LEARN FROM MY MONEY MISTAKES
Today I want to share with you a glimpse of where I came from and what I learned along the way about managing my finances. Through these experiences I am hopeful, that I can help you to make better financial choices in your own life. We all have a financial story to tell. Everyone makes mistakes and none of us are born knowing how to manage our finances. Remember no matter what financial mistakes you have made, it is never too late to make a change. You can make the right decisions with your future and begin to get your life back on track.
When I was a 16 year old in high school I was hired for my very first job. I was so excited to have My first job, both to feel like I was independent and to be able to earn my own money. Money had always been tight in my family due to the fact that I grew up in a large family with 9 children. We never went without food or the basic essentials, but any luxuries were more rare. I always dreamed of the day I could buy myself my own designer clothes, makeup, shoes, etc. Most of my friends had certain brand names that I could never afford and sadly as a teenager I noticed and always felt inferior and even insecure about what I wore. It was hard not be jealous of my own friends and to constantly see all the things at the mall that I couldn't buy for myself. I remember my sister and I counting out change at times just to go and buy the makeup we wanted. I'm sure the cashier loved us when we came up to the register with all of our change to buy things.
So I guess it goes without saying that my first money mistakes began when I got my first job. It was at this point in my life that I began to learn my lesson on how not to manage my money properly. I earned about $5 an hr at the restaurant I worked at for my first job and believe me I spent every dime I earned. I loved to work, but I loved to spend money even more. I bought all the clothes, shoes, makeup, CD's, etc. that I had dreamed of for years. It felt great to splurge on myself and buy things I had only dreamed of owning before. I would have nothing to show for all my hard work because I would save absolutely no money.
I moved on within a few months to my second job and began to earn a little more and would begin working more hours. I would often work multiple shifts when possible just to get more money. Yet this entire time I would save none of it and spend everything I made. I bought my first car soon after this and thankfully I somehow managed to save up enough to buy the first car with cash. I loved that first car and drove it everywhere, it was the very first time I had a vehicle of my own. A few years later I would start college and would continue working full time. I took a job at this time working for a nursing agency and would pick up hours as a nursing assistant at various nursing homes. Have I mentioned yet that I hated my job? I knew from the time I became a nursing assistant that I was not cut out to be in nursing. I discovered however that the money was better than most jobs I had been in, so I continued to work that job. I would receive phone calls from the nursing agency and would choose not to get up most days and go into work, even though I really needed the money. When you really hate what you do for a living, it makes it very hard to continue to go to work everyday.
I started to really notice the lack of money since my working hours were so inconsistent at this time.I received my first credit card offer and applied, beginning one of the biggest mistakes of my life. The new credit card felt like it was the answer to help me pay things that I needed to pay, and to get me through to the next paycheck. So at this time I began one of my biggest money mistakes developing a bad habit of credit card usage. This money mistake would last for years as I began to grow my debt to fund everything I felt I needed and could not afford. I applied for a second credit card soon after the first, and then a third card. I needed a new vehicle at this time due to issues with my current car, however this time with credit card balances and an inconsistent work schedule I needed to get an auto loan. I now had an auto loan, multiple credit cards and did I mention college tuition. I started college at this time and In the beginning I was paying it all in cash. I was unable to get any scholarships, grants or even any student loans. I was informed that due to my parents income being considered along with mine, I would be unable to obtain any financial aid and would need them to sign for a loan. I quickly realized I could not afford the tuition, the books and all of my other bills. I soon began using credit cards for my tuition payments, books, food, gas and pretty much everything. I knew I had to do something about my debt problem, I just couldn't figure out what to do and things were quickly getting out of hand. I found a new job at this time and although I would be required to work third shift at a local hospital the hours were steady and the pay would be more consistent. I had decided right around the same time I took this more consistent job that I needed to move out on my own. I just can't believe at this time in my life, that I never once stopped to think of all these decisions I was making. I can't believe I did not consider how these decisions would affect my financial future.
I moved in with a roommate and I was very lucky because my roommate was not only supportive and pleasant to live with, but also a good friend of mine. We were both in college at this time in our lives and we got along well. Having a roommate was one of the best things I did at this time, because I simply could not afford to live alone. I continued along a path of self destruction adding on more debt on multiple credit cards and not budgeting at all. I began having my first overdraft fees and this continued as a repeat behavior each week. I would put more money on the credit cards I already had and even apply for new credit cards. I would pay tuition with these cards and even sign up for more cards whenever I needed auto repairs, etc. I could barely afford to feed myself so I would swipe my employee badge to pay for meals. Each time I would do this to get me by just until the next payday and I would miss a lot of meals during this time and would eat whatever I had could find that was cheap or free. Being a broke college student is hard but it is even worse when you have the stress of this kind of debt hanging over you everyday.
I met my husband in 2003 at a church group I was visiting and I began dating him soon after that in 2004. I was having some health problems at the time we started dating, which would lead to me needing a pacemaker placed that same year. This required a month off work with very little pay and even more debt this time, in the form of medical bills. By this time I was drowning in debt from all of my bad money decisions and at this point. I was finally starting to see where all these bad choices had led me and it was becoming very depressing. I never thought it would be possible to be in college in my early twenties and have this much debt! Sadly, it was possible and probably more common than anyone wants to admit. I would spend years after college trying to repay and begin to repair all of the damage done, just within those few years after high school. The reason I tell my story is simple, I want to begin to raise awareness with others on how badly your financial decisions can affect the rest of your life. You may think that you will make more money in the future and be able to pay it off quickly, but that is not typically the case. Learning to manage debt early on and learning to avoid ever being dependent on credit is so Important. Trust me!
My biggest money mistakes.....
1. Credit cards.....Signing up for credit cards and using them without understanding how credit works. Make sure you understand what a credit card is before you sign up for and start using it. You do have to repay everything spent on a credit card plus interest and credit card companies love to give you credit lines. Credit card companies do not want you to pay a credit card off, they want to keep you in debt and unable to pay it off. Credit card companies make more money off of people like you and I, people who use credit cards and can only afford the minimum payments monthly.
2. Not preparing ahead....Moving out on my own too soon without a plan and without adequate savings to fall back on. This was a huge decision and I made it quickly and without a lot of preparation and financial planning. If you have time to plan ahead this would be best to begin to save and prepare in advance.
3. Going to college without financial aid or scholarships....Going to college without being able to afford it was a big mistake for me. I began using credit cards and eventually student loans to cover tuition because I could not afford my tuition and books.
4. Ignoring my bills and contact from creditors.....Overdraft fees on my bank account, overage fees that were out of control on my cell phone bill, ignoring the hospital regarding bills I owed for my surgery. Yikes! All of these were bad decisions made when I was already pretty far in debt and unable to make my bills. I learned very quickly that Ignoring a creditor will not make them go away.I made so many bad money mistakes as a young adult and in making all of these mistakes I learned some hard, but very valuable lessons. Money is not free or easy to come by and credit cards are dangerous. Creditors and banks do not care about you and your cell phone company will be glad to shut off your phone if you do not pay your bill.
Biggest lessons learned
1. Be careful with credit
2. Make a budget and learn to stick to it
3. You need to have health insurance
4. Save money and do not spend everything you make
5. Balance your checkbook
6. Pay your bills on time
7. The amount of money you make is important, but it is more important how you manage what you make.
8. Never pay for college tuition or textbooks on credit cards unless you pay them off immediately
9. Learn to live within your means
10. Accept yourself for who you are and do not compare yourself to others
If there was only one thing that you take away from this post today, I really hope you can learn from my mistakes with money. If you have made similar mistakes you can start today to get your finances on track. Make a budget and decide today to start paying down your debt and stop accumulating more. Trust me when I say you will not regret this choice and your future self will thank you!