Broke as a joke – 306

I’ve reached a new low—I have collections calls coming in.

Despite not having regular income since September, between some savings, and a tax refund, and a lot of just moving money around, I was able to keep my payments up until May. (I don’t really recommend the moving funds around part, as all that does is increase the overall debt, but I didn’t see a lot of options.)

The point is, I could not make the May payments. Back in the old days it probably would have taken a full month to get calls on that, especially since I have been so regular up till now, but now it takes about two weeks.

It turns out that I am living true to my upbringing. When my father would open mail, he would say aloud, “Dear Deadbeat.” I always thought that he was joking. It never occurred to me that we could be behind. We weren’t making sacrifices or cutting back or anything. Turns out that he did not really put bills first, and that may be the story of how we were fairly early adopters of things like VHS, CDs, video games, and cable television (all of which are relatively quaint technology now, but this was the ‘80s).

I have sometimes written about things I should have done differently, and I will wrote more about things I could have done differently, and whether I should have or not, but there is one change that I definitely wish, which is that I had saved more.

Parenting guides suggest that have your children automatically save fifty percent (and give ten percent to charity), and I thought that was crazy, because the percentage is so high. The average working adult does not have the option of saving fifty percent. I realized that it makes sense because while they do not have expenses, that amount is probably high enough that when they do have regular expenses like rent and utilities, they will probably end up saving the right amount of disposable income.

I have looked at those statements from the Social Security Administration for what I made those first few years working, and I wish I had saved half. It would have made my first two years of college easier. It wouldn’t have necessarily had a huge impact afterwards, because any additional money I had would have just gone towards my mission.

Actually, I can’t say that, because in my case, I had enough credits that it only took me eight quarters to graduate, but those quarters were spread over six years. I graduated from high school in June of 1990, worked through summer and fall, attended winter and spring, and did the same thing the next year. Then, I worked through summer and fall, and left for my mission in February of 1993. I suppose it is possible that with better funding I could have gone all three quarters for the first two years, and have completed eight before going on my mission. Still, I would have missed walking with my graduating class, and various other events.

The more important lasting impact would just be the habit of saving first and spending later. It’s not that I have been completely irresponsible. I have been completely debt-free before, I have never lived really luxuriously, and even a lot of the debt incurred now (well, before the unemployment) is because of doing things for my family. However, I certainly bought things impulsively, that I did not need or even want that much, and they did add up. Having the habit of thinking twice before spending once would be invaluable, but it didn’t seem to matter. Okay, I didn’t see job loss coming, but that’s the whole point of being debt-free and having savings, right? There are things that you can’t see coming.

So, now I have to deal with this, and it’s hard. I have liked some of the rewards with the different cards, but I swear they are not worth it, and some of the interest rates and finance charges are completely immoral. If I was financially solvent than when the rates went up I could just take my business elsewhere, but I have trapped myself. As it is, as soon as it is possible Barclay’s and Chase will be gone. I will probably keep the Unitus one. (Leave it to a credit union.)

For the phone calls, I am just being honest. No matter how much they call, I cannot pay them something I don’t have. How they act now will affect how likely they are to keep my business once I am employed again. The other possibility is that I will declare bankruptcy. The Barclays one reminded me that would affect my credit for ten years, which is true, but missed and late payments will not be that good for my score either. That decision will only be made if there are absolutely no other options. Honestly, I consider it to be a form of theft—I just don’t know how low things are going to sink.

To be fair, some of them do have various things in place to avoid penalties. If I had called when I first lost the job, I might have been able to lower payments and keep going a bit longer. Still, my current contingency plan only gets me through July. Anyway, if you have recently lost your job, but are not completely broke (or are getting unemployment, which would be lovely), it might be worth calling your creditors to see what’s what.

For myself, I have been thinking about the things I have learned, and what I would like to change, and one thing is that I think as an adult I would want to save ten percent. I was feeling like I do not have a chance to try it now, or any time soon, because with no income I cannot demonstrate good income management. However, I did recently get my tax preparation bonus, and I made a little bit dog sitting. While paying my tithing, it occurred to me to go ahead and save ten percent anyway, so I moved $13.00 to my savings account. I guess it’s a leap of faith.