A. Go out and buy a new outfit?
B. Go through your finances and see where you can cut back?
C. Open up another credit card because you need more cash flow?
D. Get hammered to drown your sorrows?
Go ahead, be honest. And I'll be honest with you, just out of college I would have chosen options A and D. When I was married in my late 20s, early 30s I would have chosen option C (although I had a feeling it wasn't right but I bowed to spousal pressure). And I have to admit, although A and C are still looking good, I've learned that option B is the best. (damn you, common sense!)
I learned out of neccessity and maturity, of course. I've had times in my life where new expenses come into play (braces, new roof) or you're selling real estate and things are slow, your income goes down, and I had no choice but to cut back. And yes, I even had to cut back on nightlife, ugh. But it's funny how people don't want to drink alone, you still go out with your friends and you say, "No, I'm not drinking, trying to save money", it almost becomes a personal mission then for them to get you drunk. Cheers!
I digress...
However, there were times when my income was cut in half, for instance after my ex suddenly stopped paying child support. It then becomes a situation of, you have for example $2,000 in monthly expenses and your income is now $1,000... at that point dropping HBO and saving $20 a month isn't gonna' do squat. Although, it's still a good idea to look at those things for the long run, the little things do add up, but at that point you need to make major changes like changing your living situation and getting gov't aid. Yes, folks that's a situation it's designed for, not a way of life, but a safety net for when you need short term help. But this is all needs to be another blog. I'll get to that next time.
My point is... when the going gets rough, tighten up, don't go get your hair did and take a trip to Aruba. I know it may be a natural reaction (fight or flight, right?) to want to run away and indulge yourself and ignore it. (hey, haven't I mentioned that self indulgent thing before? I see a pattern.) I can't tell you how many times I've been somewhere and someone is telling me all of their financial problems, like they are going to have to refinance their mortgage because they are two months behind, but in the same breath are telling me about their upcoming trip to Hilton Head. Uh, what's wrong with this picture? They may think they deserve it because of all their troubles, but it's just adding new ones... and it's making them look like an idiot.
There, I said it! Yes, I said it, other people judge you. Gasp! Normally that wouldn't really matter, but if, you having to stop and think "What Would Other People Think?", will help you not do something stupid, like spending a fortune on something unneccessary, when you just blabbed about your financial troubles, then so be it. Stop spending money you don't have! It's really that simple. Keep a record of income and expenses, keep accurate track. Get rid of the credit cards, or keep them out of your wallet. Sorry, it might screw up the economy a little more but it will keep a roof over your head and save your sanity. You can do it!
Madge, sometimes your posts are so timely and strike a chord. This past weekend, for a lot of reasons, I divested myself of my second job. But, that certainly made my budget squeak. I sat down, listed income, listed basics and made a budget, cutting & slashing expenses as I went along. But the extra credit card thing and a good drunk really still appeal. Just sayin'.
ReplyDeleteI'm so glad, I'm timely for you. :) You'll be ok, half the battle is looking at that budget. But I know what you're saying about gettin' your drunk on. Oh hey, that's what "Discount Liquor Barn" is for. ;) (just kiddin' kids!)
ReplyDelete*grabs GPS, programs in "Discount Liquor Barn"*
DeleteI see people do crazy, irresponsible things all the time...and I think when we're younger we do them because we don't know better. We have to learn to manage our finances. I had the problem you're describing and I tightened up but I also started doing freelance writing work and was able to make money that way. I have co-workers who, no lie, HAVE to have a new car even though they don't have an extra dime. They just finance it and, since they can't afford the $400 a month car payment, go into credit card debt deeper and deeper... I bought an old car, drove it 'til it was paid off, then took the money I was paying toward a car payment and put it in the bank and saved for my next car. And so on... It's not easy but one of the reasons so many people are so poor these days is INTEREST. They're buying a brand new car and paying this outrageous amount to a bank for the next five years until their car breaks down and they can't afford to repair it, so they trade it in on a new car that they're paying interest on...and the cycle goes on and on and on. I know that's not the situation you're referring to exactly, but it's that mentality. Every day I hear, "I don't have any money" from these guys and then they get a little money from their taxes and do they use it to pay off debt? Nope. They buy a new TV. Or laptop. Or iPhone...
ReplyDeleteOh, I should have mentioned that, that's my other beef, you're in deep debt and you use your tax refund to go on a vacation! Ugh! Every year mine goes to pay off something or catch up. I haven't been on vacation in 20 years! However this year a portion of my refund will be going to new tires, I don't think mine would pass state inspection, yikes.
ReplyDeleteI grew up pretty poor so this was how I thought all people lived.
ReplyDeleteMy wife could have used this advice after college, but she grew up in a 1%ter family.