What if the Recession never happened?
March 21, 2011 12 Comments
Two and a half years ago I was a mess. I had no savings account. I had no emergency fund. I spent every dollar I had and then some. My credit card was maxed. I “got by” on fortuitous gifts of money from family. Every dollar I got I spent just as soon as it hit the checking account. Mostly because I had gotten myself so deep in to debt that each dollar went to debt payment before my paycheck could even clear.
I had to open up a new line of credit for every emergency, simply because I didn’t have any cash to pay for any of these things.
My only back up in case of hard times was about $25,000 in stocks and mutual funds that I hesitated to touch.
A great thing happened to me about the point where I had maxed my credit card, taken out 4 other lines of credit, and would finish up the last two weeks of each month with maybe $20 for the entire two week period because of my debt: The Recession.
I know that most people probably think of the down turn of the economy as a terrible thing to happen. But for me, financially, the recession was in fact the single best thing that could have happened. My stocks and mutual funds took a huge dip and suddenly I didn’t have enough money in them to pay off my debt anymore. My $25,000 in investments were now only worth $13,000 (and dropping).
Realizing I was worth less than I owed scared the crap out me. And I began to reconsider how I viewed money.
Anyone reading this blog for a while knows that this journey hasn’t been easy and it hasn’t been quick. But I’ve been able to save large sums of money for my emergency fund, to move, for a wonderful vacation with my grandmother. And best of all I’ve started to actually turn myself around.
When I started this blog I was “worth” a negative $18,779 – and went another $2,000 lower in the 3-6 months that followed because of the economy. Two and a half years later I’m approaching the $0 mark (I’m currently at -$2,932). This is a huge amount of change on my part.
I know that recessions are supposed to be bad things. I know that I’m supposed to hope for economic growth and recovery. But this recession has been the best thing that ever happened to me. I was forced to take control of my finances. I was forced to face my debt. I was forced to change my lifestyle. And I’m so glad that I did.
What if the recession had never happened? I wonder how long it would have taken me to figure all of this out… if I ever did. How much more debt would I have gotten before I finally caved? A lot more I’d imagine. A lot.