Where I Went Wrong

I'm intelligent, talented, have a good job that pays me well, and have had more good luck in this life than I deserve. So why am I broke?

Broke? Yes. I'm 40 years old, have zero credit-card debt, few savings, owe back taxes, and my wife has student loans. Our net worth is negative.

I think there's three reasons why we're broke, and I think they may apply to many readers as well, so I'm going to talk about them here.

First, I haven't been interested in money before now. My parents never had a lot of money (he was a writer and editor; she was a teacher) but they handled their money well and were thrifty. We were never extravagant, (always bought used cars, fixed things ourselves, etc.) but never poor.

I think if we had been poor -- had really been hurting for money, in the "not enough food" sense -- I might have valued money much earlier in my life. But I always had enough growing up.

And I wanted to be an artist. I had contempt for money.

I've been a poet, and am still a photographer. I helped found and manage a non-profit theater company (non-profit both in the sense that we were a 501c3 charity, and because we rarely made a profit), and while money was always an issue there, it was never our purpose. We'd happily do non-commercial plays if we could find a way to fund them.

Money was a means to an end, and since I'm lucky enough to be a computer programmer and system administrator, I was never out of work for very long. Living paycheck-to-paycheck worked just fine for me.

Second, I seemed to feel (and I've figured this out only after quite a bit of therapy) that I deserved whatever it was that I wanted. That it was unfair for my wants to be limited simply because my funds were. This sounds greedy, but it also applied to gifts for others. Rather than greedy, it was childish. Spoiled. I would buy whatever I wanted -- I avoided major debt, but would happily spend my paycheck on eating most meals out and $20 to $50 items from Amazon. (I was on a first-name basis with the FedEx, UPS, and Ontrack delivery people.)

If I was having dinner with a friend I'd pick up the bill -- or I'd buy an expensive gift for someone. As long as I didn't entirely run out of money by the end of the pay period, I was fine. And if I did run out, I'd just scrimp until payday.

Finally, I ignored things that worried me, frightened me, or confused me. Since the IRS did all three to me, I ended up with a whopping bill for back taxes I'm currently paying off. If I was behind on my bills, I wouldn't open my mail. If I was getting calls from creditors, I wouldn't answer the phone. I was in deep denial about my financial situation, both to myself and others.

All this is a recipe for a financial basket-case.

And then I got married, just before I turned 40. Good lord, I'm ashamed that it took me that long to get my financial act in order, but somehow, having a wife and a new 9-year-old daughter -- having a family -- has changed everything for me. It's changed lots of things I'm not going to talk about in this post -- it's changed everything. But everything about how I manage our financial lives has changed.

Before getting married I made some progress -- opened my mail, paid off most of my creditors, and got on a payment plan with the IRS. But geting married really kicked things into gear. I'm keeping careful records of every dime we spend and every bit of income we receive. We're setting financial goals and keeping them. I'm learning about finance, and I'm making good progress on my own road to financial competence.

I'm coming to realize that my father's financial philosophy -- save every penny, spend wisely, and only use credit to buy a car or a house -- was right all along. It's hard to believe it's taken me this many years to realize that.

I'm incredibly lucky in a lot of ways. I have the benefit of experience -- I've made every financial mistake there is, and I'm learning from them. I'm young enough that I still have time to fix my financial errors. I've got a career that keeps me employed and well-compensated. I've got a wife who shares my financial goals and my enthusiasm for becoming financially stable and competent. And my wife and daughter fill me full of joy and keep me motivated to take care of them.