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August 19, 2005

Real Women bring home the bacon. And/or wine.

Signed, sealed and delivered: One divorce agreement, one check for a $1000 towards my lawyer's bill, and one very soon-to-be emancipated woman.

Coincidentally, today is exactly the one-year mark since Mr. X announced he was moving out. In that year, I have managed to stop bawling at my desk, stop smoking (so far, so good!), start writing stuff, discover the durable love of battery-operated devices and Face My Debt.

(Hi Dad! All the battery-operated flashlights are working great!)

Of all the things I have accomplished this year, I am most proud of getting my finances under control. For the first time in my entire life, I believe that I can live as a grown-up, a real woman, one who brings home the bacon and puts it in the fridge. And then has a glass of wine and feels FANtastic about bringing home that bacon.

Prior to the marital meltdown, I was a complete money moron. But now I have reformed! Mostly this is my control enthusiast side kicking in -- I know I can't control when stuff catches on fire, or when I'll bump into Mr. X, or when the spontaneous belts and hoses and radiators break on my car.

But I can control my money.

I can develop a plan, and have a goal. (In fact, my ONLY financial goal this year was... well. To develop a financial goal. Task solidly accomplished!) I tell ya'll this because maybe out there -- somewhere -- is another girl like me who wants to hide in the closet and eat Oreos every time the credit card bills arrive. Or go shopping. Because we all know the best way to tackle your finances is to SHOP THEM AWAY.

(And by "you" ... I mean "me.")

Because I AM A CAUTIONARY TALE. And if I can get a handle on my finances, what with my love of shopping and hatred of math and general ignorance of all things fiscal, then any human on the planet can do it. Really. And you know I never shut up and can't keep all this good hard-earned knowlege to myself, so here is what I have learned so far ... all summed up in five easy pieces. It has a pretty creative title, too.

Stuff I Learned About Money (so far)

1) Never ever EVER lose track of your money.
So, hi ya'll! I was married. And in my fantasy life, I had a Barbie/Ken marriage and Ken was a Man (debatable, but still) and therefore imbued with the Ability To Handle Money. For years I worked and shopped and let Ken do all the manly money managing. Well! Not only was I wrong about Ken's personal predilictions, I was also wrong about his money-managing talents.

Bottom Line: While it is tempting to have someone take care of the adding and balancing and so on, never NEVER cede your personal financial power to anyone. Think about it this way: You wouldn't let anyone, not even your one true love, take total control of your yarn stash and do with it whatever he/she wanted at any time. Would you? Then why on earth would you let anyone have control over your finances?

2) Figure out what you owe.
Can't speak for all ya'll, but I was too scared at first to even know HOW MUCH DEBT I had. Sure, I had a pretty general idea ("general" meaning "a whole lot of debt" and "maybe I will cry" and "is there any ice cream?") but I did not KNOW the actual AMOUNT. And ya'll, that is sad.

Bottom Line: Write down every bill on a piece of notebook paper. Or use my Excel budget (it's pink! makes it less scary!) Add it up. NOW YOU KNOW.

3) Figure out what you make.
This should be pretty easy. Write down what you bring home for the month. See! Not too hard! You did it!

4) Spend less than you make.
Um, again. Things I have had to learn that most people KNOW, yet me? With the hoarding habit and shoes and cats? Had to LEARN. Anyway. Moving on. Spending less than you earn will always be a smart goal, even if you make a bazillion dollars. Because when you spend more than you have, you're poor. You're endebted. You're unable to quit your job and join an alpaca herding community.

Bottom Line: Track what you spend. Ya'll know that diet trick, where you write down every potato chip and carrot stick you eat? Treat your money the same way. Track it. Understand where you can cut back. And then, ya'll know, CUT BACK. You can use Quicken, your check register, a Word doc, a sticky note, or the back of a napkin. But figure out to the penny where the hell your money is going. (After looking at past receipts, I discovered I was spending $40 a month on MAGAZINES for chrissakes. That was embarrassing.)

5) Pay off your debt.
I have massive consumer debt. MASSIVE. I'm still paying off my lawyer! But I have a plan now, one that involves calculating my balance and figuring out how much I have to pay each month to be FREE of debt in 24 months. Me! FREE! And when I say "massive" debt, I mean ... GNP of a small country. I could cry sometimes.

I have had consumer debt since I was nineteen years old (coincidentally that's when I got my very first credit card). Every day since then has been a payment. My paycheck, my life ... it's all tied to a bill right now, and being free of that is my greatest achievable goal.

Bottom Line: You have to stop taking on more debt RIGHT NOW. This minute. DO NOT CHARGE ANOTHER ITEM. Research debt reduction online. Read what the experts have to say. Google "debt repayment." Find ways to lower your interest rate. Cut down on the Starbucks or movie channels or magazines, whatever you can, for a 3-month period and use every penny to pay off your debt. Wash, rinse and repeat for another 3 months ...

In Conclusion...

There you have it, those are my five Cautionary Tale pieces of learnin' when it comes to money. I don't know a lot -- let's be honest, until a few weeks ago my savings account was an old butter tub in the vegetable crisper -- but I'm learning. I think it's a lot like knitting a sweater: you can only accomplish it one stitch at a time. So, I am slowly becoming a financial grown-up ... one dollar at a time.

Posted by laurie at August 19, 2005 1:13 PM