In the Beginning There Was Debt: A Journey to Financial Freedom: Part 1

I was thinking about what to call this quarter's meeting and since we kick off the third quarter celebrating our country's independence having "Financial Freedom" in the title seemed inevitable and fitting. Also, when I examine my own financial journey I realize that financial freedom means something different to everyone depending on their stage of life. Growing up I was taught that you have to work hard to have anything but don't expect much. I had two parents that worked hard but had different ideals about money and how to spend it. My Dad grew up in the Great Depression and was very careful about how he spent money, but also didn't trust banks, lines of credit, or taking any financial risks. On the other hand my Mom was at the start of the Baby Boomer generation, she wanted to work outside the home because she was tired of having nothing, so when lenders started sending offers for credit cards and loans my Mom finally felt she found the secret to giving me and my siblings the "American Dream" everyone was sold on back then. It also helped that pretty much everyone she knew was doing the same thing,digging themselves out of poverty using credit, not realizing they were actually putting themselves further in poverty. I got my first consistent job at 14 cleaning houses, so from then on I had the working hard part down. Most of my childhood I grew up in poverty, because of this my goals for financial success were small, I just wanted to make sure all my utilities were paid and I had food. By 18 I felt I had mastered working hard, and now being 18 the credit card offers came and of course by this time as if my Mother was an Ivy League graduate I had legacy status at all "B" loan companies. If you don't understand what a "B" loan company is, it is a company that will loan to basically anyone for the small interest rate of 100-150% of the original loan. Sounds sketchy, right? You would be correct, very sketchy but legal, and also backed by the largest most reputable lenders, the "A" loan companies, part of that "American Dream" thing that my Dad had cautioned me about. Because of my legacy status I was able to rack up debt at 7 loan companies all at once. Yes you read that right, 7 loans companies all at once. As an 18 year old going to college and working as a waitress at the Golden Corral you can only keep up with this so long. The funny thing is I was mostly borrowing to give the money to my other relatives or friends to get them out of financial jams. I did enjoy one vacation to Eureka Springs Arkansas, in which I paid for a giant cabin for all my "friends" (none of which still hang out with me, no hard feelings at all with them but note to my daughter don't pay for "friends" wait to see who is still around at 40 and then pay for the big cabin) to party in. I am convinced that God moves in our lives all the time if we are smart enough to say "yes". The turning point in my financial life came when three things happened. First, one of loan companies I had borrowed money from for my friend to buy new furniture (total necessity) called to collect a payment because he was late making "his" i.e. my payment. I told the guy the situation, I was between jobs and had no money and the friend promised he would pay the payment. The loan officer was probably tired of hearing excuses when he made these calls so he said, "well we have an opening if you want to come down and apply". This guy didn't realize whom he was speaking to, I had the working hard part down. I got my best "Sex and the City" knock off outfit on hoisted my breast up as high as they would go and I was off for my job interview. The thought of working in an office was thrilling. The office was made up of two middle-aged men, I later found out that I only got the job because the way I was dressed. When they pulled my credit they had to cut and paste my original credit score from when I got the loan there to send to corporate to give me the job. I learned several valuable lessons here, men are easily distracted and motivated by a woman's appearance, (even the good ones, I considered Jeff and Kevin in this category, after getting to know them as very dedicated husbands and great co-workers, needless to say my standards are higher now for all men but because of this I am routinely let down) and your credit score matters. The turning point for my financial journey came when I realized we were to put it simply, "ripping people off". There is no better cure to stop your borrowing cycle at these loans companies than to work for one. When you see an elderly lady putting her house up as collateral that is valued at fifty thousand for her adult son to buy a three thousand dollar car you don't have to be a math wiz to realize what we were doing was wrong, this was an everyday occurrence. I paid off all my loans and quit my job. The second turning point came when my bonus Dad (which is an accountant and the youngest of five kids from a poor family) gave me the pivotal advice, " I love your heart kiddo, but you have to get on your feet yourself before helping all your family members. You need to be in a place where you don't loan but give". This advice gave me the freedom to say "no" to my family because I knew one day I would get to say "yes" with no strings attached. At this point I was moving in the right direction, I had gotten out of debt and recently married, Philip and I had just bought our first house by the hair of our chinny chin chins. Now what? The third turning point happened when my dear Friend Ashley gave me a book called, "Debt Proof Living", by Mary Hunt. This book resonated with me. I learned how to write down what I was spending, set a budget, and create a savings for emergencies. This was working and we were getting good at it but we didn't plan for savings fatigue....