Starting Over

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It seems I’ve talked a lot about that on this here blog but here I am, yet again, with a report of having to start over.

Life became a bit more than I could handle and I found myself having to make what felt like dire decisions to just get to the next day. In a period of five weeks:

  • Broke my foot (this cost me over $600 out of pocket);
  • Lost my apartment (cost me over $2,300);
  • Finagled a last minute move that was crazy expensive (cost me over $200); and
  • Spent over what I would have normally spent to get to work ($30 a day or $150 a week).

I was making $14 an hour and I thought that spending money I didn’t have to spend was the worst of it. For a while, it was. Then I took a trip to Hawaii (that had been paid for the year before) and lost my personal identification and bank cards. Oh joy! That was surely going to be the worst of it?

Not. At. All.

It seemed as though collectors and creditors knew I was in dire straits and called for every single dollar they’ve ever leant me to be paid back. By this point, I was living with my Mom and had to enlist her help in this. The final verdict? She wouldn’t be able to help me.

And this is where I find myself today – steeped in embarrassment at my financial state and wondering IF it ever actually gets better for the poor folks who were born poor?

It might not but after some deep soul searching, I’ve recommitted to the idea of starting over, really starting over, so that I can eventually own my name. My debt has become a noose around my neck and while I know that money doesn’t buy happiness, it would certainly allow me to afford the scissors to cut myself loose.

We shall see!

Check Your Financial Health

Are your finances on Life Support? Do you think you have a good idea of what you need to do to get them under control?

Well, if you found this blog, I’d bet my last dollar (not really) that your finances are in a bit of trouble AND that you actually need help getting them under control. Not to worry! This quiz will give you an idea of what you need to start working on. These questions will point out areas that you need to work on yourself. I’ve included a quick write-up at the end of where I stand because I want you all to really know you’re not alone. I’ve also included a link to the original survey because I’ve modified a few of the questions (all modifications are italicized). Here are my answers!

  1. Is more than 15 percent of your income going to pay any kind of debt? The MAJORITY of my income actually goes toward Student Loan and Medical Bills. I look at my income in two different ways: “Before Taxes” and “Take Home” to get an idea of where my money actually goes. I’ll write a post about why this is useful and give you tips/tricks on how to simply calculate where your money goes. (+1)
  2. Are you borrowing money or using credit cards to pay for items you used to pay for with cash? While I don’t borrow money or use credit cards to pay for items I used to pay for with cash, I have developed a nasty habit of using my credit card (which was originally for emergencies) to get me through half of the month. At the time of this post going live, I’m in the midst of developing a personal Credit Card challenge (to clear that balance for good). I also have a few store credit cards with balances near the limits. (+1)
  3. Are you dipping into your savings or any other money stash to pay current bills? In order to dip into a savings account, there must be something in there for you to dip into. Since I’ll readily admit that my savings account looks empty, I have to go ahead and give myself a point for this question. (+1)
  4. Are you paying bills with money intended for something else? Thankfully…no! All of my bills are actually set up on a Kwik-Pay or Automatic Debit System! Additionally, I set them up on days where my Direct Deposit hits my account. It’s almost as though I don’t miss the money because it’s gone before I really have the chance to notice it. I got something right. 🙂
  5. If you or your spouse lost your job, do you have less than three months’ take-home pay in a savings account? Unfortunately no. This point hit home for me when I had to take time off of work to heal from a surgery. Here’s another point for all of the wrong things. (+1)
  6. Can you usually only make the minimum payment on your credit cards or any other credit account? No. I’ve set up automatic payments to take out more than the minimum payment. While this is great, I’ll admit here that the payment amount isn’t enough to put a real dent into the balance on the card.
  7. Are you extending repayment schedules – paying in 60 or 90 days bills you once paid in 30 days? No. This makes me feel a little bit better (this quiz is slowly making me think about all of the things I need to work on). However you should also consider ask yourself this question another way — do you have to ask for extensions on bills because you don’t have enough to cover the small balance for that month? If I ask the question that way, the answer (thankfully) is still no.
  8. Are you near, at, or over the spending limit on your credit cards or spending accounts? Yes. (+1)
  9. Do you take out a new loan before the old one is paid off or take out a new one to pay off an existing loan? No. Thank goodness. The only loans I have are Student Loans.
  10. Are you unsure of how much you owe (within $50)? No. I’m aware of how much I owe. My problem has been getting a handle on being able to put a real dent into it.
  11. Do you habitually pay your bills late? No. Look at answer number 4 for the explanation as to why.
  12. Do you charge more each month than you make in payments? No. I use my credit cards in waves. There may be a period, say of 3 months, where I don’t use them at all AND then, I’ll get all emotional and go on a shopping spree. However, I’ll answer yes to this because the difference in what I buy and what I pay still plays out in much the same way. (+1)
  13. Do you use a cash advance on one credit card to make payments on other credit cards? No. Pretty impossible to do this with one credit card.
  14. Has a collection agency called recently about an overdue bill? Yes. As of the date of this blog post going live, I’ve actually been receiving pretty consistent calls from two companies. *deep sigh* I’m too young for this. (+1)
  15. Are you threatened with repossession of your car, cancellation of your credit cards, or other legal action? No. It hasn’t gotten there yet…and the point of this blog is so that it doesn’t get that far.

I scored a 7. If you’ve answered “Yes” to three or more of these questions, you’re at risk of increasing financial distress and if you gave four or more “yes” answers on the financial health quiz, you’re at risk of slipping into the financial danger zone. My seven means that I DEFINITELY have some areas I need to work on.

But as with all things, it gives a nice snapshot but not really the whole picture. Because this only offered a snapshot, I included the links to two other quizzes below:

How Healthy Are Your Finances? Source: CNN Money. This is an interactive assessment. You start by putting in your age and your gross annual income and go from there. There are some pros and cons to this. The biggest plus is that it is easy to use and gives you a neat little picture of your financial health. It asks you to input how much you put toward (1) Retirement Savings; (2) Housing Payments; (3) Debt; (4) Emergency Savings; (5) Diversification of Stock; (6) Company Stock; and (7) Life Insurance. The major drawback is that  it assumes you work for a company that offers things like company stocks or that you’re investing in the market. I’ve included my neat little picture below (so you can see that I also need work):

As you can see, I got a "C" as a grade on the CNN Money Financial Health survey. It tells me the areas that I need to work on and the areas that I'm doing okay with.

As you can see, I got a “C” as a grade on the CNN Money Financial Health survey. It tells me the areas that I need to work on and the areas that I’m doing okay with.

Quiz: How’s Your Financial Health? by Better Homes & Garden. This one definitely works if you need to consider the spending habits of another person (say, your significant other). For me, there were a few questions that I couldn’t really figure out how to answer because I’m single. However, it’s simple to follow (as it’s a click-through quiz). My only annoyance was the pop up ads of to the side. I didn’t get to see my result because page 3 continued to reload whenever I pressed forward.

I hope that these questions get you start thinking about your Financial Health in a different way and on the road to where you wish to be.