suspect that with the free housing and health care the “$18,000” comes out higher on his 1040. He should have gotten a write off for his collars, priest shirts, and pants, so I am not sure what all the new clothes were . . .

      Kind of sounds like he was just a disaster on the financial front.

        1. Except he needs to account for the free housing, clothing allowance, etc. Most people pay 25-30% of income for housing, so it might be reasonable to boost his $18,000 by 25-30% for 1040 purposes. Also, $18,000 is already net, not gross.

          JANDRESE: Sadly, I don’t know either, but I do know it is listed and is part of “total compensation” for taxes. I assume that some version of fair market value as you posit is right, but I have never had to do it. If anyone would like to pay my mortgage for a year, I’ll let everyone know how this works in April.

          1. I’ve never had free rent.  How do you report something like that?  Do you have to work out what the rent in your neighborhood would be for your living space and add it as income? 

      1.  Yep, reported as self-employment income on your regular 1040, taken from Schedule SE, long form. Shit’s complicated!

        1.  Probably also paying the half of payroll taxes that regular employees have covered by their employer.

  1. Happened to me too. Except for the part about being ordained. 

    Credit cards are the devil. And the less money you have, the more enthralling they become.

     They allow people to (temporarily) live the lavish American lifestyle that’s pushed into our faces day after day by marketing culture.

    They grant instant gratification and they delay consequences. And they’re programmed to dig you deeper into debt. They’re the housing-bubble-predatory-lending-banking-scandals writ small.

    Credit cards and credit card debt have caused untold misery in the United States, and our banking regulations continue to allow them to literally con millions of Americans into deep debt.

    So, snark away, unklesteve, better (probably) people than you have been taken in by the credit card con.

    FWIW: I am, rather, I was, debt free for years after taking six years to pay off my modest credit card debt. But I just bought a home. After years of not thinking it was possible, I was able to scrape up enough of a credit score to obtain a mortgage at a reasonable rate through my credit union and buy a modest home.

    I still don’t have a single credit card.

    1. The trap is pretty deviously designed.. because even if you manage to avoid the lure of “(temporarily) free money”, they sock to you in other ways. Major purchases without a credit history will earn you a ton of problems:  you either get dismal interest rates or shown the door. 

      I made it to about age 30 before I finally succumbed because I was tired of salesmen calling me a “ghost”.. and treating me like one.

      1. I had one, one, just after college. I paid that shit off and cut it up. Now I have the cash in hand, and the tastes of a monk.

        I assure you, cash is louder than credit.

    2.  IMHO, unless you are just incapable of controlling yourself (there are a lot of people like this sadly), completely doing away with Credit Cards is the wrong solution. 

      What you need to do instead is simply pay off all of your cards entirely each month.  Not only does this build up a good credit score, but it’s also much more convenient than paying cash for everything. 

      If you find that you are unable to pay off the card for even a single month, then you need to reevaluate and consider dropping some expenses (Cable, fancy internet, expensive coffee, etc…) until you get it paid off.

      Never ever just make a minimum payment.  Always pay off as much as you can, even if it leaves you feeling broke (because you are!).  Don’t be lured by the low “per month” payments, they are just there to make you dig yourself a hole so deep that you’ll never get out.

      1.  This a thousand times.  If you can’t make your full payment for the month, stop using your card immediately.

      2. What you need to do instead is simply pay off all of your cards entirely each month. Not only does this build up a good credit score

        Paying off your cards every month does precisely the opposite of building a good credit score. Because you’re not technically using credit, as the industry perceives it, you’re an outsider and will have a really low score.

        1. That’s not true at all. I pay off my cards in full each month and have a great credit score. On your report is simply “max balance” and “number of times late.” they do not report how long you carry that balance.

          1.  Do you have any other sources of credit? Remember that the score is a measure of how much interest can be made off of you. It’s not for your benefit, or I would have perfect credit for not borrowing money.

          2. The precise formulas for calculating credit scores are closely guarded industry secrets, but paying off your cards each month most certainly does NOT guarantee you a higher credit score than someone who does not. Part of your overall credit score is determined by your credit limit, which is difficult to raise if you never borrow much.

          3. dculberson is right. I have two credit cards that I use for everything, and I pay them in full each month. I haven’t paid any interest on a credit card in over a decade. My credit score is in nosebleed territory, and I have oodles of credit, more than I could ever imagine using. Show you’re a responsible borrower, and banks will lend you money. They make plenty of money from the vendor transaction fees on my ample purchases each month. What doesn’t do you any good is getting a credit card and not using it. You have to show you can use it responsibly. 

          4. @Antinous: My FICO is 785. Let’s just say I have enough plastic to get me into a mid-range Lexus, not that I would want one!

          5. Well, not quite nosebleed territory. When I was completely overextended and paying only minimums, my FICO was in the 800s. I don’t know what it is now that I pay off my AMEX card monthly. I do know that my credit card limits have dropped from about $20K per card to about $15K per card since I’ve become more responsible.

          6. @Antoinus: Likely more a function of the credit crunch than anything. When things went south, the banks recalibrated limits on most overextended borrowers as soon as they paid down their balance a bit. 

        2.  I’ve been paying off my cards every month for years now and my combined score is over 800.  I also have a mortgage that I’ve never missed a payment on but that’s it.  If paying off your card every month is a penalty, it must be an incredibly tiny one. 

  2. “I told myself that because I was single and had no responsibilities other than taking care of myself, my credit card debt was really not a problem.”

    How very Christian of him.

  3. Yep, the minimum payment is a trap.  Psychologically you look at it and go “only $20?  that’s nothing, I can afford that.”  Then you spend more next month and suddenly it is $30 a month, still cheap, and you spend more, and before you know it all of your free income is going towards interest on your debt and you take a look at the total balance and realize just how far away you are from paying it off. 

    IMHO, any month you don’t pay off the cards entirely is a failure.  If you are living month to month then it’s almost inevitable, but at the very least you need to pay as much as you can to prevent the principle from getting too large and overwhelming you.

    I am one of those “deadbeats” that uses his credit card for just about everything (1% back on life) but pays it off every month, and I know I’ve thought to myself a couple of times how small those minimum payments are and how easy it would be to just let a month slide, but when you think about the work you have to do on the other end (a super lean month) to pay off the difference it is just not worth it. 

    1. Even the 1% back thing is a trap though, because most people won’t be able to maintain the discipline. Credit cards can be life savers, but they are so easy to get in trouble with.

      1. Its a trap if you don’t pay off monthly like jandrese (and I) do. It can also be convenience and a little free money every year. That’s different than ‘pay the minimum’ which might be required due to circumstance sometimes but is almost always a horrible idea.

      2. I read a statistic a few months ago that something like 60% of the people with credit cards don’t carry a balance month to month.  I’ve been doing it for 20 years now and I don’t think I’m exceptional, just a bit of a cheapskate. 

        We read a lot of stories about how a person got 50k or 100k in debt with credit cards, and yeah, those people just can’t be trusted with them, but I think more people understand personal finance than we think.  “Boring guy pays off his credit card yet again, lives drama free life.” doesn’t make for a good headline.

        Overall, I think the “Credit cards are the devil!”  rhetoric is overblown and mostly the result of a minority of irresponsible people who are bad at money management but good for human interest stories. 

        It also reinforces and old belief that I have that some people are poor because they’re low skilled (born kind of dumb), some are poor because they’re ill (mentally usually), and others are poor just because they suck at money management. 

        I have one Uncle who has always been trailer trash.  It is sad.  Right now he, his wife, and numerous kids and grandkids live in a shack out in the country with no running water because the pump broke and they can’t afford to fix it.  His wife’s father died and left her a halfway decent chunk of change ($20k or so), and instead of fixing up the house or paying down their debts or putting away money for a rainy day, she immediately took off for Vegas and lost it all and some more.  That’s the kind of person who should not be allowed to have a credit card–luckily her credit and now my Uncles is so terrible that nobody will even consider giving them a card.  It’s a sob story, but it’s also totally self inflicted (they both had decent jobs given their lack of skills) and not something you’ll be able to help without literally imposing yourself on their life and taking over all of their finances.  I live 2500 miles away and have a wife and kid of my own, there’s not a lot I can do for them and at the end of the day they’re both adults and need to be responsible for their own lives.

        1. Being poor is expensive in money, time, and energy. Think of Vimes’s boots or the impact of living without a reliable car on your ability to make fiscally-savvy employment and shopping choices.

          People who grow up poor don’t learn the same money-management lessons that people who grow up with money learn. They are generally surrounded by other poor people who don’t show them any other way to operate.

          People who are poor don’t have a cushion on their own or from their relatives. A financial blow presents only bad options, desperation, and (often) a ratchet down into the next blow. Mistakes make stress and stress makes mistakes.

          I suggest you read Scalzi’s post on being poor and a short Cracked piece on the effects of growing up poor even when you aren’t poor anymore

          1. I had two friends whose parents didn’t give them an allowance to manage. They were the two most financially fucked up people I have ever met (in an enclosed space.)

          2.  @Antinous_Moderator:disqus  On the other hand, I have friends who grew up with an allowance that had a painful young adulthood until they figured out they didn’t actually have money to spend on the fun things until they earned it.

            That said, I do agree that if you didn’t grow up in a family with a lot of money you don’t have the same savvy. Even between ‘middle class’ and ‘well off’ there’s a knowledge gap. Knowledge about how credit cards work and how to save for retirement, let alone about the high-sophistication things like how to invest in individual stocks or other investment vehicles, strategically using debt, taking advantage of tax breaks, etc.

            Speaking from personal experience, I grew up middle class, and have had a lot of advantages. But one advantage I didn’t have was knowledge of finance.  My parents don’t like the topic and though they were economical in the sense of not spending more than they had, they are not that sophisticated in terms of maximizing. No investments outside a 401K mutual fund, no consideration of what options are more or less tax advantaged, etc.. My financial knowledge is still mostly limited to, ‘you should put money into a savings account’ (I’ve learned a little more.)  But I know my similarly educated peers are doing way more sophisticated things. Because they talk about  it. Sometimes it is even something I understand, but it would never come to mind, because it is outside my experience (only rich people buy stocks, right?).

          3. At the very least, deciding whether to spend your weekly dollar on ice cream or save it for a movie on Saturday teaches you that there are choices.

        2. “It also reinforces and old belief that I have that some people are poor because they’re low skilled (born kind of dumb), some are poor because they’re ill (mentally usually), and others are poor just because they suck at money management.”

          And some are poor because they were born poor and started working low-wage jobs at fifteen to help support their families. Others are poor because they made just enough to get by until their car was stolen or they got pneumonia or they lose their job suddenly because their company is shutting down the plant. Your viewpoint is skewed by what appears to be a belief that you are the neutral point: everyone has your resources and your opportunities, but they are too dumb or too lazy or too ignorant to take them. It’s insulting to all of the good people out there who are poor and debt-ridden because of contingency and shitty national policies.

          About your aunt: I’m glad she finally had the chance to experience a good time. It’s a rare chance for people like her.

          1. Sure there are sob stories.  People driven to the poorhouse by medical expenses is another common one.  The difference is that in the long run people who learn how to manage their money eventually rebound, while people who don’t end up being poor forever. 

            The low wage job at 15 guy is a textbook case of being low skilled.  As is the guy who lost the only job he was qualified for (a low skill manufacturing job at the only plant in town). 

            Don’t get me wrong, I think the social safety net is vital and one of the things that makes the country great.  Our treatment of mental health among the poor is really terrible though and robs society of many potentially productive members.  That said, no matter how many opportunities you give some people, they’ll never take any of them because they’re shiftless lazy assholes. 

          2.  This is the problem with our society: success, happiness and security is determined entirely by your money management skills. Not whether you’re a good person, not whether you’re a good mother, not whether you treat your neighbors well, not whether you create beautiful things with your hands, not whether you can make people cry with your music, but whether you have good money management skills.

            This is sad.

          3. @boingboing-d169aba4714e8e2b31778bd1f1fa9cd3:disqus – “That said, no matter how many opportunities you give some people, they’ll never take any of them because they’re shiftless lazy assholes.”

            You should put that on a motivational poster and hang it by your desk.

            You realize the topic of the post is a priest right? CLASSY.

          4. @jandrese Unless you are Warren Buffet or George Soros I expect there are financial blindspots and traps all the way up the fucking ladder.
            Warren Buffet has interesting things to say on class war. He seems to think the traps are created deliberately.

  4. “I took a close look at my finances and discovered that I had accumulated more than $54,000 in credit card debt!”
    Shocking! “I kept spending money on plastic without checking the balances and somehow it accumulated in vast amounts.” Reminds me of a family member of mine who suddenly “discovered” that he had completely drained his retirement account. That kind of discovery requires years of serious willful ignorance.

      1. Both of your posts raise important points for people to keep in mind. However, this guy made it through the seminary and was a parish priest for 18 years. That means he almost certainly had a college diploma, and probably handled funds for the parish. This guy’s story is a double disaster because he is manifestly not the people on the financial edge you are talking about.

        That doesn’t change the validity of your points, but I do think the story in the post is less that and more willfulness.

        1. It’s true that his debt didn’t happen from a financial crisis, but he still wasn’t making significantly above the poverty line of the 1980s, which was $5,600 for a single individual. His free rent definitely gave him an edge, there. However, we have understood that credit card companies have made a habit of misrepresenting themselves for decades.  What bothers me is that the author takes a systemic problem and reduces it to a problem of individuals. You can see that rhetoric being taken up here and spun out to its logical conclusion–i.e., that it comes down to some kind of personal merit. As some of the above comments say, people in debt are “willfully ignorant” or they are “shiftless lazy assholes.”  It takes some serious double-think to forget about all of the intricate decisions between politics and business that have led to our economic decline, and supplant them entirely with the idea that individuals are just doing it wrong.

          In retrospect we all might call our youthful mistakes “willful,” but it doesn’t change the fact that he was born into a credit economy and subject to its conditions. His story is unusual in a lot of ways, though, and I don’t think his experiences reflect the norm. How, pray tell, did he manage to pay off debt that exceeded his income by over eight times his annual salary in just four and a half years? His salary must have seen a dramatic hike when he changed jobs. Since the average income in the late 1980s was around 28,000, I suspect he had outside help. Even consolidated loans collect interest, and 67,500 is a lot debt even by current standards.  Notice that he breezes over how he solved his problem, while still trying to say that with sound financial advice, anyone else could do the same. Whether we evaluate him as an individual causing his problems or solving them, it still leads to the wrong conclusions.

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