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Tough Love

Written by Debbie Eldridge, Client Services Operations Manager

It’s always wise to learn from the trials and errors of others, but some lessons in life are learned the hard way.  No matter how much we glean from the experiences of others, we still think we are the masters of our own little universe and know what we are doing.debbieeldridge

Well, hindsight is 20/20 and I’ve learned tough love when it comes to personal finances.

As a child, I always saved any allowance or birthday money I received. I thought long and hard about how I would spend my newfound “wealth” and I knew that once the money was gone, I would have to live with my decision.

As my teen years came along, I entered the workforce and suddenly had more money. My, oh my, what could I do with all that money? I took that minimum wage check and bought anything my little heart desired. I would spend, and spend, and spend because payday was only a week away.

If only I could travel back in time and give myself a lecture on the wise use of money and how to start saving it.

How did I lose sight of those frugal childhood years and become blinded by dollar signs? It makes me think of lottery winners who end up filing bankruptcy and everyone wonders what happened.

Did I learn to be more financially responsible? Sadly, the answer to that question is “No” because all of the stores that I loved to shop at had their own credit card. That was amazing!  They would never approve me if I couldn’t afford the payments right?  Wrong.

And so the downward spiral continued until I had a rude awakening. I realized that my debt was almost more than my income. At the time, I was in college and was just transitioning from retail work to my new job as a teller at a credit union. I needed to make sure I kept my credit record clean to keep my job. I decided to apply for a credit card at the credit union and transfer all of my store credit card balances over.

What happened next has forever changed my view of spending.

I was denied for the credit card, but that isn’t what changed my view. I was invited to a meeting with the Branch Manager Countess Saffold. She took the time to review my credit report with me in detail and to explain to me exactly why she had no choice but to deny my application.  She explained how the credit card debt affected my score and why the score was important.  She put together a 6-month plan with very specific steps on what actions she wanted me to take in order for her to be able to help me in the future.

She showed me tough love.

I followed her plan for 6 months and diligently made payments to the credit cards and other debt. I also stopped spending money on items that were not true needs. I buckled down and only allowed myself the treat of $5 for eating out lunch on payday. All other income went directly towards expenses and debt.  That was a long 6 months.

I re-applied for a loan at the end of the 6 months. This time Countess advised me to apply for a refinance on my car because I had enough equity to pay off the remaining credit card debt and the interest rate would be lower. The terms of approval for my loan were having the credit union send the payoff checks directly to the credit card companies with a letter signed by me requesting the cards be closed. This showed more tough love, but it helped me become financially responsible as a teenager.

I paid that car loan off in two years and didn’t allow myself to have a credit card for over 5 years. I never wanted to go through that situation again. I can’t even begin to explain how much financial and emotional freedom being debt free gave me. I learned to save money. I started investing in my retirement.

Although I have one low interest credit card, I do not carry it with me. I have learned that if I really want something, I will have to take the time to save for it. I have a written budget that I follow, and I still keep a checkbook ledger for the accountability factor.

I live beneath my means intentionally.

A few years ago, I determined that it was time for another vehicle since I would be traveling more for work. I decided to finance the vehicle and had my lender pull my credit report. What I heard next made my day. They said, “Go pick whatever you want and just let us know what you bought and how much you’d like to finance.” 

I’ve come a long way since those early years, and now I’m a proud homeowner. I am SO thankful that someone took the time to show me tough love.

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