Excuse me, but was that you talking? Do you wake up in the morning overwhelmed? Can’t fall asleep from worry? Do you finally get rid of one bill just to have it replaced by three? Do you dread the ringing phone? Have you at least on occasion not even bothered opening the mail because it is just too painful – and hopeless? Do you have so much month at the end of the money that home ownership sounds like a sick joke? Or did you (finally!) buy a home only to realize that you’re stuck with a bottomless-pit mortgage that feels like a deadly curse with a vague promise of sometime in the foggy future home-ownership?
Are you higioo mayim ad nofesh – have drowning waters engulfed you? If not, count yourself either very blessed or very out to lunch. Click your browser and don’t waste your time here. This information is meant for you, only if you are beyond desperate, only if you are fed up of being fed up.
So, so many have written on these pages of the deep pain and frustration of not being able to pay tuition. So many simchas – and the inevitable, yet healthy tensions inherent in marrying off a child –are devoured by ill-afforded astronomical, mind-splitting costs. How searingly painful to hear gifted, passionate men and women asserting their readiness to throw away their most treasured dreams because of this mind-numbing desperation that will not go away.
Furthermore, what some prefer remains unspoken but cannot be, is this: Most divorcing couples in America list money issues as the NUMBER ONE reason why they broke up. And even if frumme have much lower divorce rates (and daven they don’t get higher and daven again that they get lower) think of the agmus nefesh and heder shalom bayis for which this culprit of debt is responsible! And when there is a weakening of shalom bayis the inevitable collateral damage is . . .children, chinuch. . .you can’t even put a figure to the damage we are doing to ourselves.
And then there is shlichus. I HATE the sick, pathetic shliach joke “a bank holiday is a shliach’s holiday”! Is that where things are in your life? That the passion and dream of the Rebbe, that the energy and zest for moving the Jewish world from shock, apathy, atrophy and incognizance to lisaken olam bemalchus shin daled yud (oh, how hearing those words uttered by such holiness! How it is enough to move a stone off my heart!) that this is not able to propel the yungeman into action as much as a dreaded “I’m calling regarding a private financial matter, can I please speak to Rabbi. . . “ phone call can? Think how preoccupied you are with owing money that your head goes clear only when you are given 24 hour respite by your creditors! What has happened to your passion? It should now be obvious: It has been deluged by debt. That is sick and that is sad. How can you possibly be creative and energetic when the only thing keeping you going is a baitch (a whip)?
There is good news and bad news. The good news is that you can change things; the bad news is that YOU can change things – and no one else, no government program, no community body, no committees, no gvirim, just you and your spouse. The good news is you can get rid of every last stinking bill in your house. You can free yourself and NEVER get a collection’s letter or phone call again for as long as you live. You can wake up with needing LESS than what you already have. You can live free of agmus nefesh of gelt-zachen forevermore.
The bad news of course is that you will need to relearn how to do things; you will have to banish bad habits from your life. You will have to become responsible in ways you didn’t even realize you have been irresponsible. If you made half the stupid mistakes that I did for years, you will be humbled like never before. It will be a gut-wrenchingly tough experience that you can only do if you are so sick of the status quo that you are ready to throw out the garbage that has been collecting on your desk, in your closet and most of all, in your head.
So many of unzere menschen express bitter disappointment that those whom they thought would, could or should cure the problem have not. Many, many people in the world at large believe the government should cure the crisis. This is dangerous: only we the little guys can clear up this mess. And you know something? When we clean it up we will not be so small: and all those looming larger-than-life figures will look like comical paper tigers.
Truth is, we are not alone: like the saying goes, Jews are just like everyone else -- only more so. The whole freaking country is up to their eyeballs in debt with homeowners, corporations, cities, counties and states waking up and realizing they are broke. In Europe several countries are. Then of course, America has enough cash flow to be in deep denial, but the same thing is happening, all of the above spend more than they make. We of course, have tuition and simchas and frum neighborhoods cost more, lots more usually. So we are deeper in the hole, and therefore we are more overwhelmed. But we have the tools to turn this garbage around.
By the end of this article you will have enough info to start changing your life but good. But your job will not be over; you will just be beginning to get your act together and will need to continue. A disclaimer; I am not a licensed personal finance counselor; I don’t even know if there is such a thing. I just know that things were getting harder and harder to handle until bechasdei Hashem I was shown what I was doing wrong. I changed and things are better, much better. I am not raking in millions or living the high life; I am however no longer consumed with money issue. A bank holiday now means that we cannot make deposits at the teller, only at the ATM.
There is plenty of good info out there to become knowledgeable about your money: I am not really here for that. I am sharing what I know, to help ignite the fire in you: show you what you are doing wrong, get you angry at your stupidity, show you how things can become good and you will automatically be pumped to get out the mop and clean up your mess, throw out the garbage and put things in order. This change cannot come from the head, it comes from the guts.
First things first. Tell your spouse you read this article and ask, plead and beg them to do so also.
Second: make a list of EVERY PENNY you owe anyone, from a $3.49 residual bill from three years ago to the 20 grand you still owe on your car. If you have a mortgage, keep your mortgage separate from this list but nearby.
Third: Look at this mess! Do you want to add to this list? If you do, get to a doctor. If you don’t want to add to this list of aggravation, then you and your spouse must now resolve to never buy something without paying for it in full before you take it home. If you don’t resolve that now, then paying all the bills will mean nothing, you will just be changing names and amounts, spinning your wheels, ruining your blood pressure, etc., etc.
Fourth: arrange this list of bills from smallest amount to largest.
Fifth: Look at this list and see if you can knock off a few of the smallest ones right now! Then get rid of them. Do you feel lighter? Imagine what getting rid of ALL of them will feel like? Imagine the day when you will have crossed out every last bill except the last one, and now you write the check for the final last pennies! How does that feel? Better than the first few paragraphs? Come back to this feeling over the next few months as you slowly but surely knock these pests out of your life, one by one, smallest to largest.
Sixth: Repeat after me the two most vital words that will either kill your relationship with your money or (re)kindle your relationship with your money: Compound Interest.
It sounds complicated but it’s so simple it hurts. Let’s say Reuven borrows 100 bucks from (well not Shimon, because of ribis, but) Bank of America for 10% interest. At the end of one year, Reuven owes, not just the 100 bucks he borrowed but also the 10% interest: $110. Assuming he makes no payment and doesn’t borrow any more, at the end of two year he will owe . . . well, he still owes the hundred he borrowed and the ten years from the first year, plus he owes 10 bucks from year two (that’s $120 so far) PLUS he owes one dollar of interest on year one’s interest (10% of $10)! So his $100 now costs $121. The third year he will have another ten bucks ($131) plus two bucks interest on interest from year 1 & 2 ($133) PLUS one dime of interest on interest on interest ($131.10). It sounds like nothing, a dollar here a dime there, what’s the big deal when we are talking about 100 bucks?? But think how much this 100 bucks is costing Reuven over a decade!
That’s why Rashi explains the word neshech for interest is the same word for snake; two little bites at your ankle and in no time your head begins to swell.
I know, I know, you’re thinking so what’s the big deal, I can always go to a gmach. Not so simple. First gmachs need to be paid back also. Secondly, life is all about habits, and borrowing money is a bad one. That is why the above scenario was illustrative for our purpose but not true to real life; in real life Reuven would need 150 in the second year, he would be a day late with a payment so his rate would have gone up from 10% to 36% (it really does that) and at some point he would have panicked and given FedEx $12 to get his check there on time – and let’s assume for now that the check does not bounce, okay?
Last week’s parsha just taught us the words with which we bentch each other every Motzei Shabbos, and everyone will owe you money and you will owe no one.
You see, if Reuven had invested one hundred dollars, it would have kept making him money on top of money. Assuming he invested it at the same rate he would have made $33.10 without even getting out of bed in the morning. Instead he lost that money, and combined with the loss of his potential income he has lost a total of $66.20! So before you spend money for anything know what it is costing you.
More importantly, if Reuven would not have spent that 100 he would have had menuchas hanefesh instead of a bill.
Recognize this (what Einstein is purported to have, but probably never, called the) most powerful force in the universe and think what your credit cards are doing to you. Oh, and by the way, many of them send you the bill on the 5th of the month and it needs to be paid by the tenth and if you are 30 minutes late in their system they charge you a $10 late fee and might even raise your loan rate from 12% to 24% or even 36%!! And they don’t even have to tell you!! It’s all in the fine, fine print on the back of the credit card application that you signed before they sent you that pretty piece of plastic.
Oh, and have you convinced yourself that you pay it off every month? Ha ha ha laughs the credit card company. They invested millions of dollars to verify, that come an impulse purchase, come r’l a loss of a job, Gz’u (that’s G-tt zol uphitin!) a machla, you will stop paying it off and your interest dollars will start rollin’ in! Remember Rashi called them a nachash, they are sly and they bite and they are poisonous.
Think about that, and do the unthinkable: take a pair of scissors from the drawer and cut your credit cards in half.
Sixth: you are on Kingston with some dead presidents in your pocket. It’s been a long day, you deserve some: sushi, ice cream sundae, nosh, hamburger. Your long-suffering spouse certainly does. Right then and there whip out your smartphone thingamajig (or pen and paper if you are over forty-five) and jot down what you are spending on these feel-goods. Add them up. See how far this is piling on that list of debts you put together. See how far these “little” treats are keeping you in debt – FOREVER! Unless you change the way you do things.
Oh no! but I can’t live in deprivation forever like this! I’m a human being, you know! I DESERVE to treat myself to a miserable little sushi or sundae, for crying out loud!
You have a point. You do deserve better. You deserve to buy sushi three times a week if you want to, thrice daily even. But until you get out of debt this sushi will be nothing but an addiction, financially killing you every day, (and very possibly killing you in other ways too, but that is not for now). Take those dead presidents and kill some bills with them instead. Get them out of your life. I promise you, sundaes taste MUCH better when they are not topped with debt.
This is enough for now, but this is just a start. Go knock ‘em dead. Get rid of debt collectors once and for all! I LOVE seeing yungeleit who take these principles and before you know it they are doing very, very well, and feeling much better too. Hit the comment button.