In light of my interview with Jeff Rose who blogs at Good Financial Cents (you can check out the interview HERE), I wanted to relive the past a bit more and talk about how my ‘financial peace & debt free’ journey originally got started.
The majority of Americans have to learn the hard way in order for them to change.
We have to hit bottom, and for some of your friends and relatives, what you think is bottom isn’t really low enough for them.
Sure, there are a small percentage of people that have “common sense,” but the majority of us have to learn things on our own. It doesn’t matter how many people tell them what to do, it doesn’t matter how many stories they read, or how many people try to help them…they’re simply hell-bent of living life their own way.
The problem with this reality is that you hope they learn the lesson before they fall off the deep end. Some people never realize how to get out of their predicament, and they lose hope, thus never finding a way out…
…Others however finally get a light to click on and begin changing things.
It often surprises me that a lot of people expect change without actually changing anything.
If you eat out on a consistent basis, you’re probably going to end up with high cholesterol and be over weight. Furthermore, you’ll probably develop type II diabetes and have some form of cancer later in your life.
If you spend money without regard to your income and don’t limit yourself to a budget, then you’re going to be broke.
If you smoke, I’ll go out on a limb and say you’re going to have some form of cancer and die from smoking. I know, ground breaking stuff here…the world can thank me later.
If you hate your job but never do anything to improve, educate, or better yourself, then guess what, you’re always going to work a job you hate and have limited options of what you can do.
It’s that whole reaping what you sow thing.
In my interview with Jeff, he asked me what my ‘AHA!’ moment was. I’ve never really told anybody that story, other than my wife, but it was a tough question to answer and revealed a lot about my life at the time.
You see, I made really good money for a kid my age. But I lived a lifestyle that was destined for one thing: bankruptcy.
I ate out for nearly every meal; I took my friends out and had parties at my house (and I paid for it all) because I was the one “making the big bucks” and no longer in college; I went to every sporting event and sat front row (or in the first 10) at nearly 7 major concerts…all within about an 18-month period of time.
I did what I wanted without regard to how much I was making. I believed I was invincible. What 21-year old kid wouldn’t that was making $60,000/year? Well, those kids with “common sense” of course.
However, I lived a life on the outside that was all glitz-and-glamor when on the inside and underneath there was only chaos.
I had collectors calling me every day. It got so bad that I had to turn off my cell phone when I was at work because it wouldn’t stop ringing.
There was a time, about a year before my ‘aha!’ moment, that I had to call into work because I didn’t have money to fill up my car with gas!
There were days that I had to choose to eat or party and I chose to party. What an idiot.
I got to a point where I had to cash checks at Walmart because my bank account was so far in the red that the check wouldn’t even cover it, and there was a time where I leveraged some of my most precious personal items to get loans from pawn shops to cover gas and food money. Yes, I got all of the items back after paying 5%/month in interest.
I know looking back that I was EXTREMELY dumb, and some will wonder ‘how can a person making that kind of money have financial problems and be scared?’
Well, the truth is that financial behavior is a direct correlation of financial knowledge. If somebody doesn’t know how to manage money then it’s highly likely they don’t know how to turn things around. IF they did they would have just done it in the first place.
They only know the life they’re living and they don’t realize there’s another way.
When I was “broke” I started to become desperate. I looked for any means to keep my head above water. None of them were sensible because I didn’t have the common sense (the financial knowledge) to know what to do!
I had thoughts of running away to the military because I thought collectors couldn’t mess with me
I thought about running away and hiding…maybe living in a tent and even considered moving out of the country.
I thought about filing for bankruptcy; that’s what people do that have a lot of debt, right? Little did I know that the majority of my debt wasn’t bankruptable as they were mostly student loans.
I got so scared from being sued and having all of my chaos being exposed that I even fell victim to a scam where I lost over $400. Yes, just another idiotic thing that broke, desperate, and stupid people do. I only had around $15,000 of debt that was past due, so I searched long and hard to get approved for a personal loan. Well, I got denied by everybody in the country (rightfully so) BUT! I did find a place that would give me a loan funded by private investors as long as I made the first payment up front. It seemed pretty legit…a well-designed website and a 1-800 number to what appeared to be a call center. They even returned all calls until I Western Unioned them the money.
Fear will make you do just about anything, regardless of how crazy and ridiculous it seems. For those people that are broke and desperate, I know you’re just looking for a way out. Any way out…any solution to the nightmare that never seems to go away.
We all have what it takes, it’s just whether or not you’ll willing to make the changes and the sacrifices that are necessary. It’s not easy…
If there is one thing I always forewarn my clients before they sign up for my coaching program is that getting out of debt and winning with money IS HARD! It’s hard, but it’s worth it.
After my ‘AHA!’ moment things changed forever. There was no partying, no eating out, no vacation or concerts. There wasn’t anything.
I ate Totino’s pizzas, Pasta Roni, and Ramen noodles for literally a year and a half. Even on Valentine’s day that year I made my wife (girlfriend at the time) eat Pasta Roni for the 3rd night in a row! She originally asked if we could go out to dinner and when she knew that wasn’t going to happen she asked if we could get a frozen pizza. Unfortunately for her the food budget for the month had been spent. (No, I’m not kidding)
I worked 5 days a week at my full-time job and I worked the weekends, every weekend for over a year, at a gas station.
As I changed what I was doing, things around me actually started to change! Who woulda thunk it!
You see, fear is a funny thing because at the end of the day it’s generally built up because of the unknown.
The lack of really knowing what happens if somebody sues you. Not really knowing how to handle creditors, how to get the mortgage payment caught up, or how to pay all of the bills each month. The fear of actually not knowing if there is a way out!
These fears are very real and can be crippling for some. Emotions are a very powerful part of our being: emotions in general can propel some people to amazing things, but they can push others to the depths of depression.
For those that still have hope of finding a way out, use your fear to help you make the changes that need to be made. Work like a man/woman possessed, be driven and be determined, don’t let anything stand in your way, and fight until you just don’t have anything left.
My fight still isn’t over…I still have some more arss to kick (in the form of debt).
If you’re facing a tough financial situation in your life, or if you’re broke, desperate, and stupid as I was, I’d encourage you to check out a few of these posts and start to get a little edumacated:
The articles are written by personal finance enthusiasts (not certified professionals) based on their personal experience. What works for them may or may not work for you, and you should always consult a financial advisor before making important financial decisions.
In accordance with FTC guidelines, we disclose that we have a financial relationship with companies mentioned in this website. This may include receiving access to free products and services for product and service reviews and giveaways.
Any references to third party products, rates, or websites are subject to change without notice. We do our best to maintain current information, but due to the rapidly changing environment, some information may have changed since it was published. Please do the appropriate research before participating in any third party offers.