I was recently a guest on the Masters of Money podcast. One of the statements Phil made was “Wait a minute. How does one go from declaring bankruptcy to paying $22,000 cash for a car?”
I had never really looked at my journey in that way. But, when I thought about it, I realized – “Dang! That really is pretty awesome.” And, what is even more interesting is how my bankruptcy was the catalyst for bringing me to the place I am today.
WHERE IT ALL BEGAN
When I was in my 20s, I was in a relationship. To be totally honest, it was destined to fail. We were just really too different and so it was never going to work out. However, being young, naive and in love, I was doing all I could to make it work.
For me, that meant buying things to make him happy. But, truth be told, I was really spending money to make myself happy. I loved money because it made me feel good. I adored all it offered to me.
Sadly (and like so many others), it lead me down the path of financial ruin. Well, not the money itself. My attitude did.
I had such an adoration of money, and what I thought it was doing for me, that I misused it. I allowed it to take control of my life to try to fill some of the emptiness I was experiencing.
In December 2001, that relationship came to an end. When it happened, I was devastated. It was a mix of sadness because it was over but honestly, more fear of me being able to support myself alone financially.
I had built up a lot of debt with him. While it was joint debt, we were not married. We both knew that we could not make ends meet alone and that we also needed to find a way to put this all behind us. So, bankruptcy it was.
That following August, we met in Wichita, Kansas before the bankruptcy judge and it became official. I was bankrupt.
REBOUNDING FROM BANKRUPTCY
Fortunately for me, a few months after that relationship ended, I had moved to a new city and met the man I would eventually marry. In fact, he proposed to me just a week after I declared bankruptcy. Talk about a keeper! ?
When I met my husband, I learned a lot about myself and what real love was like. I began to understand that it wasn’t in the things I gave him or he to me, but in the moments we shared. For the first time in my life, I experienced true love and joy.
He was the change I needed.
We married in June 2003 and knew that we wanted to start our family as soon as possible. One thing we both agreed upon was that we wanted for me to quit my job and stay home with our children. It was important for both of us that one of us was there to raise them. We knew it would be a financial challenge, but one we felt we could overcome together.
In September 2004, our first daughter was born. That was the same day I officially quit my job.
HERE COMES THE DEBT (AGAIN)
Once I was staying home with our little girl, our finances changed. They had to. We could not spend as much money dining out and in other ways as we once did. We both knew that. However, we also had purchased a new home and there were things we
A few months before she was born, my husband purchased a pickup. One month after Emma arrived, we went out and bought a brand new minivan.
Between the vehicles and a home equity loan to buy things for our house, we had accumulated quite a bit of debt. We just kept juggling the bills and trying to balance it all – and not very successfully.
I started working part-time from home a few hours a week. That meant I was able to be here to take care of my baby, and was also able to bring in a little bit of cash. It was difficult to do, but I knew we needed the money, so I kept at it.
Our son followed in March 2007. There was no way I could still try to work the hours they needed for me to, and raise two kids. My kids mattered more.
So, I quit.
We continued getting by. There were times when we robbed Peter to pay Paul. We were making it, but not in the way we wanted to.
Then, one evening, my husband told me to go out to dinner with my friends. Little did I know what would happen next.
THE DINNER THAT CHANGED IT ALL
After an evening of dinner and drinks with my girl friends, it was time to pay. Most of us pulled out a credit or debit card to pay. However, my son’s Godmother, Kathy, reached into her purse and pulled out an envelope.
I asked her what that was about, as I’d never seen such a thing before. She explained how they were using cash for everything instead of plastic because they were trying to get out of debt.
That intrigued me, so I asked her more questions. She told me how she and her husband had recently started to follow Dave Ramsey. They were able to create a budget and a plan that was helping dig them out of debt. She filled us in on some of the program and what they were doing. That left me wanting to learn more.
When I walked through the door that evening, I sat down and started sharing all of this with my husband. We knew that our friends did not make much more than we did, so we thought “if they can do it – so can we.”
I grabbed my computer and we started researching this Dave Ramsey. We had no clue who he was or what he taught. The more we read, the more we were inspired to follow his plan. We pulled out the debit card and made our purchase. Nope. We didn’t even sleep on it.
HOW WE CREATED OUR DEBT FREE PLAN
Once the Dave Ramsey books and materials arrived in the mail, we were like two kids on Christmas morning. We tore open the box and could not wait until our kids were in bed that night…..so we could read!!!
Within the week, we had started our plan. Luckily, we had around $2,000 in the bank, so our emergency fund was already taken care of. We created a budget and a debt snowball plan and were ready to attack.
I was looking at the numbers and our plan and it hit me. I was in debt again. However, this time, I felt as if I had brought my husband along with me. I felt horrible that I was back in this situation.
Yes, this time around the spending was not for the same reasons as before, but it had happened. Were we going to get out of debt and just do this all over again in a few years? Why would it be different this time? Did I really learn from my past mistakes?
I started giving this a lot of thought and realized that even though the bankruptcy was behind me, my money attitude was still the same.
MY (MUCH NEEDED) ATTITUDE CHANGE
When I looked at the money we had spent, I realized that it was because I enjoyed spending it. It wasn’t because I was trying to replace an emptiness in my life. Heck! I was happier than I had been my entire life. But yet, here I was, still building debt, buying things I did not really need.
I had to do a lot of self-analysis. It began with me asking myself one simple question:
“What do you feel when you think about money?”
For me, it was simple. I loved it. I loved how I could use it to get things I wanted. And, not having had much money growing up, I thought I worked hard for this, so I will spend it as see fit.
When I said that out loud to myself, I knew it was not healthy. Money is not here just to get the things I want. Sure, it is fun to buy items, but those things were never making me happy. My husband and children were doing that for me.
I took another look at the debt and knew that the money had purchased things. Those things were replaceable and if I lost them all tomorrow, I’d be OK. However, my family wasn’t. There was nothing in this world that could or would ever replace them. Ever.
In that moment I made the decision that I was no longer going to love money. I was going to love my family – and myself – more.
For me, it meant changing my entire attitude. Once that happened, it all started to fall into place.
THE PLAN WE USED – THAT WORKED!
As I mentioned above, we read the Dave Ramsey plan. While we followed most of what he said, we also had to do some of our own research and come up with our own ways to do things.
For my husband, it meant selling some of the guns he owns (he is an avid hunter). I sold furniture and other items that were taking up space in the basement. We had garage sales. Any money we made from these ventures went to our debt.
I started researching and finding ways to save more money at the grocery store. And, as a result of my findings, some of my on-line friends encouraged me to start a blog. (And, we all know where that lead now, don’t we. ? ).
Through it all, we did it.
On February 10, 2010, we made the final payment on our mini van. We had done it. We had become debt free.
THE CASH CAR
Once we were out of debt, we were able to start saving money. It felt amazing to be able to keep more of what we earned and not have to hand it over to everyone else.
My husband and I knew that we would eventually need to replace our mini van. We started paying ourselves monthly payments – instead of a car company. We built up that savings for many, many years.
When we had enough built up to pay cash for a car, we did not do it. Even though we had the money to pay for it, we did not really need a new car. That was a want.
So, we saved even more and researched and waited until the right car came along. And, it did. More than 2 years after we had enough money to pay for the car we wanted, we made the purchase.
There is nothing like sitting down at the dealership and writing a check for a vehicle. There is no worry about how to fit the payment into our budget. The car is ours. We were able to drive it home and just enjoy it.
The hard work had paid off.
YOU CAN TO IT TOO – I PROMISE
During our journey, I found my calling. It was to help others, just like you, do the same thing we did. This blog is how I do that.
I have shared many stories, tips and ideas to help you and your family save money over the years. I know some of you have been able to follow my articles and get started on your own debt free journey.
However, reading a few articles here and there can be difficult to follow. My husband and I did that ourselves. Yes, it worked for us, but we both kept wishing we could follow a plan that would not just give us a few tools on how to do things, but really be there.
Someone who would hold our hand when we were scared. That we would have others to lean for advice. We wished that we could celebrate our victories with others who really understood and can relate.
That led me to where I am today. This blog. This chance to really help others. And, in those continuing efforts, The Financial Reboot Course was born.
CHANGE YOUR ATTITUDE – CHANGE YOUR LIFE
For me, the one change I needed to make was my money attitude. I did not do that the first time around and I ended up making some of the same mistakes. History was repeating itself.
Once you can do the same thing, and really understand the root of how you feel about money, then – and only then – can you start to overhaul your finances. If you don’t change the way you handle money, you will be destined to make the same mistakes over and over again.
I want to guide you on your own financial journey. I want you to be successful. I want you to be able to shout it from the rooftops — I’M DEBT FREE!!!!
Let me help you make the change you need at this moment in your life. Kick start your own Financial Reboot, and leave the past in the past.