My Financial Perfect Storm

 
I am attempting to pay off around $18,000 in consumer debt (We won’t talk about student loan debt yet, one step at a time!). A LOT went into building up 18 thousand dollars of debt.

I thought I had learned my lesson after the last time I acquired debt and the filed bankruptcy. I thought that I understand the dangers of credit cards and was capable of making better decisions.

I can look back now and see that I was clueless. I didn’t have the financial education that I needed to avoid debt in the future. And when the right situation presented itself, I found myself in more debt than I could handle.

The conditions for me to get into more debt than I could handle are three-fold.

1. My Divorce. When I left my husband, I did it with very little money. I knew that a divorce was eminent but hadn’t had enough time to squirrel away money. In the end I had to take a cash advance from my credit card to pay for an attorney. The final cost for my divorce was around $4500.

2. My Mental Health. After 6 years of being in a relationship that I didn’t want to be in, I found myself single. I was elated! I celebrated some in the beginning. I was so happy to be able to make decisions without debating. Every. Single. Thing. And. Always. Being. Told. I. Was. Wrong. My self esteem was wrecked due to the emotional abuse I had lived with and it took awhile for me to regain the strength I had prior to my marriage. I fed a lot of those emotions with impulse purchases, all charged on credit cards.

3. New Kids on the Block. We’ve heard a lot about my love for New Kids on the Block recently. They are certainly not budget friendly. They happened to reunite in 2008 just as my divorce was happening. Here I was, dealing with the most difficult thing I had ever had to deal with when something that once meant so much to me reappeared. The desire to fulfill childhood dreams was far too easy to give in to when I had credit cards on hand.

When I first heard the news that they were reuniting, I decided that I would be sitting in the front row no matter what money it cost me. This was due to a horrible experience as a teen when I was in the very last row at a HUGE stadium and couldn’t even tell who was who on the stage. I promised myself that I would make that right. It ended up costing me $500 to do so (ended up in the 3rd row but I got to meet them so that worked for me). The only problem was that I became addicted to seeing them and trying to meet them again. Within a month I traveled out of state two more times to see them and then many many times after that.

Those three things all meshed together to create the perfect financial storm for me. I was incapable of avoiding it.

I could have avoided it though, with proper financial education.

If I knew then what I know now, I would have been better prepared for impulses. I would have understood the danger of what I was doing and I would have thought about my future more.

I still don’t feel like I can handle another perfect storm but I’m working on it. At least now, I know what I should be doing and I’m thinking about it every day. A couple of years ago, I had my head buried in the sand while the storm was brewing just above me.

Did you have a perfect storm? Was it more of a series of smaller storms pelting you repeatedly? Can you pinpoint what caused your debt?

 

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