How to Create a Financial Disaster (Part II of III)
Welcome to Part II to of my three-part series on how to create a big ol’ financial mess. If you missed out on Part I, you may want to start here.
When we left off, I was living the undergraduate high life and financing the whole thing with unsecured credit. It gets better (which means it gets worse).
Step four - Drop out of college
Sometime during what should have been my senior year of college I decided I just didn’t want to go to school anymore. It was too late to get my tuition refunded, but that didn’t keep me from sleeping through my courses. Inevitably, I failed all of my classes that semester. As a result, I didn’t qualify for financial aid for the next term. Whoops.
At this point, a reasonable person may have chalked the whole thing up as a painful yet poignant life lession, confessed their behavior to their parents, and begged to be bailed out. At that time of my life, no one was accusing me of being reasonable.
Instead of asking for assistance, I decided to move to Chicago and become a nanny.
Step five - Run away to a place where rediculously wealthy people live
I knew that I was in trouble, so I decided that it would be in my best interest to move away from some bad influences and find a decent paying job in a big city. I had a lot of debt and couldn’t afford metropolitian rents, so I chose to become a nanny. The pay was good, room and board was provided, and it gave me the opportunity to see how “the other half” lived (I later found out that the “other half” is actually the top .5%, but that’s a story for anther post).
Glencoe Illinois is a quaint little Chicago “north shore” suburb situated between Winnetka and Highland Park. While there, I had access to a full-time maid, drove a BMW 740i, and was paid $500 a week. The money was good, but I was homesick for my friends and extremely bored. I filled the long, lonely weekends traveling and shopping. I did manage to payoff much of my plastic, but I left my student loan debt in deferment. When I decided that nannying was no longer for me, I was in a bit better shape than when I had arrived nine months earlier.
In hindsight, this little life “detour” was a major contributor to my rampant consumption that started in my mid twenties and has just begun to taper off. Something about the whole experience led me to feel that my value as a person was directly related to how much I paid for a handbag. The family that I worked for was compulsive about keeping up with the Joneses, and were always buying the latest and greatest to one-up the neighbors. While living there, I discovered sushi, live-in housekeeping, Prada, and the afore mentioned (beautifully engineered, rediculously expensive) BMW. While I knew about these things before moving to Chi-town, I came back longing for all of them.
Step six - Move in with your boyfriend (or girlfriend)
On my 23rd birthday I moved back to the town where I had attended college. My boyfriend and I, in our infinite wisdom, decided to shack up. He was much older than me, and a homeowner, which was perfect for me since I found myself homeless. I found a part time job working as a teller at a big bank and thought about going back to school to finish my bachelor’s degree.
I lived with him, rent free, for nealry four months - at which point we had a huge fight about money (naturally!). He asked me to move out. I found a little studio apartment that I rented for $250 a month. It was the first time I had ever lived completely alone, and I loved it!
Turning a corner
If you’ve been with me from the beginning, I’m sure that I’m going to have a tough time convincing you that I’m actually a pretty smart cookie. I’m an avid people watcher, and as I went from being a part-time teller to a full-time teller at the bank, I began to to pay attention to my customers’ spending and saving behaviors. I saw the “Millionaire Next Door” phenomenon literally play out in front of me, over and over again. I was shocked to discover that the people who really had money drove up in beater cars and didn’t care much (if at all) about who designed their clothes. They saved religiously, always paying themselves first. On the other hand, the people that looked like they had all of the money in the world were actually mortgaged to the hilt and behind on their car payments. I found myself thinking about this quite a bit.
I started tracking my monthly expenses in Excel. I paid off my remaining credit card debt and put a few hundred dollars in a savings account. I finally felt like I was getting my act together.
Want to know where I am now? Come back for the third and final post of my Financial Disaster series - all will be revealed!
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