I’ve got a story for you that is about something really pedestrian, but it’s illustrative of how we can get so focused on some things that we forget the big picture.
Yesterday I bought a car.
And not just any car. It’s an almost-new car: A 2015 Ford Mondeo hatch/wagon. She kicks like a beast and grips the road like a race car. (And yes, in case you’re wondering, I did take her out on the open road today ahead of skimming around hairpin bends at high speed on the way home. May the gods bless my get-your-license instructor who, on realising I could already drive well at the tender age of 17, taught me how to drive defensively.)
This car handles like a pro and for a driver like me, is nothing short of Really Farking Exciting, and I want to tell the Entire World how brilliant it is.
Ahem. Back to the story.
I had enough money to buy the car in cash.
Which, really, wasn’t that much in the scheme of things. Like, $16,000.
But, like many conscientous women who are great at keeping the home fires burning, did not have a credit rating.
Making the decision to borrow $10k became an interesting psychological battle.
In fact, if I’m completely honest, making the decision to buy a car in the first place was a big deal: Cars are expensive, money-sucking things that serve only to get you around the place a bit more easily. But on top of that, I have had a very serious Debt Aversion.
It that Debt Aversion exists partly because of how my money patterns were established.
This Debt Aversion means that:
I don’t have credit cards
I don’t have any debts. (Unless you count HECS, but who does, right.)
The salesman in the dealership was gobsmacked.
‘What other loans do you have?’ he paused, hands suspended over a keyboard.
‘None,’ I chirped.
‘No car loans? Home loans?’
‘Nope,’ I replied.
‘Really?’ He frowned. ‘No loans at all?’
‘That’s what I said,’ I threw back, impatiently.
‘What about credit cards? Store cards? Other liabilities?’ he pushed.
‘Nothing. No loans. No credit cards. No store cards,’ I returned evenly.
‘Holy moly.’ His hands dropped, his eyebrows hit his hairline, and he whistled to himself. ‘Well let’s see how we go.’
Despite having been renting in the same location for the past five years; despite having grown a company from a fistful of dollars to something that’s looking to hit over $127k this year; he was skeptical that I’d be approved quickly.
But of course I was.
And I, meanwhile, was running a program of pattern interrupts on my monkey mind.
Every time something came up in my inner chatter about owning a car; about having a debt; about owing somebody something apparently so massive; I batted it away. Initially doing this using the word ‘no’, it got stronger. So I discovered pattern interrupts like feelings of excitement, or even actual laughter, to stop it.
Having lived the first 10 years of my independent adult life in an undesirable relationship; one in which I did all the earning and never had a cent to play with; and having perceived my life as Struggle Town for so long, getting into this situation was challenging, to say the least.
It turns out that that old relationship had created a deep-seated belief in me that I was rubbish at handling money. My partner didn’t work; I did. I paid the key bills (rent, utilities), and then he took the rest of the money and did the shopping etc. I never had a cent, always believed that this was mostly my fault. Actually, it was because he didn’t work and never encouraged me to learn how to handle the full breadth of household expenses.
Thus, when that all ended and I was relying on my parents for my rent at the age of 30, that belief persisted. Once I had a job and was financially independent, I became obsessed about tracking every cent. The very topic of money was deeply emotional, surrounded by guilt and fear.
For years, I scrutinised my cashflow and budgets every Sunday.
I read my balance sheets like an accounting autist with nothing better to do.
Eventually, I got my head around a budgeting sequence that made sense for me, and worked without fail. That’s when I became The Accumulation King.
It’s pretty hard to accumulate a red cent when your personal wage is $2,100 per month. But even out of that, all my bills are paid, I eat, and I indulge a dance habit. I’m sure that if I didn’t dance, I could be saving another two grand a year.
Earlier this year, a friend who did some cashflow work with me for free exclaimed:
‘You just paid $15,000 in taxes and didn’t even blink! You have way more money than you think you do.’
So you see, darling friend, the loan is nothing.
If you buy a new car, your debt is much closer to $30k.
If you buy a house, it’s hundreds of thousands.
Yet here I was, on the brink of borrowing a piffling $10k and realising my own limitations.
And then one day last week, my dad told me a story.
It was a story that he was told by an older colleague, when my dad was a young man.
Here it is:
‘Bob and Mary are rubbish at saving money. Bob and Mary are fantastic at spending money. And when they owe money, Bob and Mary are brilliant at paying money back. You will only get so far by saving and spending what you save. But you’ll achieve a lot more if you’re willing to borrow and repay quickly, and on time.’
Dad’s story hit home.
I think you can get really caught up in the idea of doing everything on your own, especially if you’re a stubborn and fiercely independent woman like me.
You can become very proud of that accumulating balance in the bank.
You can get very guarded and unsure if you are required to use it for something personal.
There is a lot of pride in it for me. I started my business with such a small volume of money. Every single cent that I have earned and spent, I have done so under my own steam. Nobody helped me earn it. I did it entirely on my own.
So the fact that I could take $16k of that money and pay it in cash was a potential moment of immense pride.
Look at what I can do, because of my own grit and talent, without anybody doing it for me; and this fancy-ar5e car I bought in cash.
Unless you’re in a financial business, you can forget the huge risk of not having been the recipient of a loan.
If you’re in your 40s and you don’t have a history of loans and repayments, life can disappear without you ever gaining such a history. Once you get to your 60s, then if you have to borrow money, nobody will give it to you.
It’s the ultimate paradox: The very reason why you’re extremely low-risk is also the reason why the system locks you out.
So what is your key takeaway today?
Don’t get so proud of your own work that you start tripping on the robes of your pride.
When you can build an infrastructure around you in a smart way, you should do it. And if you don’t know how to do that, ask as many people as you can until you find someone who can shine a light on the things that society is not interested in teaching.
And the spirit of money is more helpful than you think.
Though, I feel that that story—about the spirit of money—is for a day when you and I are sharing a meal, rather than merely communicating through letters.
~ Leticia Mooney