You know how it is – hindsight is 20/20. Of course it is! If we knew what the future would hold for us we probably would make different decisions. Unfortunately, that’s not the case. BUT I’m hoping by writing this letter to “my” younger self, it will help those just starting out as adults and parents. The first sentence would be to STOP SPENDING!
I had an amazing childhood. We were always outside playing until the street lights came on, then our butts had to be in the yard. It wasn’t until probably after I graduated from high school that I noticed that I didn’t have as much “stuff” as my friends did. It didn’t matter though because at that time, I was working and able to buy what I needed or “thought” I needed while living at home for the most part rent free.
Once I was in the outside world working, I thought my clothes were not good enough so off to the mall I went. I proceeded to walk into every store there was and ask for a credit card application, fill out those applications, get the credit cards and quickly run them up to the max by shopping weekly. The bills totaled at least $3000. I know that doesn’t sound like much but this was 1980 and I was 18 years old.
My mom stepped in and took control of my checking account and my bills and helped me pay them off. Did that stop me from doing it all over again? No it did not. Married – ran up the bills. Had kids – ran up the bills. It finally took my husband being injured at work for me to stop using shopping as entertainment and get control of my finances. If I were to do it all again, I would realize that I had everything I needed and buying did not fill any holes in our lives but I’ll get back to this in a moment.
Back again to the mid-80’s – my husband and I are recently married and living on our own for the first time in our lives. So far so good but he’s laid off from a job and we’re living on one income. Do we cut back? Nope. We continue going out as if we have 2 incomes. Only when I am pregnant with my daughter do we get our finances under a little under control so we can purchase our house. Luckily for me, I have funds in my 401K that we can borrow against and pay ourselves back. One of my smarter financial moves.
Probably the best financial decision I made was to buy the home that we would live in for 4 years. It was a duplex in the city of Cleveland. We lived in half and rented the other half out which kept our mortgage very manageable. The second best decision would be the keeping the duplex while buying a house next to my in-laws that I already knew would be bought out by the City of Cleveland for airport expansion.
In the meantime, my husband is transferred to Miami and off we go to a whole new life. We rent out both houses in Cleveland and buy a house in Miami. So far so good until the financial storm hits yet again when my husband is injured at work and we go quickly from a 2 income household to a 1 income household. Do you think we learned anything from the first time around? Unfortunately we did it again but this time it was worse because we were using credit cards to maintain a 2 income lifestyle at a higher risk level than earlier in our lives.
So you’re probably wondering what the moral of this story is. There are 2 actually. The first one is ALWAYS pay yourself first so you’re covered in the event of any rainy days. The second is we don’t always need bigger and bigger to be happier. Thinking back now that my daughters are out on their own living happy lives while my husband and I are sharing a big old house with a mortgage on it, I would stay in a small house with a small mortgage. You don’t need bigger – you need to be smarter and focused on a time in the future when your kids leave the nest and you want to enjoy life. It’s easier to do that when you don’t have a mortgage to pay on a house that’s too big for you to live in. The moral is be happy right where you’re at and don’t worry about keeping up with anyone including the Joneses.
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