"old enough to know better"
Welcome to Season 1 of The Money Fix! With the help of top national money experts, nine DW readers will tackle real-life money problems, and blog about their progress—right here, in real time.
So here I am, nearly five months after joining DailyWorth's Money Fix, and I’m finally making progress on my massive debt and—even more important—I’m changing the way I live my life. And spend my money (which has been the hardest part).
If you had asked me last fall how long I thought this process would take, I’m not sure what I would have said. Back then, I’m not sure I really believed things could change. But working with my Money Fix coach, therapist Amanda Clayman, has given me a new and different sense of control over my money.
Just the fact that I am thinking about how I spend my “disposable” income, and know the exact amount of my debt and monthly expenses, is huge.
I had control in some ways. I was never going to overspend on shampoos or at Target. But I rarely said no to social events (going out to eat, concerts, plays, etc.). And, when the credit was still on the card, I could always find another pair of black boots, a better pair of black pants, a softer cashmere sweater.
And I have bought more than one $8 “artesian” loaf of bread in my life, rationalizing “It’s made from organic ingredients and it’s local.”
And bargains. As mentioned in my second post, it’s really hard for me to walk away from something I love when I perceive it to be a really good deal.
I realized that a lot of this probably sounds really stupid and/or spoiled, like those girls on VH-1s You’re Cut Off!, who stomp around when they can’t use their parent’s credit cards. But as I’ve learned, you can’t change your spending habits until you’re brutally honest with yourself about what they are.
Then you can start to cope. In November, Amanda told me to think of things I could do if I found myself in a store and really wanted to buy something, but couldn’t.
What could I do to distract myself or calm myself down, so that I could walk away?
I thought to myself, “Well that will never happen!” Because, if I saw something I really wanted, why would I walk away? Even if I didn’t have the money then, there was hold and layaway (keep hope alive!)
But, the whole idea of walking away from what could be my next favorite (fill in the blank) made pause a little bit. Instead of thinking, “This is cute and I have enough money in my account...”, I started asking myself, “Can you really not live without this?” I even went a step further and thought about all of the future care the item would require:
“Yes, these pants are cute, but do I really want to have to go to the tailor and get them hemmed? And then all the dry cleaning? I bet I can find something even better to spend this money on...”
Just by questioning myself in my own head, I have totally changed how I shop.
Going out has been another big expense for me in the past. And, while it’s a luxury, I really like doing things with other members of the tribe. But I do not need to go out for dinner and drinks at Boston restaurants, where after tax and tip, dinner can cost $50 – $100.
Instead, I have explained my situation to my close friends, and we’ve been able to find things to do that are a lot less costly. (And how much do I love Groupons?) Just coming out of the debtor’s closet thanks to the Money Fix, and sharing it with friends (most of whom had no idea of my debt), has helped me to set realistic limits as to what I can afford to do.
And here’s the big financial news. Currently, I am in the middle of refinancing my apartment. The new rate is so much lower, and I have enough equity, that I will be able to pay off all of my credit cards. And my mortgage will increase by less than $200. Given that $200 represents about a quarter of what I now pay each month in interest alone, well…math is hard, but even I can figure out that this will mean I will save a lot of money.
The new challenge will be to not run up credit card debt all over again. As Amanda has observed, in the past I have been seduced in the moment by the clothes, the shoes, the antiques. Instead of focusing on immediate gratification in the present, I need to think ahead to the far-more-gratifying future—to feel satisfied by the thought of not having all those credit card bills to pay, and knowing that I will have more choices about how to use my money when I am not paying hundreds in interest charges each month.
I doubt I will ever be the poster child for Sinead O’Connor’s I Do Not Want What I Have Not Got album unless, perhaps, like Sinead herself, I someday own a castle. But the important thing is that I am thinking, and behaving, differently—and instead of owing, soon my money will be growing.
Let loose. When do you feel your worst self is running the show?