General Finances - How To Cope?

[Nafe]

Hi Anthony/Kerri-Ann,
Thankyou very much for your posts of support! They were much appreciated. It spurred Erin to make some posts and she felt really good after doing so. I haven't posted for a while because I just didn't really know what to say. We are still finding it hard, but are making good progress I think.
I just wanted to ask for anyones opinion who may read this on the topic of finances.
After Erin and I had sat down and talked about money for the umpteenth time, Erin suggested I maybe put a post up here and see how other people deal with it. Before I say anything, I would like to say that I realise what Anthony had said in reply to my previous post. I totally understand that money is not as important as someones life and well being, but my problem is as follows...

We have a lot of debt, which we had accumulated gradually (and some big amounts sporadically) because we could not support the lifestyle we were living roughly 14 months ago. For about a year, we continually racked up personal loans, credit cards and the like. We got into a bad habit of thinking "we don't have any money until pay day, lets extend a limit on a credit card, or lets overdraw this account etc.", this would make it even worse the next week when we had to pay it back, and the cycle just continued.

This may all seem secondary, and not really to do with PTSD, but it is a reality which I haven't seen many people talk about on this forum. We struggle each week (we probably have to pay about 4-5 bills a week, which runs us dry very quickly) and then we don't even have enough money to do a proper grocery shop, which Erin would love, because its hard for her to leave the house, and she wants to eat healthy as well.

Are we, at 23 and 24, supposed to declare bankruptcy? Every night we to talk in great lengths how we are going to manage things which just stresses us out completely. Has anyone been in such situations and how do they deal with it?

We put every bill off and until its in its final demands, and even then I'm afraid that all the companies will just have had enough and send out debt collectors to get the money which we don't have. Sometimes I think that we may have to move and do some really dodgy things to try and avoid paying this money back, but I know thats just a stupid thought and I would never do that, but it makes it so hard. When Erin is feeling (or me) really down, we just want to be able to go out and do something, but before we do ANYTHING it all has to be thought to make sure we have enough money for the next day, the dogs, bills...its so frustrating! And the situation makes us argue all the time. I know form experience that when Erin is not feeling so well, mentioning that we may not have the money, will just make the situation worse. But how can I escape this reality? We have to worry about the rent every month so far. I know that from my end I need to prioritise, but its so damn hard to make the right decisions, I don't think we can do everything.

We are coping, and I think it will eventually get better, but I just wanted to know if couples ended up in the same situation and how they dealt with it?

Thanks for listening.

 

[erin]

a little more info..

Hey,
I guess I just wanted to clarify a little of what Nath said..
I think the reason Nath is posting the money problem on here is because my PTSD does affect us financially. At times, I become so unable to cook or leave the house that we get take out that we can't really afford, or we rent movies that will cheer us up and stuff like that. We have a lot of credit card debt from these sorts of things, you know, patch up jobs to keep us sane for another day. Also, I needed a lot of maintenance last year, as I had been living like a uni student for such a long time, and hadn't even been to see a dentist for years. I needed to get some dental work done, and that costs a fair bit. I needed new clothes after I got depressed and put on heaps of weight, as none of my old clothes fit me anymore. So, of course, we went to the credit cards.. We needed two incomes, but I wasn't able to work, so credit kept us going. By the end of the year, we were so burnt out, we decided to take a holiday. I was also having a lot of trouble with Christmas coming up (I've noticed that a few people here have the same problem with holidays) and my birthday is a couple of days after Christmas, and it's just as bad. So we decided to take a break and go to Fiji. We were going to take a trip somewhere in Australia, but the fares were cheaper to go overseas! So we thought it would be a good idea. But soon we had spent over $10,000 without even noticing. Nathan's parents have drilled into him that owing money is bad, and most people would agree, but he feels a different kind of pressure to most people because he has only just started to see his parents as "people" and not just Mum and Dad, so it still upsets him that he is in this position and that it disappoints them. It's tough on Nath, because he didn't ask for any of this. I don't think he knew how far down the rabbit hole goes with PTSD, and how much it impacts on daily life. I feel like I have let him down by being so weak and unable to contribute. We're both having trouble coping with the fact that even if it was too much for Nath, or for us, and we decided it wasn't working out, that we wouldn't be able to leave each other because we couldn't afford to make the repayments seperately. We're trying to find ways to get out of this debt, but for the moment, it just looks like a long, long road.

 

[anthony]

Yep, finances certainly do cause stress, whether with or without PTSD, finances are often a topic of issue, and generally concern within every relationship. I guess the reason that finances haven't been mentioned here, is because nobody really ever posted it or asked, and secondly, finances are more a specialised area, being from a financial advisor, the same as what PTSD is within the mental health scope. This doesn't mean that it shouldn't be discussed on personal levels here, because it is part of the problem to make one's PTSD worse... so... lets talk about it I guess, and thank you for posting the issue nafe, as it is a real issue within everyones life.

How often do you hear the coined phrase, "it doesn't matter how much money you have, you always need more?" What an absolutely correct phrase that is.

At age 23 & 24, this is part of the life learning curve, nothing more really. I know at that age I had done the same... basically had more debt than I could afford, and felt a degree of hurt for it, but we generally do get past these learning curves within our lives, and providing people learn from them, then they can only be seen as positive, even though they are very negative at the time. Our life journeys teach us from our mistakes, one of which you have both fallen into now unfortunately, with the added bonus of having PTSD within the equation... ouch!

I will give you the hard hitting reality of this situation from my perspective, which I think would be pretty close to a good financial advisors opinion, as I have spoken with them often enough, and we have our own anyway to manage our investments. You answered your question yourselves, by stating you are living beyond your means. You are living beyond your income, and this is nothing new within todays society. You took a $10,000 holiday when you couldn't actually afford it, because if you could, this problem wouldn't exist today. Yes, this is harsh, but the facts as I see it.

You are both young, and both learning, and if you learn from this, then you will never fall back within this situation again. Debt is not all bad. There is good debt, and bad debt. Good debt is a home loan, investment loans, etc etc, borrowed money that is making you more money than it is costing to borrow. Bad debt is credit card interest, personal loans, any loan or financing that is losing you money. A car loan is bad debt, because cars depreciated, not appreciate in value. People turn good debt into bad debt, by paying too much for an asset, beyond its current or realitic expected value, thus turning possible profit into liability.

Todays society and the impact of marketing is also creating this problem beyond reasonalbe proportions. Mobile phones on plans with nothing to pay upfront, free this, no down payment, 12 months interest free, etc etc... all bad purchases and debt.

I would say this to you both. If you are serious about getting yourself out of debt, then stop making silly decisions with liabilities, and get control now to earn yourselves wealth.

You need to itemise your bills, from my experience, and start really looking at what is essential vs. non-essential and can live without. You need to itemise your debt, and establish what is achievable to payoff within the immediate future, and what is not.

I will say this. Don't be scared of lending institutions, because they want their money back, and are prepared to make satisfactory arrangements to lower installments, just cover interest costs for a timed duration, etc etc, to help you get out of debt and continue paying them the money you owe. They are not bad people, as many perceive. You need to talk with them, and come to arrangements surrounding your situation. Don't bullshit them and give them big stories about your life history, because all they care about is getting their money back, and they would rather get it back than have you ruin your own life by declaring bankruptcy or something silly like that. Bankruptcy is not a light decision, because even though it has a time span till your clear it, and think you can start over financially, it doesn't just negate all your debt because you filed for it. Bankruptcy doesn't work that way. Bankruptcy remains with you for life, which means you will pretty much shoot yourself in the foot for buying a house, even in ten years time... it will put you within a lifestyle bracket and never let you out. Absolute last option.

1. itemise all your bills
2. total all your income
3. basic living expenses come first
4. remove all non-essential items within your life
5. develop a plan for repayment
6. phone all companies you owe money, and discuss your plan with them, and how can they accomodate you for a window period. They may play hardball at first, but if you tell them otherwise it is bandruptcy, they generally will fit your plans you made in step 5
7. money management and budgets is key
8. if you can't afford it, don't do it, find an alternative that costs less
9. entertainment doesn't need to cost money. Go for walks together, exercise, go kick a soccer ball, many alternatives exist that cost nothing, and you get exercise as a benefit, and you feel better, and you haven't spent one cent.
10. stick by everything you come up with.
11. now... really, piss non-essentials off. Mobile phones are not essential, regardless what you think, they are not essestial.
12. you should have minimal bills, ie. rent, electricity, home phone, gas... thats it. If you need a mobile phone, get prepaid, and only one per couple, not one each.
13. needs and wants are two very completely different things. Work out which one everything falls into before spending. Needs are essential, wants are not.

There is so much more I could put here, as this list just never ends really... as each situation can be so much different.

I would highly recomment, you go seek financial advice from an account or advisor, and follow it. They will help you with the debt management, they will help you with the creditors... they will help you regain your financial life back.

 

[anthony]

Oh... forgot one thing... CREDIT CARDS ARE NOT ESSENTIAL... get rid of them all.