How I squandered my financial fresh start. . . .

New here? First read The Early Years, and then The Middle Years. . . .

Once upon a time, almost two years ago, I was debt-free (except for my student loan). I sold my house in California (just a wee house, in a rural part of the state---so my ‘take’ was less than $50,000 after three years of ownership). With the proceeds, I paid off my car, my credit cards, and my home equity loan, leaving me with about $15,000.

I took a giant breath and moved to Portland, Oregon, to start a new life and a new job (at a lower salary---but hey, I was debt free, remember?). Somehow, I now find myself once again a slave to credit card debt, saddled with a mortgage that is probably too large for my salary, and with over $50,000 remaining on my student loan. How did this happen?

I was so unused to having money in a savings account---an actual cushion! It felt so great, I was loathe to spend any of the money on piddly, every day stuff. So I used my trusty credit card when I visited Target, Home Depot, and Bed, Bath & Beyond, knowing that I had the money to pay it off every month----which I didn’t. Pay it off, that is.

I then used much of my remaining ‘house money’ to purchase a house in Portland---now, granted, the home I live in is even smaller and cozier than my California house, and cost less than the sale price of my California home----but it cost over $60,000 more than my first house originally cost, and with me at a lower salary than I was then, the mortgage payments now seem almost overwhelming. And of course, you know what happens when you move into a new house or apartment, especially if you’re an ‘owner’! There are needs, after all! More trips to Target, Home Depot, and Bed, Bath & Beyond----adding to my creeping credit card debt.

Each month, as I continued to live as if I hadn’t just bought a more expensive house on a lower salary, I would take a little here and there out of my savings account, to cover dinner out with friends, or the electric bill that came due at the end of the month, or the auto insurance premium that I hadn’t thought about until the day it arrived in the mail. And so it went. Until my savings account was so meager I began getting nervous. Which was a good thing, because that anxiety caused me to re-evaluate how I was living, and most importantly, how I was spending.

I think the combination of ‘starting fresh’ two years ago, a new outlook on life---free of credit card and auto loan debt, after all---and actual money in my savings account served to create a false sense of financial security. I bit off more than I can chew---almost. I am, after all, ‘making it’, as they say. I am paying my mortgages and other bills each month on time, and I’m even finding ways to pay off my credit cards---for the last time.

I now realize that I squandered what could have been my ‘financial fresh start’. I can kick myself for letting this happen, or I can learn from it---I choose to learn.