A Financial Literacy Wake Up Call

Have you ever heard of the website YNAB? The acronym stands for You Need a Budget. When I first heard of it, I was torn between two thoughts- "what a quick, clever and memorable name!" and "a budget, who, me?" Needless to say, I'd much rather keep on thinking Thought #1, but only paying attention to what is interesting to me, at least for the moment, has left me falling short in some really critical areas, including, you guessed it - money. Budgeting, financial planning, saving, investing, retirement planning. Ugh. Just typing these words has me glazing over and my eyes ever so subtly tempted to roll.

About a decade ago, my financial advisor (I did eventually get one of those, but don't be overly impressed, keep reading...) told me based on my financial assets at that time, I either needed to hope I'll die within a year of retirement or keep working until I'm 93. I actually laughed out loud, not exactly in his face, but in that vicinity. Silly me, I genuinely thought he was telling a joke. His grim expression told me just how wrong I was. Not only was he not kidding, but he also wasn't exaggerating. If I kept on with the earnings and goals that I had at that time, I would need a windfall or a very long, very healthy life so I could keep working until I simply keeled over at my laptop.

Dan, the dear man, is still my financial advisor. He probably doesn't really understand me, but I know he likes me and he genuinely enjoys helping his clients invest and make money, whether they are small fry like me or ballers like some of his high net worth clients. I'm doing a little bit better than I was then, but not because I changed my ways and learned all about money and budgets and financial planning and made changes accordingly. It's simply because I am no longer a single mom with three kids at home and have been earning more in the last ten years than I had been prior. I told you not to be overly impressed.

You would think a stern warning like the one I got would be a wake-up call. You'd think that I would immediately change my lifestyle, embrace total austerity and fall upon my knees before him, begging him to take me on as a disciple and show me The Way. But if you think that, you don't know me very well. I am an eternal optimist, especially when I have absolutely zero evidence that there is any hope to be had whatsoever. There just seems to be something about having your back up against that wall that truly brings out our creativity, problem-solving skills and ability to handle our emotions in certain types of crises. And my back wasn't quite there yet.

Let's just hit the pause button for a sec. I realize as I scan back over these lines that I might be giving the impression that I've accumulated a mountain of debt and have been living like some kinda wanna-be-a-Kardashian, complete with thrice-weekly blowouts and Louboutins. Uh no, and no. I've never even had a blowout. I wear nail stickers instead of going to a manicurist, stay in the cheapest Airbnb I can find instead of the conference hotel when I travel for work and have never flown first class in my life. I got an upgrade to business class once or twice and I really enjoyed it, but I never felt entitled to a particular standard of living. I guess you could say I was comfortably middle class.

I have been lucky in other ways. My grad school education was paid for by an academic award, after being nominated by my professor (thanks, Dr. Maki!). While I only received the bare minimum in child support, mainly because I was too proud to seek more and didn't truly understand the cost of raising three kids on my own, I was able to buy a two-bedroom condo in a good neighborhood as a single parent. I also managed to put all three of my kids through college, completely on my dime. Fortunately, they all didn't go at the same time. I will always be extremely proud of those achievements, even though I was unknowingly digging my own financial grave at the time.

Not having a plan, a budget or anything more than a passing knowledge of personal finances, I have been truly lucky to get as far as I have in life. I've always had a strong drive and a great work ethic, so eager to have a job that I was the first kid in line for a worker's permit when I was 15 1/2 before I could even drive. I worked right up to the day I gave birth, all three times and went right back to work just as soon as I could. I've helped two husbands (I've been divorced and remarried, not a bigamist) start companies and I've been self-employed for the past ten years. I am proud of my accomplishments and my drive, but in all honestly what I didn't know about money has hurt me, big time.

If I had made even a little more effort to understand the basics and act on them, I'd be sitting pretty instead of a little bit scared about the future. The truth is that if it wasn't for my extremely conscientious husband, I'd be up shit's creek without a paddle, and it all comes down to one very important fact. Even if you can afford to support your current lifestyle, whether that's a private school for the kiddos or being a frequent flyer with Stitch Fix, Soul Cycle or Starbucks, if you aren't saving adequately for the future, you're living beyond your means.

Living beyond your means is not restricted to people who have to dodge calls from collection agencies and hope the car doesn't get repoed while they sleep. You don't have to have a mountain of student loan debt or maxed out credit cards or a second mortgage. Living beyond your means simply means that if your income stopped tomorrow, usually the loss of a job, you have no cushion to tide you over until you get another one without going into additional debt. And, it usually means that like me, you'd either need to die within a year of retirement or keep grinding away in that god-forsaken cubicle until you're 93.

So, here's the moral of the story kiddies, if you're still with me. Don't be like me. Don't just wing it and hope for the best. Don't maintain the delusion that you're doing great simply because you pay your credit card bill in full each month. If your lifestyle does not involve saving for the future, you're building your life on quicksand. Just start now. And get some help to set things up and maintain them. It's just not human nature to think about the future, especially when you have an in-the-moment- brain like mine.

You won't be doing it because it's exciting or novel or has a sense of urgency (the things that usually get us to take action). You'll do it because you are taking care of your future self today. If you can find a sufficient motivator - especially one that makes you proud or taps into your core values, so much the better. Maybe you have a bucket list item of taking a trip around the world with your spouse after you retire. Maybe you want to build a log cabin on a piece of land. Or maybe you want to be able to put your grandchildren through the college of their choice. Or donate to a charity or nonprofit whose mission you believe in. Whatever lights your fire, tap into that ignition energy and get started now. Once you put your financial future in your viewfinder, everything changes. But it won't get there on its own. YNAB indeed. Your future self will thank you.


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