A Friend in Need: Love and a Financial Lesson

Someone I know is in serious debt. We’re talking to the tune of $150,000 or so.

It doesn’t sound like a lot at first glance. When you consider a house can cost three or four times that, owing that much on a mortgage might not be so bad. But this debt is the result of student loans, credit cards, mortgage and boat payments. My friend works, as does her husband. They have children, and the usual expenses that come with raising them: daycare, school activities, entertainment, plus food, clothing and medical care. It hit her quite hard recently that things are not good financially. At one point, they had debt of under $10,000. As my friend put it, “We aren’t behind, but our income isn’t going to support this for very long.”  

What happened?

Life happens, certainly. Emergencies appear, responsibilities happen, obligations must be met. Many homeowners are in the position of owing more on their homes than they are worth, or getting stuck with more house than they need. But where does emergency, responsibility and obligation cross the line, taking your budget with it into the pitfalls of Want-This-Want-That-Gotta-Have-It-Now territory? For my friend, was it the student loans, taken out at a time when borrowed money seemed cheap? Was it the boat, bought for a spouse who assured her that this was “all the vacation he would ever need,” until he found out that a boat without fishing gear, life vests, maintenance tools, etc., isn’t fun or safe to operate.

For the record, my friend is deeply upset by this debt. Is she upset enough to do what she has to do: 

  • Chip away at the amount by cutting her budget in a lot of small ways, or
  • She and her spouse each finding second jobs, or
  • The painfully obvious: lose the boat and the credit cards and rethink her budget

I don’t have a good answer for her. I’ve been down the dreaded debt highway myself, though not to the tune of $150,000. I found a combination of several methods worked for me, but first I had to own up to the fact that there was no easy way out. No money magician, no gelt godfather, no sultan of the cash stash waiting around with a miracle. Clearing my life of money misery was actually my very first step towards My Next Life. I can only support her and offer my experiences, and hope she gets something from it.

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Filed under budget, Relationships, Uncategorized

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