Winning that free car wasn’t the first time I had made bad financial choices. I’d been making them throughout my teenage years as well, even though I was debt-free when I entered college at eighteen.
After I quit ballet when I was fifteen years old, I turned to playing field hockey in high school. I was recruited to play Division III field hockey at a few colleges. I chose to attend the State University of New York at Oswego. I was a hard worker, and would often stay after practice to run more or do more drills.
My parents paid my college tuition and sent me a weekly allowance. The allowance wasn’t really enough money for me to live in the manner I desired, so to solve that little problem, I sold all of my college textbooks back to the bookstore right in the middle of the first semester. I earned a couple hundred dollars that provided the luxurious living I desired, but not the grades my parents expected. The first two semesters of my freshman year, I received a 2.4 and a 2.3 GPA. I was known for not going to classes and for partying too much at the bars. My desire to stay after field hockey practice and work harder started to decrease, and my coach started to notice. I was no longer a starting player in our games, and my grades started to drop significantly. Not surprisingly, it is hard to do well in school when you don’t have any books to study.
Shortly after selling my books back to earn extra cash, I received a knock on the dorm room door from another student. He was participating in a fund-raising contest for a college group in which they raced to see how many people they could get to sign up for a specific credit card in a two-hour period. I filled out the form, with no real intent to use the card. I just wanted to help the guy out. A couple weeks later, I received that shiny new credit card in the mail, and suddenly my eyes were opened to all that was now available to me. I was hooked, and immediately started using it. I didn’t have a car during my freshman year, so at first I was limited to using the card when I could hitch a ride with friends to the store. But once I brought a car back to school my sophomore year, I was playing with fire, and credit cards were the fuel. At any opportunity I would take the forty-five-minute drive to the nearest mall and shop my heart out, with no real plan on how I was going to pay the bill. It felt good, I looked fashionable, and I figured I would just pay it off in the summer when I went home to work at my waitressing job.
Early in that sophomore year, the same credit card company approached my field hockey team about doing a fund-raiser for our team. We were offered a certain amount of money per credit card sign-up, plus there was a bonus prize of $50 to $100 for the person who got the most people signed up. We all ran around campus getting students to sign up for credit cards, promising them they could just cut them up when they received them. One of my friends won the bonus prize for signing up the most people. She remembers that she was never paid the bonus and our team never received any money for the sign-ups. We had been scammed. The credit card company had won, and I had added another card to my name because of it.
I had no idea of the danger we were playing with back then, but we encouraged people to sign up and then cancel the cards. I wonder how many people actually canceled their brand-new credit cards after they showed up in their college mailboxes. I know that when I got my card it allowed me to continue to spend the way I wanted to; after all, I couldn’t live like a broke college student!
Looking back, I see a common theme. I was a broke college student, I was a broke newlywed, I was a broke twenty-five-year-old up to my eyeballs in debt. Yet in all three situations I spent like I was a rich college student, a rich newlywed, and a rich twenty-five-year-old driving around in an Audi. Why? I wanted to appear as if I “had it all.” When people talk about “keeping up with the Joneses,” I wanted to be the Joneses. The thought of changing how I spent money was so overwhelming to me that it just didn’t seem possible. I had no idea how to do it. It was too hard, I would tell myself. I felt that in order to get out of debt and learn how to spend money, I would have to totally retrain my DNA to stop it all. I had no idea where to even start, so I just continued to ignore it.
Big changes had to happen in my life when we realized we were $40,000 in debt. Big changes that terrified me. It may seem strange, but the necessary spending changes I needed to make scared me more than continuing to live in a constant state of being broke. Many other Spenders that I interviewed also felt the same way; it is easier to just ignore it than to deal with it.
I had a big ah-ha moment one day when I was faced with a loss. In between the births of my first two children, I had a miscarriage. I suffered from infertility for about a year and a half after my miscarriage and struggled to make sense of what had happened. After multiple visits to the doctor and one surgery, we were finally able to conceive again. During that time of infertility, everyone around me was getting pregnant and having babies. I remember being so jealous and praying to be able to have more children. Right around the time of the miscarriage was when we had our big discussion about the debt I had racked up. Everything had come to a head at the same time, and I found myself slowly spiraling into depression.
I spent many days and nights weeping for more children. But I also worried that we might not be able to afford more kids. I find it no coincidence that these two big events happened around the same time. I had to take a serious look at my values again, and what I valued more than money was a family. I wanted a large family so badly that I was willing to make those big changes I’d been so terrified to make in the past. Resetting my values helped me realign my spending.
What are your values? Where do you spend your money? And do the two line up? If you are a Spender, my guess is that you’ve never sat down to define your values when it comes to money. I certainly never defined mine. I shopped impulsively and rarely thought of the consequences. I hardly even thought about what or why I was buying; it always just sort of happened.
I realized that I had a major value crisis going on in my life. My spending was not a reflection of my value system. I valued family, growing old together, education, safety, my faith, and togetherness. If you looked at my checking account, you would be fooled into thinking I really valued eating out for dinner, shopping, entertainment, housing, cars, and random “stuff.”
My spending was putting my family at risk. I was hurting my marriage, my kids were not going to have any money to pay for a college education because I had no savings plan, I wasn’t saving for retirement, and I had little sense of togetherness with Mark. I was thinking only about my own needs, and my selfishness was pushing me further and further away from the things I valued most.
I realized I had to make a change, not only for myself, but for my family. They needed a solid financial future, and I needed to stop spending money so I could give that to them. Sounds easy, right?
Suddenly I was faced with another hard decision. One of my values came from being a mom, and I didn’t want to work full-time, but in order to get out of debt I saw no other option. I was struck with another value struggle that most finance experts don’t even touch on. How could I be a stay-at-home mom, pay off my debt, and afford to live? This struggle affects us moms to the core.
Here’s a scenario that may help explain this further:
The parents of two young children are facing the next steps in life, and many of their decisions are connected with household finance issues. With both parents working full-time, the family is on schedule to be completely debt-free in two years. But with two small children in preschool, the mother desperately wants to cut back on hours and stay home with her kids during those precious years. With more than $30,000 in debt and a tight budget, it is a difficult proposition. If she reduced her forty-hour workweek to ten hours, they could swing it. Their budget would be tight and they wouldn’t be able to make any significant progress on their debts, but they could make it without any day care.
What price does one put on spending time with one’s children in their early years? Is it even possible to assign a dollar amount to something like that? But because of financial pressures or lifestyle choices, many forgo this special time in order to better their current and future economic situation.
In the scenario above, there is no right answer. Spending more time with your kids now means delaying basically everything money-related: getting out of debt, saving for an emergency fund, retirement, college funds, and so on. Everything goes on the back burner for a few years. And there is no guarantee that the mother will be able to go back to work full-time once the children are in school. While that is certainly a steep price, millions would say it’s worth it. Think of the shared memories created with children at this age. Think of the greater parental influence you might have—will it carry over into their later years? Who knows? In the grand scheme of life, these memories might mean having to work three more years before you retire, maybe more.
Other women choose to work in order to provide for their children and get them into a good school district. There is no right or wrong way to raise a family.
Amid all the great financial advice and articles out there, remember that you have a life to live. Why do we work? Why do we make money? Why do we want to retire? Why do we want security? These questions cut to the heart of life’s meaning—and they underscore the roles that work and money play in our everyday lives. When mapping out your financial future, your end goal isn’t simply a ton of money; it is comfort, security, and whatever makes you happy. Money is only a means to that end. But here’s the rub—you’re living right now.
Anyone could conceivably work sixteen hours a day, live in a tiny apartment for years, and never start a family. If you did this right out of college, you could probably retire at age thirty-five and never have to work another day. Would you even be living life? What do the kids say now—YOLO? “You only live once.” That phrase usually alludes to an impending impulsive decision, but it also boils down to the fact that each of us has only one life to live.
This hits at the crux of what I am passionate about and why I wrote this book: the intersection of life and money. The whole point of becoming financially independent is the ability to live your life freely, without sacrificing your values.
Every big decision has financial consequences. I have made my fair share of decisions that bore horrible results and took me years to undo. Quite often, we need to make a financial choice that might hurt initially but is more than offset by the impact on the quality of our life and relationships.
Here are some examples from my own life:
February 2007: I had finally come to terms with my bad decisions. I stepped down from my position as a director with the MLM business, despite all of the debt we were in. My team was no longer meeting the required ordering needed, and I was suddenly faced with a $900-per-month lease payment to drive that “free” car. I added up all the debt we had and realized that with the failure of my formerly successful direct sales endeavor, we were now running a $1,000 deficit in our monthly budget and something had to give. I had only one option—I had to get a job outside the home. I went out that day and landed a job as a waitress at an upscale Ruth’s Chris Steak House. But this meant being away from my son five nights a week. It was a decrease in quality of life, but it got us through a rough spot financially. I was willing to make a short-term sacrifice for a long-term gain.
Fast-forward to January 2008: I was working several nights a week and it had taken its toll on all of us. I wanted nothing more than to be a full-time mom. I just couldn’t keep up with working anymore. Although we couldn’t make much progress on paying down our debt, we decided that the benefit of having me at home with our two-year-old son was worth it.
We still had most of the debt, but we had to find a way to make life work on one income. Mark had a job opportunity that boosted his salary a bit, but our monthly budget was still short. I figured out that if we cut our grocery budget in half we could make it work. Thus began our introduction to the world of coupons.
June 2010–current day: I am debt-free. I work full-time on my website, while three of my kids are in school and the youngest is at Grandma’s house a few mornings a week. I travel to New York City once or twice per month to go on the Today show, Dr. Oz, or another national TV program. I am a working mom, and I wouldn’t have it any other way. I get to share my story of hope with millions of people every year, and for that I am incredibly thankful. My kids get to see our journey full circle, and they are proud of me and what I get to do.
There are many more examples of these significant life/finance choices that we all need to make. You need to figure out a way to make your value system the center of everything that you do. Then decisions become much easier to make, and you have more freedom than guilt in making them.
Paying off your debt or staying at home with your kids is a hard decision, but let me tell you that if you are a Spender you can make the choice right now to stop spending money and start paying attention to your finances.
I discovered that saving money is just as productive as earning it. If you go out and get a minimum-wage job that pays $150 per week, wouldn’t it be the same as saving $150 per week? When you start to look at things this way, there is no reason why you can’t have your cake and eat it too.
Over the next four years I learned how to save money and change my spending habits. It wasn’t easy, but because what I was doing was aligned with my values, it was easier to find motivation and stick to it when times were hard. Our values are reflected in how we spend our money. Having money causes feelings of self-sufficiency and power; it touches everything. It is the very thing that makes life work.
I can’t tell you what your values should be, but what I can tell you is that once your money and values are in sync, it is much easier to stop spending.