25 July 2006

Getting Off the Hamster Wheel of Debt

Well, as it's pouring down rain here this morning and the absolute last thing I want to do is go work (my bed keeps calling me back, stupid bugger), it took me some extra time to get motivated this morning to actually get out of bed. Those of you that know me in person know that I'm not an 'early riser', not a 'morning person', hell not even 'on time' person...and generally I haven't needed a lot of sleep in years past. I can blame this on a variety of factors, but a lot comes from having either too many jobs at once (I once did 3 while attending college full-time), or having extremely out-of-synch sleeping hours (welcome to the world of emergency medicine, where even a good day can beat you down emotionally and cause insomnia). What used to do me quite well was about four hours on night on average, now I think I'm closer to five. By the time I retire (if I retire), I'm hoping I've worked myself up to about eight hours a night. Right now, admiring the parking lot puddles being created in earnest outside my window, I'm really glad I don't live in a remote jungle village in SE Asia or someplace really prone to rain...the rain does make me want to sleep. But, alas, there is work to be done and theoretically money to be transferred to me next week as a result.

Actually, the 'money transfer' thing is starting to have some light at the end of the tunnel. One of my '27 things' (see sidebar to the right) is to become debt-free in 5 years. Now, for some of you, that probably doesn't like much of an accomplishment. For others, like myself, it seems like a good goal...and a goal that has been long overdue. After taking on some debt from ill relatives and also having some medical bills myself which put me under for an extended period for a time, I am finally getting some paid off and this year, even. (Gotta keep praying for the US citizens that national health gets implemented sometime soon...I wouldn't wish my experience upon my worst enemy.) And, I have to admit, I fettered away a good number of years in my 20s just in denial about my debt before I got ill to begin with. The payday was always 'later'. Well, 'later' is now, but now at my own choosing and not someone else's, thank Lord.

So this year is the get off the treadmill year with the bills. If I don't need it (actually need it, not just want it...big difference), I don't buy it. I found out last year (before my most recent trip to Oz) that places like Target® and Wal-Mart® are actually harmful to my goals. Yes, they have my needs in stock, but they've also got like 15 million other wants...and my resistance only goes so far. So what should have been $20 trips to the store became $60 ones and I never could fully grasp what happened, why I couldn't go in and just buy the absolute necessities. Sadly, this 'a ha' realization about my debt didn't it hit me until I was in the returns line one night and a woman was in front of me, returning some new fishing items he husband had bought on impulse. She was crying and obviously upset. She said although she wanted her husband to have 'his' things, he had been spending too much lately and it had come down to keeping the new tackle or keeping the electricity on. Essentially, she was returning things because the family couldn't afford them to begin with. And somewhere...somewhere...in thinking about her situation on the way home that night, I realized I wasn't that far removed. And that actions needed to take place. Immediately.

If I needed any further backup on this, the trip to Oz cemented the deal. While I am sure they are slowly infiltrating the suburbs and even the much-hated Wal-Mart® has made it to their shores in the form of a "Big W®", the mammoth superstores we have here every 20 miles or so are not there...yet. [Edited 8/4/06: Actually Wal-Mart®'s whole advertising design, marketing plan, and store layout has just been copied ruthlessly by Big W®, which I have since found out is owned by Woolworth's®. Sorry for the error in fact checking, folks.] With any luck (and this is not meant to disparage our good Aussie friends), they won't be, either. Instead you go to the Woolies® or Coles® and you buy what you need from what they have available. Even in Sydney (arguably the commercial variety jewel of Oz), they do not offer entire aisles of nothing but cookies (biscuits) or crackers, but just a few shelves on one aisle instead. They have maybe 5 brands total of ranch salad dressing, not 20 and certainly not further divided into 10 more sub-categories. A lot of people go and 'do the European thing' in Sydney and go to several shops when buying their necessities, and there are still countless Mum and Pop stores everywhere there. (You can actually go to bustling areas of Sydney and not see a chain restaurant or store for several blocks...you occasionally have to search them out even. I can't even get that here in my hometown and we're less 1% of Sydney's population.) And, amazing as it may seem to us Yanks, they live quite blissfully in their shopping ways. Even when one checks out you can tell the difference: the Aussies are relatively clutter-free at their entrances and exits to aid in snappy shopping on the way to the beach or neighbourhood barbies; Yanks are instead bludgeoned upon entry with greeters and oversize everything doo-dads, all in the hopes of keeping us trapped inside...and spending money...longer.

So, quoting Steve Earle from his song "Copperhead Road" here..."I came back with a brand new plan." But while Earle's hero John Lee Pettimore came back from his second tour in 'Nam to grow illegal leaves, I just came back with a renewed desire to make it to Oz again and live there full-time by 2009. And, not being the criminal type, I've had to save my pennies and pounds the old-fashioned way: I've had to sacrifice. It was something I should have done (or kept doing, really) after college, but slipped and kept slipping. God bless any others who have to weekly schedule 'budget' time to do another assessment of bills vs goals, goals vs wants, wants vs needs, needs of sanity with calculator vs the slowdown of insanity with a computer budgeting 'tool'. I am finally seeing some progress, and not just in my 50+ ways to cook Spam® for meals.

To date, the advancements and the plan:
  • reminders in the wallet for what I need to save for (in my case, temporary housing in my beloved Oz and Sydney), helping me remind a need vs a want
  • weekly budget and goals planning sessions to stay on course
  • all monthly bills, including rent and misc, budgeted for and paid on time since this past January (and since I lived in my truck 6 years ago, to even have a good place to rent, I am more than blessed for, believe me)
  • two discount store credit cards paid in full, no new charges
  • one auto repair maintenance card paid on full, no new charges
  • clothing store credit card paid in full every month, no new charges
  • gasoline cards paid in full each month (and damn thankful I no longer commute 35+ miles each way to work anymore in light of the gas prices now)
  • one college loan paid, no new balance, paid in full last week (leaving only one loan to contend with now)
  • only two hospital/medical bills remain (not bad for having serious illness for more than a year and no medical insurance simultaneously, owing a six-figure sum)
  • one major credit card (I only have 2, I can resist temptation occasionally), the one with the higher interest gets paid off next week
  • furniture/electronics card that I pay on behalf of relatives paid in full by 18 August, and account closed thereafter
  • the other major credit card will be paid in full by 1 December (and then I'm looking for a better deal for the future, if I don't find one better before then)
  • a personal loan which I have been paying on devoutly since end of Feb this year will be paid in its entirely by this New Year's Eve (Word to the wise: don't travel with friends if you can't afford to go without their help...it can, does, and has gotten ugly. It puts everybody in a bad spot, and causes problems. I know this from my travels firsthand. Don't do as I did: if you don't have the money to fund your own way completely beforehand, don't go until you can.)
  • increased 401k investing and new increased savings plan begins 1 January 2007
  • pay off other student loan (electronically from somewhere in Oz LOL) by 31 December 2010 (6 years early with additional monthly payments over time)
  • never allow myself to get into debtor's hell again

    And, PLEASE...anyone get ideas how to do this better???...TELL ME HOW.

    If anyone else is having the same problems or just wants to learn more about being honest with your money, I strongly suggest the following books/sites/media:

  • Clark Howard (author, radio talk show host, and arguably one of the smartest men in America about consumer affairs, credit, and managing money), really great guy. The radio show is broadcast on the web in many markets and you really do learn something from him everyday.
  • Straight-shooter Larry Winget (God bless my fellow cowboy boot fans), and especially his great book: "Shut Up, Stop Whining, and Get a Life". He is also host of A&E's network's "Big Spender" TV show. Complete with a wardrobe that only strong men and certain Kiwi guitarists can truly appreciate.
  • And finally, Jean Chatsky and her book, "From Debt to Wealth on $10 a Day: Pay it Down!!" Don't let the title confuse you, she has some really great tips on saving that $10 by just cutting back or eliminating it from something unnecessary you already spend it on. She's the personal finance correspondent on NBC's "Today" show, and also shows up a lot on "Oprah", too, but don't hold that against her, please.

    Gotta go now, got pennies to count...got dreams to dream.
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