To Your (Financial) Health IV
I have been telling you about a fellow I know, a fellow I call ‘Ari’.
Ari made over one hundred thousand dollars a year–one hundred twenty thousand dollars, to be specific, and when he first contacted me about his financial health and how to improve it he had almost two million dollars in debt. His financial health, was poor. Very poor.
But through a series of undeniably drastic measures and a strict regime his financial health soon improved and he is now the picture of financial health.
But right now I want to take a break from discussing Ari’s financial health, his situation, and, instead, talk about my own financial health. As I write this I am in the best financial health of my life. I have no debt, I have money in the bank, and I just bought a new mid-size Sport Utility Vehicle (SUV).
Impressed? Good. Interested and intrigued how I reached this position, especially at a time when personal bankruptcies are up, new home sales are down, and savings on an individual level are all but non-existent? You should be. Because now, more than ever, your financial health is absolutely critical. Baby boomers are beginning to retire or will retire shortly, downsizings are a given in today’s reality, and medical and dental expenditures are insane.
To know, though, where I am, where you can be and should be, you need to know where I come from.
I grew up in a middle-middle class family of four. My father was an electrical engineer for thirty-five years, my mother a Registered Nurse, who started the first child care center in the town where we lived, some of my pre-teen and teen years were spent cleaning rental properties my family owned, and we took substantial vacations every year from the time I was three until I graduated high school.
Despite all this my family lived conservatively. I got hand-me-downs. I was expected to earn my allowance, some of which I had to save for future expenses, such as a car and college, and I was told more than once that certain purchases were not allowed because they pointless, wasteful, and unnecessary.
I got my first real job with income taxes when I was about ten years old, and quickly learned, as a result of this particular experience, what it meant to be a working stiff.
By the time I started college, then, I was well on my way to become a very financially well-to-do person. But then something happened: I went to college, found myself exposed to a world I didn’t know existed, and everything went. . . South. Everything. My work ethic. My financial health. Everything.
Understand: I accepted responsibility for my actions and behaviors. I accept responsibility for my actions and behaviors. No one made me apply for my first major credit card. No one made me use it once I had it. No one made me keep it.
And no one made me use up a substantial portion of my savings to that point to pay off the debt I had racked up on that card.
That is the down side to this particular chapter in my Life, my financial health. The up side is that I learned a very important lesson that went to set the tone for the rest of my Life, that all but determined the path for my Life, my financial health.
For example, the day I graduated college I was debt-free. Unlike many of my friends, classmates, and peers, many of whom were burdened with student loans, credit card debt, and, in two cases, a mortgage.
The day I graduated college I vowed I would never again take on debt I could not pay off in a reasonable period of time.
AH-HAH! You may say, as response to reading that. I knew it! There’s a trick here! It all depends, as Bill Clinton might say, on what your definition of ‘is’ is, right? What is ‘a reasonable period of time’? A day? A week? A year? Five years? Ten years? Twenty years? Thirty?
‘A reasonable period of time’ must be defined as your ability to pay for something before you buy it.
For example, I recently bought a new Honda CR-V. If you have priced such means of transport recently you know they are not cheap. I bought mine for about eight thousand dollars less than market price, not including title, taxes, and related fees.
There were several factors involved but the most important one is: I paid cash.
I know what you may be thinking as response to this admission: You paid cash. No one pays cash nowadays, especially for big-ticket items such as new vehicles because almost no one can afford to pay cash.
Well, you could if you did what I did, what I do.
Today begins the rest of your Life. Today is the day you begin your Life anew. Today is the day you make the conscious choice to assure your financial health and well-being.
Today is the day you go out and purchase–with cash–four items: A three-ring notebook with a spine at least three inches wide (Four inches is better.), a package of indexed section dividers, (I prefer the colored ones but you may prefer the clear or white ones.), a package of paper, lined or unlined (Again, I prefer lined; college-ruled.), and a black sharpie marker. This expense will cost you between ten and twenty dollars if you buy these items at K-Mart, Wal-Mart, ShopKo, or Office Depot. But it is an expense that will pay for itself many times over once you accept what I am going to tell you.
Now. Once you have these items take a deep breath and get ready.
Because I am going to make you healthy financially forever.