Money, Debt and Stress

By on February 1, 2014

By Lynn Hayes –

My school district offered the services of a financial advisor, and I visited her several times before deciding to retire.  After teaching ten-year-olds for 35 years, I was looking forward to depositing my alarm clock in the Goodwill bin and hitting the half-off sales on a Monday, before the weekend crowds. I had never made any major purchases, considering myself not only frugal (okay, cheap), but also being lucky enough to rent a small home from Mom. When our lovely mother became suddenly ill, my sister and I took turns spending long days and nights beside her bed in the hospital.

Immediately after the funeral, we received papers from the Probate Court, demanding a portion of properties, goods, and precious belongings be distributed among long-lost relatives and “petitioners” whom I had not seen since Christmases in my early childhood. We were forced to sell Mom’s house for pennies, the proceeds to pay our attorney and court costs, and I lost my home to a relative who convinced me I’d get nothing for it on the open market.

My finances consisted of my retirement benefits, a few years until Social Security, the little bits of cash from the sale of the houses, and an IRA or two.  My sister decided to relocate in the north, and I headed south, where I was informed I could certainly get a mortgage on a nice little place of my own.   I was convinced I had enough savings, but I had no idea that house prices vary so widely from state to state.   My former home was worth a million to me, but less than 100,000 to someone else. It seemed each house I found wanted three times what I’d expected to spend.  So,  I signed on the dotted line for a 30-year mortgage and wondered whether I’d still be alive when I was finally mortgage-free.

I needed to rip up old carpeting and paint, and I ended up flashing a credit card or two every day.  I received offers for another credit card – since, I suppose, I was becoming known in the credit circles as an easy mark – and I built up quite a large debt. This worried me, since my teaching credentials were not accepted in this southern state unless I invested in more classes, and I was, after all, officially retired.  I got by with part-time work in jobs I had fought to get away from years ago.

On television, the highly-paid consultants suggest ways to get out of debt by getting yet another credit card, this one at a very low interest rate, transferring all debt to that card and concentrating on paying it off. What they seem to forget is that a person who has a lot of debt and not that much income does not qualify for low interest rates in anything.

In fact, this is what I see as the problem facing middle-class baby-boomers today: we’re looking at all these “deals” – low finance rates on mortgages, leasing a car for under $300 a month, no money down, and reverse home mortgages where you pay nothing and live for free.  None of those programs will let you in, if you don’t have the income upfront.  If I had a large income and a 700+ credit rating, I would not need a lower monthly mortgage payment or lower interest rates on my credit card.  I’m in the middle so I don’t qualify for federal assistance, and I’m snubbed by those who have the power to lower my monthly payments.

Let’s talk solutions: Hard work. Just like Mom and Dad, who worked hard and never made purchases without having cash in hand, hard work is the only answer to getting out of debt.  First step, stop using those cards. Make the part-time store clerk job or full-time receptionist or Wal-Mart greeter income cover daily needs. Second, save. No matter what you believe you must buy, including that new coffee table so you can put your feet up on it at the end of the day and fall asleep on the couch – first put money into a savings account.  Next and this is the hard part, follow the advice and pay more than the monthly minimum on each account – you may end up throwing out that credit card in three years instead of ten.

You will miss the nights out with friends. You can stay home and wait for that sweepstakes fellow with the flowers to deliver your check, and at least you’ll begin to see the light at the end of the tunnel. The good news – The stress will subside.

Lynn Hayes began her career teaching elementary school in Michigan, where she was also active in her church.   Playing the organ and piano for special occasions, she often accompanied children’s pageants at school and worked with youth groups such as the Steuben Youth Band.   When not working in her garden in South Carolina, Lynn can be found tutoring and writing short children’s books about challenges kids face and possible solutions toward a happy ending.

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Money, Debt and Stress