I had a college friend, Joe, when challenged, used the expression, “Ain’t it a bitch being all grow’d up.” It applied to the majority of dramas we encountered as students. The only thing funnier was Joe borrowing my sunglasses to do his imitation of Stevie Wonder.
Tracking your income (incoming) and your debt/expenses (outgoing) is simple math. A large number of consumers seem to have a problem balancing their budgets. Ah, budget is the magical word. When I was wiping noses, driving car pools and working full-time, I could not have told anyone our annual income. I did not know what our annual income was. I knew how much the electric bill was and there were funds in the checking account to cover everything else. Numbers were only important for big-ticket items or I wanted to go to Disney World. One time, I told my husband I wanted to buy a new television. He said, “We can’t afford it.” No one had ever told me this before! We actually sat down, ran the expense numbers and determined if we did buy the new television, there would be no extras. From that day forward, I know all the magical numbers to continue the life journey in the style for which I am accustomed to! I got the tv, but it was 8 or 9 months later – after I had saved the funds to purchase it.
As a previous banker, I always had one or two customers with an extreme obsession with keeping track of their money. One particular gentleman would be in front of my desk, the day after receiving his statement to inform me that he calculated the interest for his savings account and the bank had shorted him $.03. He laboriously would lament as he provided adding machine tapes, calculator printouts and previous statement comparisons. I was not able to open my desk drawer and throw a nickel at him and tell him to go away. I tried numerous times to pawn him off on one of the accountants but they developed extreme diarrhea if they heard he was in the building. Every time this incident repeated, I would suggest he join an investment group (an opportunity to contradict a different type of audience) or Toastmasters (he certainly enjoyed hearing himself talk). Repeated fixation over a small detail may cause a wall between what is truly important and what may be a time waster.
One of my friends, is the queen of denial when viewing debt, money and budget – a foreign concept to her. She repeatedly tells me she is unable to meet her financial obligations due to a lack of funds. Knowing her annual income and basic expenses, I could save enough to purchase a new car, with cash, if I were her. I was a single parent and financially moved mountains with my bare hands. My children and I witnessed miracles each week at the grocery store check out and racing across town to pay a bill on time before the creditor closed for the day. My friend does not budget. She purchases items with high tickets because she feels entitled. These spending patterns make her feel important. A bottle of extra virgin olive oil with a price tag of $38.00 creates a feeling of superiority. The same can be said for the $1,100.00 shoes and the weekly pedicures. She chooses not to manage and throws billing statements and collection letters into the trash, unopened.
This week, I received a panic call from my friend. She went to use her debit card and it would not work. After contacting her bank, one of her creditors had sued her and a court action had a hold on all of her deposit accounts, including her safe deposit box. When it is every dime you own and your deceased mother’s jewelry at stake – it gets your attention. The original debt was $5,000.00. With legal action fees, compounded interest and the kitchen sink, the total now exceeded $18,000.00. There was a lot of singing and dancing in trying to straighten this mess out. Her paycheck is automatically deposited and there was no time to stop the next check. She didn’t have a dime in her purse or at home. Debt view – non-existent.
The bottom line is – grow up. Yes, it is a bitch, but it is being responsible and mature. Instead of dancing through the mall for entertainment or dining out at restaurants that serve kumquats and es cargo – add your bills up. Pay your bills – on time. Save some money – even if it is $1.00. My mother taught me to never purchase anything on credit that would not exist when the bill arrived. This included candy, pantyhose, hair styles and cosmetics.
It takes sacrifice, ingenuity and time to make ends meet when you are in a tight spot. I have been laid off, divorced, sick and a single parent. It is possible to prepare for emergencies, such as no income! When I was laid off, I was the only unemotional person in the group. I had an emergency fund and read the writing on the wall way before the axe fell. It was the first time in 35 years I didn’t have to answer to “the man”!