The old saying “The road to hell is paved with good intentions” goes double for me. My parents did everything in their power to raise me with frugal, conservative financial values. I, in turn, did everything in my power to thwart their efforts.
I succeeded in making my life a financial train wreck. Want to follow in my path? Follow any one of these eleven easy steps and you’ll be well on you way. Freely mix and match to create your own special recipe for disaster.
Step One - Spend all of your savings
I was raised on a farm, so I had the good fortune of being able to earn my own money at a very early age. Half of my birthday money and half of every dollar I made doing chores, baby-sitting, life guarding, and waitressing went into a savings account in my name, right up until my 18th birthday. I went off to college with well over $20,000 in that savings account - and proceeded to blow through it all in less than two years. I’m not sure exactly what I spent it all on, but I know that a small percentage of that cash went to books (totally legitmate for a college student) and the rest went to “entertainment” expenses (flagrant mismanagement of funds).
Step two - Charge it!
Once the cash ran out, I needed a way to finance things like clothing, food, and “entertainment.” I was 20 years old when I discovered the wonderful world of credit cards, and I’ve been hooked ever since. Plastic was my first taste of debt, and it was intoxicating - spend now, pay much, much later! Suddenly I could afford all sorts of great stuff!
Step three - Maximize student loan debt
Just before my junior year of college, I filled out my own FASFA form for the first time. The subsequent financial aid award letter came directly to me, instead of my parents. That is when I discovered that the federal government will lend you WAY more money than you need to cover books and tuition at a state university. Naturally, I took the maximum allowed (subsidized, unsubsidized, what’s the difference?!).
Living the Good Life
Between the bi-annual student loan checks, the plastic in my wallet, and the cash I always had on hand due to the fact that I was a waitress - I had a pretty high standard of living for someone with a negative net worth. As far as I was concerned at the time, there was no going back to being just another broke college student.
Click on the links below to be directed to Parts II & III of the series:Stumble it!