4 Good Decisions That Brought Me to My Financial Knees

Posted on December 20, 2007
Filed Under debt, plan |

I have been reading The Simple Dollar. Trent has a series of posts on 31 Days to Fix Your Finances. Day 2 was on goals and it really made me stop and think. I needed to sit down and figure out how I got in this mess, so I could decide on my goals to get out of it.

So after much thought, these are the four decisions that have had the most impact on my financial situation. None of them normally would have made such an impact but timing and luck played havoc. Looking back, I am not sure what I could or should have done differently.

Sell my house. Normally this would not be unwise but in the current market, it turned out to be a poor decision. I was in over my head due to job changes and needed to do something. First of all, it was on the market for a year before I found a realtor who understood the market and told me what I needed to do. Reduce the price drastically. Ok, this would have been ok. We decided on a price that would still enable me to buy a property in my chosen location and restore my savings which had been dwindling.

Move to more rural area: This was also not initially a bad idea. The cost of living was 30-40% less than the area I was living in and the plan was to either pay cash for a house or sock enough money away in savings that I would have some reserves. When I re-listed the house, I had a full price offer in 7 days. Made an offer on a property in my chosen location and was accepted. All is as it should be, right?

Two days before closing on my house, the purchasers’ loan fell through. They had felt the need to purchase a new car and could no longer afford the payments. I was half moved into the new house. Did I move back or trust fate and my realtor to bring me another buyer? I trusted fate. Bad decision. After 2 more full price offers with pre approved purchasers and 2 more loans that fell through at the last minute, I was supporting 2 houses on less income and rapidly losing my grip. My credit card payments fell behind as I struggled to make double mortgage payments.

I finally accepted a cash offer that barely gave me enough to make the down payment on the new house but at least it was a solid offer and a quick closing. So much for using the excess equity to pay off my bills and make some minor improvements and re-establish my savings.

Sigh….

New Career: During this time, I had left my position at Intuit and gone to work as a dog groomer. Much less stress and I loved doing it. My income was a little better and I could transfer to a location close to my new home. I checked out the new shop and they were booked up weeks in advance. Sounds like a plan, eh? Would have been great except that the new shop I transferred to went on a hiring spree just before I got there and there was not enough business to support the employees. Groomers, like hairdressers work on commission. So here I am, 2 mortgages, a 50 mile commute and income that was barely meeting the rising cost of gasoline.

AHHHHHHHHH!!!

New Business: Well, timing is everything and in the midst of my silent and not so silent screaming, I decided that I would start grooming a few dogs at home. I put an ad in the paper and started a blog. A local groomer saw the blog and offered me a job. WOOOO HOOO… it was only part time but it was a start. To make a long story short, she mentioned that the shop was for sale. After some hard thought about bad timing, I made an offer on the business and became the owner on September 1, 2007.

So here I am today, on the road to financial recovery. The business is doing better than expected but it’s still going to be a few months before I stop having too much month for my income. For me, the debts I have are small but just as painful. Frugality has become a necessity and getting my financial self in order a priority.

If you enjoyed this article and would like to learn more about me, please Subscribe in a reader

You Also Might Enjoy

If you enjoyed this article, you may want to subscribe to my feed by RSS or get updates in email.

Comments

3 Responses to “4 Good Decisions That Brought Me to My Financial Knees”

Budget Review for February | Oh My Aching Debts on March 6th, 2008 1:28 pm

[...] It’s been awhile since I have done an actual budget update in cold hard dollars and cents. Many of you are new here and if you have not read how I got into this mess, you can read it the four good decisions that brought me to my financial knees. [...]
Jungleswife (5 comments.) on April 21st, 2008 3:43 pm

Sorry I didn’t read this before I mentioned downsizing in one of my comments. *My face is red* You have been through alot! Life sure can be frustrating. Decision making is hard enough, but experiences like that - and I have my own list - sure make it hard not to second-guess everything.
cindys on April 21st, 2008 5:48 pm

Jungles Wife, Downsizing was a good suggestion even if it’s not possible right now. No need to have a *red face*. I have to admit that I have considered an apartment pretty seriously in the last year. LOL… Maybe even an old folks home….