Life After Debt

Geez, it's been an entire week since my last post. I never intend for so much time to pass in-between posts. My weeks are running together so much that sometimes when I say yesterday, I really mean last week. When will it slow down? Hmph.

Okay, life after debt.

So, last week I was chatting with some friends/co-workers. During our conversation one of them mentioned something about it being payday. Lifting my head and raising my eyebrows, I said "payday? when, today?" What do you know, it was payday and I didn't even realize it. What a blessing that I can go almost the entire day and not even realize that my wages have been paid. Honestly, since I paid off all of consumer, car and student loan debts, life after debt has been kind of ... uh ... boring. My finances are pretty much on auto pilot. I don't even balance my checkbook anymore. The same expenses go out every month at the same time, not much changes from month to month.

When I was in the trenches of paying off debt there was always something exciting on the horizon. It seemed like every couple of months brought about a new accomplishment - the Visa, the MasterCard, the store credit card, the car loan, the student loan, the 1 month e-fund, the 3 month e-fund, the 6 month e-fund, etc. Now that I've done all of that, it takes much longer to get to an accomplishment. The next item on my list is to pay off the mortgage. If my aggressive target is met, I'll do so in 3 years. If I get close, 5 years, and worst case 7 - 10 years. Trust me, I'm not whining or complaining at all. I'm very thankful for what I've learned and how I was able to apply it to my life. It's just that I spent so much time getting out of debt that now I'm kind of bored, I need some new goals, a new focus. Does that make any sense at all? Although I've never been in this situation I think it's probably similar to what some parents feel when they initially become empty nesters. You put all of your energy and time into something (i.e. the kids) and now that they're gone, you have to reinvent or rediscover who you are and what you want to do.

Some of the things I thought I wanted to do when I no longer had debt, I don't want to do anymore. Funny how much I wanted certain things when I couldn't afford them and now that I can I have no desire to obtain them. So that I don't mislead you, I do have some things that I'm working towards (i.e, basically switching careers) so I'm not totally without any focus. However, it's not the same. I'm goal oriented by nature so it's only a matter of time before I come up with something. Maybe I should train for a 1/2 marathon. Naa, it's too hot in G.A. right now! Okay, I'll find something. Any suggestions?

Gift Giving Rules, What Are they?

This post has more questions than content. I'm sincerely seeking some answers here.

1. What are the rules on giving gifts when you've been invited to an event but are unable to attend?

• Weddings


• Bridal Showers


• Graduations


• Baby Showers


• Birthday Parties


• Baptisms

Are you expected to send a gift at all times?

2. What are the rules on baby showers for the same parents? For example, you are are invited (over the years of course) to several baby showers born to the same parents.

3. If you're invited to multiple bridal showers because you and the bride share multiple circles of friends, are you expected to give a gift each time?

In case you're wondering why all the questions, they're basically because I'm curious to hear what others think. I wonder if I'm too giving or not giving enough.

Cars

My facebook activity has increased quite a bit lately. The other day one of my high school friends posted the results of a facebook application thingy that showed all the cars she's owned. If you are a facebooker, you know how those things work ... someone takes a "quiz/test" and post their results - you then have an opportunity to do the same. Well I began to take this little quiz thingy and realized that I've only owned 2 cars in my lifetime! Wow, I'm in my early 30's and I've only owned 2 cars, well 3 if you count the one my mother let me drive in high school.

During my senior year in high school, I worked and saved money to buy a car ... a Toyota Tercel. I paid the down payment (20%) and paid for insurance; my mother paid the car note. I kept that car until I decided that I'd "outgrown it." At that time I had a job where my clients were fortune 500 companies for the most part. It was nothing to have clients in my car daily. My little car wasn't quite "fitting" any more so I gave it to a friend and bought another one. My second car was a used 1998 Honda Accord, which I still have today. The car has almost 200K miles on it but it runs very good. I still drive it when I go out of town, it's still very reliable, and I still like it.

Me only having 2 cars is not because of financial disciple, it's because I'm too stubborn to compromise. Honestly, I would love to purchase another car, however, until I can purchase what I want, I'm in no hurry to do so. If something happens to my car, I'll just find something decent that I can pay for in cash and keep it moving. Now let's pretend money was no option ... I'd purchase a pearl black Range Rover. Yep, that's the car that I absolutely love. Who knows, next year it could be something else, but for the past 5 years, it's been the Range baby!

How many cars have you owned?

FICO Frustration

At what point should a person's FICO score take a back seat? In my line of work I cannot tell you how often I hear someone say "I don't want to ruin my credit." Okay, I get it. But listen Mr. & Mrs. keep my credit perfect no matter the cost, your electricity has been disconnected. Credit scores have their place but they are not to be worshipped (I personally don't care about it that much, but that's just me). You know you need to dethrone King FICO when you ...

1. Allow your car insurance to lapse because you used the money to pay credit cards.
2. Illegally connect to your neighbor's electricity because yours has been disconnected.
3. Go to restaurants, eat, then plant something in your food so that you won't have to pay for the meal.
4. Sell the title to your vehicle, the only one you have to get back and forth to work.
5. Pawn your wedding rings

...And for what, so that you can pay the creditors and not have a late payment on your credit report.

Even though I don't manage my credit score like a pit bull, I do review my credit report at least annually. Having been a victim of identity theft, I understand the importance of knowing what's on my report. It saddens me to know that people are so caught up in protecting their credit score that they'll prioritize paying creditors over the necessities of life ... such as utilities and insurance. Trust me, I do get the importance of a healthy credit score, but when is enough enough?

***p.s ... I didn't make any of those examples up; they are all real life situations.

Crap Or Get Off The Pot

There are those moments in life when you ask yourself, "if not now, when." You know, the times when you look in the mirror and say "crap or get off the pot." I'm there. Smack, dab in the middle.

There are several things that I would love to put my all into right now. Each time I prepared to do so, I discovered another reason (or excuse) to put them on hold. Initially my goal was to "retire" from corporate at the end of 2007 but when I looked at the balance of my liberation fund, I didn't think I had enough. There were several unexpected expenses in 2007 that put a hurting on my liberation fund - plumbing, necessary home repairs, etc, and with that, my desire of 12/31/2007 came and went.

After 2007 did not work out, my target date changed to 12/31/2008 but then the recession happened. The liberation fund was decent, but suddenly in the face of a recession it didn't seem adequate. Seriously, who ups and quits a decent paying job to go and pursue the unknown? Tons of people right, yes, but in a recession? In a single income household? In an unstable market? I began to question my ability to rejoin the corporate workforce should things not materialize as I have planned. There was a time that anyone with my credentials could get a job, easily, no problems, now not so much. I've scanned the available positions in my area and I know that they are offering less than they were just 2 years ago. Not only is the pay less, there are fewer positions. So, what's a girl to do. I say this girl needs to crap or get off the pot.

New goal and new plan, 1/31/2010 at the latest. Hopefully sooner, but if not, that's the date. I have to do it. I have to try, I have to go for it. Prayerfully in 8 months I will be able to "retire" from my first career and move on to the next.

Has the recession caused you to rethink or postpone some of your goals?

***The liberation fund is not the emergency fund. I wouldn't call deciding to leave my job a valid reason to dip into the emergency fund. Emergencies are things I cannot control; leaving my job is completely in my control at this moment. The liberation fund is a separate account where I'm saving money to help bridge the gap and buy some time when there is no longer a steady paycheck from the job.

I Don't Get It (pt 2)

I promised that I'd share the inspiration for last week's post so here goes, true story:

Amy: I really need to talk to you, I need some help.

Me: Sure, what's going on?

Amy: We're facing foreclosure if something doesn't happen soon. We're 3 months behind on our mortgage.

Me: Oh no, what happened? Did one of you lose your job?

Amy: No, we just got behind.

Me: But I don't understand, yall make a pretty decent income. What happened?

Amy: Well, we just did some stupid things. We knew better, I have no idea why we did it, we just didn't do the right thing.

Me: Okay, we've all done stupid things, but I still don't understand. What happened?

Amy: I'm telling you, we did some stuuu-pid things. We owe the IRS for back taxes and we've been trying to get that straight for several months. I know you don't know this - we filed bankruptcy last year, but we kept the house.

Me: So why is the home in foreclosure. I'm very confused now. You have a decent income and all of your debt except for the house and the IRS was discharged. You really have to tell me what happened because I'm not getting it.

Amy: Well, see, our daughter got married in September and we had to pay for the wedding.

*****crickets******

Amy: We paid cash for it (the inflections in her voice suggested that she was quite proud of the fact that they paid for the wedding in cash, despite the fact that the mortgage went unpaid.)

****crickets*******

Amy: And then Christmas came around a few months later and we had to pay for that as well.

****crickets*******

Amy: So see, we just did some dumb stuff. We're trying to get out of this hole.

Me: Well what is it that I can do for you? You know what to do, why you didn't do it is beyond my understanding.

Amy: Yeah, you're right. We were just stupid.

****crickets********

And again I say, I don't get it! I know this is pretty extreme but I promise you that it's a true story. Just crazy. And yes, this person knows better. Is it possible to know something and never act on that knowing? Is it possible to know something and constantly do the opposite. Maybe it's just me but I think actions demonstrate what you really know. Perhaps she doesn't know as much as she says. She says all the right things, but gosh doggit, did you read the decisions she and her husband have made recently? I don't get it! (sighing).

***Amy is not the person's real name so if there is an Amy reading this, chances are that I am not talking about you:-).

I Don't Get It

Someone please help me understand the psychology of money. Please help me understand why some people (those who "know" better) use credit to purchase things they could have paid for with cash - when I say credit, I don't mean use credit and pay it in full when it's due, I mean use credit and make payments? Please help me understand how paying 18% or more a month in interest payments while earning less than 3% of interest in a savings account makes sense. And while you're enlightening me on that, please don't forget to share with me how purchasing nonessential depreciating items on credit makes sense when you have other outstanding debt - i.e, balances on credit cards that you cannot account for. Yes, I need a tutorial, I need some understanding.

Now before anyone thinks that I'm being snooty or "forgetting" where I came from, please understand that I have done almost every dumb thing you can do with money. I've gone into debt for some of the most ridiculous reasons ... BUT ... that was before I had any knowledge or understanding about money. Once I learned how to handle my finances, I didn't look back, not once. I continued to make mistakes until I learned - with each book I read, each CD I listed to, each website I perused, I made better decisions. So no, I'm not talking about those who honestly may not know better, I'm talking about those who can talk personal finance with the best of them. I'm talking about those who openly profess and proclaim their pursuit towards financial independence one minute but then justify their ridiculous spending with one made up excuse after another the next minute. News flash, you can always conjure up a reason to spend, that's not hard. Heck, 15 reasons just ran through my mind for spending some of my savings.

It seems as if frugality is the latest vogue; it's a movement, it's in, it's hot, it's even sexy. I guess everyone wants to be in but not everyone wants to pay the price. If you're not ready to pay the price, then don't pretend, just be honest, if not with others, then at least be honest with yourself - that's what matters most.

One day soon I'm going to write about the inspiration for this post, but before I do, I want to know if I'm missing something - so someone please help!