A reader writes:
Our household’s recession started a couple years earlier than the one now affecting the world economy. But it was a microcosm of the problem facing the US now.
My wife and I had a relatively brief courtship, maxed out a few credit cards, and headed off to Vegas to get married. Because my moderately high paying IT job was working me to death (still does, actually), we could only get one weekend off for the wedding. So we spent like sailors knowing that a proper honeymoon would not be in the cards for us.
We get home and a few months later, my new bride starts experiencing various health issues expensive health issues that require lots of expensive tests. Eventually, she’s unable to keep up with her hectic nursing job and has to quit. Our credit is maxed, our income is roughly halved, and we have crippling medical expenses piling up. But, in true American fashion, we press forward without a dramatic altering of our living expenses or adding income. No sacrifice necessary, I tell myself, this too shall pass.
Only it doesn’t. It takes well over a year before she’s even able to think about work again, and her health won’t allow her to go back into the field she left. The debt continues to pile up and we default on most of our credit cards and various lines of credit. We actually get hooked on payday loans. Our credit is ruined and bankruptcy is not even an option, since my wife filed for it before we even started dating.
As a child of addicts, I’ve been around a lot of people in recovery programs. They always talk about needing to find your “rock bottom” before you can acknowledge you need a change. We had hit ours. So about 6 months ago, my wife is finally able to find work, making less money, but at least it’s something. I find a 2nd job on craigslist, down the street at a liquor store in the evenings and on weekends (and yes, business is great in a recession). We wring every little expense possible out of our budget and actually find a way to move into a bigger place for less money where we can live more efficiently and learn how to live on my primary income alone. All other sources of income go to savings and debt payments. When our stimulus checks came last fall, we socked them away. Same with our tax returns and we’ll do the same with all future windfalls. My wife will be back in nursing school this fall, after which she’ll probably make more money than I do. I’ll be updating my skills along the way also.
In other words, fiscal sanity has been restored and we have a plan for the future. It’ll be long, hard, and will pretty much suck. But we’re just now 30, so we’ve got plenty of time to fix this and still do everything we planned to do with our lives. We’re in well positioned industries, IT and Healthcare, to ride out this recession. Hell, even my 2nd job is remarkably safe given people’s penchant for the sauce in tough times.
We never had a mortgage, but it’s hard not to see our attitude towards credit, spending, and general fiscal responsibility reflected in the rest of the country’s behavior. I don’t know where everyone else is in there journey, but we finally have our plan and are in the process of digging out. I think we’ll be looking great in 2-3 years. We’ve already learned how to live entirely without credit cards. A habit we intend to continue even after we’ve repaid our debts. We’ll be more educated, make even more money, have substantial savings accounts built up, and be in the habit of frugality. That sounds to me like America as a whole emerging from the Great Depression and WWII.
While I know we’re not the only ones with stories just like this, I really hope we’re not the only ones who feel like we’re on the road to recovery.
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