In response to the overwhelming number of emails I’ve been getting (no, I haven’t) from people begging for my help (no, they’re not) because I am so immensely wise concerning all things finance (no, I’m not), let me attempt to bring down my celebrity a notch or two and share with you all a little story about how things were going just a little over a year ago. And to get there, let’s start back at my 18th birthday. Don’t worry, I’ll go fast.
A Long Time Ago, In The Same City I’m In Now
June, 2007. I’d just graduated high school and planned on going to community college that fall, but nothing about adulting had really hit me yet. That summer didn’t feel any different than the other summers in between school years. I was still living at home, and my relationship with my dad was healthy, so I wasn’t facing any kind of deadline to leave. I knew that I wanted to be better with money than my parents had been (and I think they wanted that for me as well), but I don’t think Googling “be better with money” is how Warren Buffett got his start. The only thing I knew was that you needed credit if you were going to be a respectable American. From the articles I had read online, if you didn’t have a perfect credit score, you wouldn’t be able to get a job or a house, girls would completely ignore you, and your dog would pee on your bed every night. So obviously, I had to apply for a credit card, right? Chase was more than happy to oblige, giving me a student card with a $500 limit.
I was hooked.
The Phantom Menace
Month after month, I’d put a small purchase on the card– gas or a meal at a restaurant– and I was great about paying it off. I started watching the rewards points roll, er, trickle in, and I could just feel my credit score skyrocketing towards perfection. I applied for two more major cards over the years (I thought that was diversifying), as well as a couple store cards, a loan for my car, and of course I took out student loans. To fully round out my financial smugness, I started contributing to my employer’s 401(k) as soon as they let me, all the way up to (but no more than) the match! Man, I was so smart with my money!
I didn’t have savings because I couldn’t afford it, but hey. I had credit lines worth almost $10,000 that I could fall back on! And there’s no way I’d ever need that much, I didn’t have anything even worth that much! Life was good for a while. And then my first major car repair came. Clocking in at $500, the entire limit of my first card, I swiped a different one without even thinking about it. I figured I’d make payments and get it taken care of, no biggie. My car’s gotta get fixed, right?
I think you know where this goes (spoiler: it ends up with me being $80,000 in the hole), so I’ll fast-forward a bit.
Attack of the Loans
Rachel and I talked about money a few times before we got married. We discussed how our parents had handled money, and where we thought we could do things differently. But we never talked about how we were going to do them differently. We knew we didn’t like having payments, but it was just a fact of life. We might be paying on the student loans until our 40s, but by then we’d have better jobs that would allow us some breathing room.
For a while, we were doing pretty good. We’d get some extra money here and there, and some of it would go towards the student loans, some would go to credit cards, and most of it would get spent. Little by little, the balances were going down, though, and that was enough to keep us complacent.
Revenge of the Chef
A few months into our marriage, things got real. We found out that the $40,000 Rachel had taken out for culinary school wouldn’t be repaid by the military like we thought it would. The money was issued through private loans, which not only disqualified it from being repaid, but also exempted it from many of the regulations that are in place to keep things fair for new graduates who don’t make a gazillion dollars a year. They could charge over double the federal interest rate and they didn’t have to work with us on any kind of income-based payment plan.
Long story short, we were now on the hook for $600 extra every month for as many months into the future as we could see. And I had no way to provide for my new bride. My own debt left me with my head barely above water, and here was an anchor heading straight for me that I just couldn’t bear, even though I had promised to do just that not even six months prior. If we continued our course, we wouldn’t have enough money to pay even the minimums on our bills, let alone make any headway. Initially, I was angry. It was her debt, why shouldn’t she be the one to figure it out? I’m not the kind of person that works two jobs, that’s for people that can’t get their life together. I’ve been great with money, all I have is $20,000 in credit card debt and $14,000 on student loans for a degree I didn’t finish. There’s no way I’m letting something sidetrack all this progress I’m making. Sometimes, I have over $100 left in my account before the next paycheck hits! Where would that money go if I had to start paying for her debt?
The Spouse Awakens
Then I had a little chat with God. I spent some long hours in prayer, earnestly asking Him to find some way for Rachel to clear this mess up. Can you believe I still thought I’d get out scot-free from the whole thing? As He tends to do, God had other plans. The more I prayed, the more Scripture came flooding back to my memory.
1 Timothy 5:8 – But if anyone does not provide for his relatives, and especially for members of his household, he has denied the faith and is worse than an unbeliever.
1 Corinthians 13:5, 7 – [Love] does not insist on its own way; it is not irritable or resentful; Love bears all things, believes all things, hopes all things, endures all things.
Ephesians 5:25 – Husbands, love your wives, as Christ loved the church and gave himself up for her (emphasis mine)
Galatians 6:2 – Bear one another’s burdens, and so fulfill the law of Christ.
Mark 10:7-8 – ‘Therefore a man shall leave his father and mother and hold fast to his wife, and the two shall become one flesh.’ So they are no longer two but one flesh.
If there was ever a time I had been wrong in an argument, this was it. The answer to our money problems was crystal clear: I needed to man up. Not only in making the payments for this new bill work, but in leading us both financially toward better stewardship of the money we had. I needed to admit my failures, kill my pride, and do what I needed to do to change our course. If I didn’t, I was dooming both of us to a lifetime of “great money management” of the type that landed us almost six figures in debt. I could finally see that there was no such thing as “my money” or “her debt.” All of it, the good and the bad, belonged to both of us. If we were going to defeat this monster, we had to do it together, and it didn’t matter what was “fair.” My days of spending without restriction were over, because my spending affected someone else now. My role as Rachel’s husband means that I’m to serve her as Jesus Christ serves His church. What kind of servant expects someone else to do the work?
Yeah, it was tough at first, but the longer we’ve been doing this budgeting/saving/paying down debt thing, the more our impulses have changed and the easier it’s become. Before, the clearance shelf at Target had the power to ruin an entire month for us. But now, we’re always thinking not only about today or even this month, but five years down the road. We’ve learned that every decision we make with our money has a butterfly effect. We’ve learned self-restraint, we’ve learned to plan, and we’ve learned to communicate better as a couple. I think that’s a fair trade from being selfish, broke, and worried all the time, don’t you?
My name is Kyle, and I’ve been terrible with money. You know the most freeing thing about accepting responsibility for such a huge mistake? It means you also have the ability to turn it around. There’s nothing preventing us from building wealth. The system isn’t against us. We’re not stuck where we are. God willing, we can make this $80,000 hole into something we can use to teach our children from in the future. The first step for getting out of a situation like ours is admitting you don’t know everything, and that what you’re doing isn’t working. The second step is finding out what will.
What about you? What was your money epiphany?