A few weeks ago, my husband and I began our first Financial Peace University as coordinators. It’s been awesome so far, despite my ongoing nervousness about speaking to large groups of people.
But the large groups of people part is very important. Because it’s when you have a bunch of people in a room re-learning the basics of handling money that you start to see how similar we all are… in that we’re all not so similar.
Sound weird? Stick with me. The coolest lesson I’ve learned so far is that we all have unique financial situations and the solution to all of these problems is the same. It doesn’t matter if your debt comes from student loans, stupid loans, or health crises. They all feel the same. You feel a little stupid, a little tired, and a little suspicious of people who don’t have those kinds of loans. And the solution is to find a way to make more money quickly, get a savings account together, and make a plan to pay off your debts.
I learned this lesson from several couples in our course in particular. They’re a little older than my husband and I, and their situations are very different. One couple is saddled with debt from medical emergency after medical emergency. It’s so stressful, and it feels a little unfair to have these accidents keep happening. The other couple is a little less in debt but staring down huge student loans for their children. If feels stressful, and it feels a little unfair to have to worry about this when they should be concentrating on retirement.
The answer for both? The only thing that will make you feel better again. Save. Pay off debt. Get your financial priorities in order and then take care of others. Because it’s only when you feel the peace of a financially-sound household that you can let go of that feeling of stress and unfairness.
Josh and I are still fighting Baby Steps 1 and 2 years after we started the program. But it’s reassuring to see that the solution is always right in front of us: find a way to make more money, then work together to save that money, and then put all of our resources together to pay off debt. And as we return to this process for the rest of the fall season, we look forward to seeing what kind of progress we make.
Sarah, it’s good to know that you learned from other’s experience. This is actually a good way to avoid the same mistakes. Though it is different, it’s basically almost the same. What makes it different is that we have different situations, strategy how to solve it, timing, and a lot more. Thanks for sharing your experience, which taught me something I can use when I am in that kind of situation.
Glad to hear that not only are your FPU students learning from you, but you are learning from them as well. You are so right when you say that everybody’s situation is different but the solution is the same. When you try to tell people about paying off debt, I think people assume that you don’t understand their situation or that you don’t have sympathy for their issues. The opposite is true. You care, that is why you want them to do better. Regardless of what happened in the past, the only way to move forward and fix the situation is to follow the same prescription – pay off your debt.
I agree that the general solution (pay off debt, save more, spend less) is the same, but the details of how a person achieves that can be very different. Someone who has some credit card debt and wants to better their finances can do it on their own by getting on a structured budget and savings plan. Someone with a fair amount of debt may benefit from a consolidation loan that lowers their overall interest rate and allows them to pay more towards the balance of their debts. Someone drowning in debt, unable to meet all their financial commitments each month may need to take a more drastic route and enroll in a debt relief program such as debt management, debt settlement, or even bankruptcy. Some will need to utilize more than one of these routes. The common theme here is to do *something*. Analyze your situation, educate yourself as to your options and take the right path for your specific situation.
Well put. As someone whose debt has rarely been optional –health problems and bad luck in cars. etc — it can be aggravating to be grouped together under the idea of everyone having to take the same steps. Some people do… And still find themselves in financial straits.
I do understand the overall sentiment of this post, but sometimes it can feel a little dismissive to be given the same umbrella statements. I doubt that’s how you mean it, of course.
We have been there before. At one point we were debt free and then a medical situation put us $20K in debt. I moved it from a credit card once the zero % interest rate promotion ended to a home equity line of credit I opened at my Credit Union. It felt like a burden that would never end but eventually we paid it off over a couple of years. We had to scale way back our vacation plans and just buckled down to pay as much as possible.