Sunday, April 25, 2010

Couldn’t You Have Picked a More Exciting Hobby?

Perhaps you have borrowed too much on your home. You have credit cards, a car loan or two, and even student loans. Most Americans do; it is considered "normal". For the past few years, times have been tough and families have had to cut back. Maybe you have struggled for so long that you have accepted the situation and are no longer looking for a way out. Today, allow me to begin to share that there is a way out, but it will require extreme sacrifice on your part for a period of time.

Over the years, I've read several financial books and articles. I even spent real money on some of those books, actually on quite a few of those books. I could probably stack them up to my waist. I thought one day I’d look back and consider them a wise investment. Most of them covered what needed to be done with money, but lacked in the “how to” department. Some discussed ways to make more money, but didn’t really share the secret of not spending more if you did.

You might say that since leaving college, studying personal finance has been my hobby! Right now, someone is thinking, “Wes, couldn’t you have picked a more exciting hobby?”

Now, let me tell you right up front that I am not a financial planner or a CPA - just a normal guy who had money problems. I think that defines the majority of Americans: Normal people with money problems searching for a solution. I searched for years for a money program that would get me out of the big, deep hole I had dug financially. I was responsible for the hole; therefore I wanted to be responsible for filling it in.

Honestly, there have been a couple of times in my life when I had credit card debt and then I did not. The first time, it was because I took out a consolidation loan. I rolled my credit card debt together with my car loan. Amazingly, after spreading out the pain over five more years, collectively I had a lower payment. The consolidation loan seemed like a great deal, except that it did not teach me a thing about getting and staying out of debt. In fact, it was not long and I had credit card debt again. Also the new loan extended the period I would pay on my car by three years past the original payoff date.

Fools think their own way is right, but the wise listen to others. - Proverbs 12:15

Then a couple years later (2000), I was at a six-month school for the Army. I was not spending much money and was able to quickly pay the credit card debt. I do not remember how much it was, but $5,000 would be a close guess. It was a great feeling to be free of credit card debt. I felt like a chain had been lifted from me. I still had several other chains holding onto me though: the consolidation loan with three more years of payments and quite a bit more in student loans.

Even though I had conquered the credit cards, I was not able to apply the same discipline to the other loans. One reason was that compared to the small amount of credit card debt, the student loans were an enormous amount. The payments were not huge and I could afford them. Paying them was painful though. Each month as the checks were written, I would think of what could be done with the money dedicated to them.

So, I continued to search through books for a plan: the perfect scheme to solve my money problem. Recently I found out that whenever I brought home a new book, my wife’s thought was, “Oh boy, another book on money.”

At some point, I had had enough of programs and “get rich quick” solutions – unconsciously I had stopped searching for a fix. I was ready to accept the “fact” that I would always need a credit card for emergencies. Life was trying to tell me, “You will always have a car loan, home loan, and student loan payment." Personally, acceptance of that kind of mediocrity would have been regretful! I would have been going through the motions: working hard to keep the bills paid, but never really seeing a brighter future through it all.

Have you ever had one of those moments where emotionally you have given up, but mentally your mind says, “God, I’m ready and willing, please help.”

To be continued...