19. Meet You Halfway – NTT #19

meet you halfway cover

Hi everyone!

Welcome to another New Tune Tuesday! Er…Wednesday. New, um, Wailing, Wednesday? New…Wanton Wednesday?

Look, I’m late, ok? I get it! But I’ve been up to a lot lately! Let’s talk about it while you listen!

So ever since Devin and I decided to make our big goal a move to New York City we’ve had to get pretty intense about budgeting. We moved into a cheaper place, sold our car about a month ago, and changed a lot of little things about our spending. But the biggest thing I did was make a couple of sub-savings accounts.

That coin seems to be going troublingly fast.  I saw an exotic film one time where a lady shot a coin out of...nevermind.

That coin seems to be going troublingly fast. I saw an exotic film one time where a lady shot a coin out of…nevermind.

So in your regular banking account you probably have your checking account and your savings. Boom. Done. Simple, right? Don’t even need to worry about it.

Except that you DO worry about it! Because checking doesn’t just have your extra money in it, does it? It probably has money for your rent or mortgage, your car payment, your credit card payment, and money to pay the gas and electric bill, and, “Oh damn! It’s Grandma’s birthday tomorrow do we have any money left?”

The solution? Well, for me anyway, it was to make another couple of savings accounts. I mean, they’re not actually different savings accounts. But your bank, or credit union, if you ask them to, will divide your savings accounts into some different names. So I have two checking accounts, and a few savings accounts:

1. Bills Checking — This is my original checking account, since my bills were already hooked up to it.  Whenever I make a deposit, I put money here first. I get paid weekly, so the first four weeks of the month I deposit a quarter of what I need to pay ALL my bills into this account. That way, the money is set aside before I can spend it, and I know that I’ll have the money to pay rent and utilities and whatever else I have to pay every month no matter what.
2. Taxes Savings — I wait tables for money, so I have to put money aside for my taxes. This is the 2nd place I deposit my money.
3. Traditional Savings — This is where I put my savings goal for our move to NYC, as well as keep a thousand dollars around as an emergency fund.
4. Wants Checking —  This is my new checking account. Whatever is left over after I make those deposits is my extra money!  I can spend this money on restaurants, booze, gifts, clothes, and not worry about whether I have enough to pay  my bills because it’s already taken care of!

Now, of course, you still have to check your balance every couple of days to make sure you know how much is left in your checking accounts, but for me this has FINALLY allowed me to consistently save money towards my goals, save to pay my taxes, and know exactly how much money I have left over for the fun stuff.  This is especially helpful for people with a variable income.  Some weeks I’ll have a lot of money left over, some weeks I have very little.  But I know my basic needs are going to be taken care of.

I could be my own adult baby! I mean, I could be both the adult AND the baby.  Maybe this isn't the best analogy, but the picture is priceless.

I could be my own adult baby! I mean, I could be both the adult AND the baby. Maybe this isn’t the best analogy, but the picture is priceless.

In the past couple weeks I realized that I’d really like to help other people with their budgeting.  I’m thinking of starting my own online budget consulting service.  I’m still a few weeks out, but I’m testing a new system out on a few of my coworkers and friends.  When it’s ready I can’t wait to share it with everyone!

In my research I’ve just finished a book called “All Your Worth” by Elizabeth Warren and Amelia Tyagi Warren.

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This book was AMAZING.  Seriously, everyone that is trying to balance their finances should read this book immediately. (And if you don’t know who Elizabeth Warren is, you need to read this, or maybe watch this, and hope that she runs for president.  She is the best.)  Besides just strategies for budgeting and advice, the authors discussed the history of our modern economic reality.  Not for oil tycoons and hedge fund managers, but the reality on the ground for people like you and me.  She talks about the stigma from older generations towards our younger generation surrounding credit card debt and living paycheck to paycheck.  If I run out of money and have a huge credit card balance, my grandfather would probably tell me: “Sam, stop eating out at fancy restaurants and buying designer jeans!  If you could just keep control of your spending you would be fine!”

He'd probably also to tell me to get that "banana" out of my mouth, but, whatever. Love you, Grandpa!

He’d probably also to tell me to get that “banana” out of my mouth, but, whatever. Love you, Grandpa!

But there’s something else that has happened since the early 70’s.  Banks and credit cards were heavily deregulated!  When my grandfather became a young adult and got married, for one thing his college education was WAY cheaper, adjusted for inflation, than it is today.  When he wanted to buy a car he had to sit down face to face with his banker and bring out all of his bills and taxes, his paychecks too, and the banker would decide if he could afford the car.  Or the house.  And if the banker didn’t think he could afford it, then my grandfather wouldn’t get the loan!

So older generations grew up in a world where there weren’t credit cards (except for the VERY wealthy), and the only loans that you could get were ones that you could pay back!  Imagine that!

But since the deregulation of laws surrounding loans and credit cards throughout the 70’s and 80’s, you are actually MORE likely to get offers for credit cards if you have bad credit and have shown that you CAN’T reliably pay your debts!  That’s what one of the main causes of the Great Recession was in 2008!  Huge numbers of young Americans, like my grandfather in the 1950’s, were emerging from college and wanted to buy a house and a car and live the American dream, just like their parents did, and their grandparents before them.  Except the reality was different!

1. They were graduating with HUGE amounts of student loan debt.
2. They were either not finding work at all, or taking on work with wages that were the SAME as those paid to their grandparents even though it was 40 years later (adjusted for inflation).
3. Or maybe they weren’t graduating at all from college, and taking on lower paying jobs to feed their family and put a roof over their heads.

Back in the 1950’s the banker would have sat down with these people and said, “Sorry, son, but you can’t afford to buy that house you want.  It’s just not realistic.  Here’s what we can loan you.  Go find a house in that price range.”

It's...not that bad!  Just needs a little paint! And, ya know, a fire!

It’s…not that bad! Just needs a little paint! And, ya know, a fire!

But in 2007 the message was, “You don’t have a down payment for a house?  No worries!  We’ll just charge you a higher interest rate!  Like, instead of 6% we’ll charge you 15%!  But not for a few years. So don’t worry, the economy is only going up and up and up, you’ll be making SO much more money by the time the interest goes up you can pay the mortgage off easy.  So sign here and here and we’ll get you into your new home!”

Or a new car.  Or a new line of equity on a home.  You name it.

J.P. Morgan Chase was slapped with the largest single fine in U.S. history last year for KNOWINGLY selling bad mortgages to investors as if they were a Triple A, safe investment.  But those mortgages were given to people they knew could not pay their mortgage.  Huge amounts of money were invested from all over the world in these giant packages of bad mortgages, thinking that the market would just keep pushing prices higher, but sooner or later, people stopped paying mortgages they couldn’t afford and the market exploded.  And with it, all of that wealth that was invested in these bad mortgages given to people that didn’t know better and couldn’t afford them.

Is some of the blame on those folks for not knowing more about their own finances?  Sure!  But is some of it also a societal blindness, and deafness, about money?  Our older generations still assumed that the banker wouldn’t give someone a mortgage or a car loan if they couldn’t afford it, so they told the younger generation, “Go for it!  You’ve earned it!  You’re living the American Dream, just like we did!”

Helen Keller - "To be blind is bad, but worse is to have eyes and not see." (You don't know how hard it is not to tell a Helen Keller joke right now.

Helen Keller – “To be blind is bad, but worse is to have eyes and not see.” (You don’t know how hard it is not to tell a Helen Keller joke right now.

But, as we found out, it ended up ruining a lot of people’s lives.  Bankruptcy is more common than divorce in America.  But I bet you know a lot more people that have been through a divorce then have declared bankruptcy, right?  That’s because there is still such a stigma and judgement of people who, “Can’t control their money.”  So people will do just about anything they can to make sure no one knows about their money troubles, even when they are on the edge of collapse.

The game is rigged.  It’s rigged against you.  Bankers and Creditors want to wring every last dime out of you, and there are no regulations to stop them anymore.

So that’s where you come in.  Maybe with help, from someone like me!  You need to be your own regulator. Your own banker.  Balance your money and figure out if you can actually afford the bills you’ve amassed.

I’m not quite ready to start doing counseling yet.  Like I said, I’ll announce it on here.  But it’s been very energizing and exciting learning more about the societal realities that lead to our current financial struggles, and the tools we can use to balance our lives out and start amassing wealth.

I’m thinking I want to call it:

Find Your Balance:  Budget Coaching for Waiters, Tipped Workers, Freelancers and Everyone inbetween.”

I know, it’s a little long.  So help me out!  What would be a good name?

Thanks for reading! (And listening. That was a long entry. The song is probably over by now.  Unless you listened to the FULL version and heard the creepy message I inserted at the end.)  See you next week!

-Sam

p.s. there is no full version of the song.

 

Sam Wessels

I am a writer, composer, actor, and gamer, with six musicals written, one piano album published, and one boyfriend to come home to. Come back each tuesday for a new and original piano performance.

2 Comments

    • Klair, Awesome! I’ll let you know when I get it up and running! Thanks for keeping up with me on the site. Hope you’re doing well.

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