Thursday, June 18, 2009

Expectations and Financial Savvy

You might not believe it, considering I have a blog with 300+ posts about the state of my finances, but I was brought up never to talk about money. The way I grew up, money was something nice people didn't talk about, like bathroom habits and politics. Prior to my separation, really the only person I talked to about money was my friend Catie, who sometimes comments on this blog.

That is one of the very reasons I started "Fighting Foreclosure - Getting Nine Hundred" - to start talking about money and budgets. So much was happening a year ago - I had just gotten divorced, I was moving for the second time in year... and I wasn't sure how I could handle all of it, plus I had no idea how I was going to afford it! Finances were one of the number one things on my mind then. After all, I knew I could get through the stress of the divorce and knew that the heartbreak would eventually heal* but not if I also had a house going into foreclosure. I had to figure out something fast!

And just as importantly I had to talk about it. In part, I needed to have a place where I could track my ideas - see what worked and what didn't. I needed some kind of record so I could chart successes and I wanted a place to put new ideas I wanted to try, but more importantly, I needed to break free of my childhood stigma of talking about money. While there is certainly something to be said about keeping financial information close to the vest, there is also this huge cloud of shame that is wrapped up in money. If I had tried to be all stoic this last year and hide what was going on, I think that shame would have brought on a real bought of depression. What I'm going through is hard, but it is what it is. I didn't want to add feelings of embarrassment on top of it! The only way I knew how to break free of all that was to talk about it... a lot. This blog has been fabulous - I've been able to write about my life, plus get tons of support from friends, family and fellow writers.

And it has spread into my day to day life. Now, I am pretty comfortable talking about my situation with just about anyone; not just my friends who read Fighting Foreclosure, but any friend or acquaintance who asks how life has been treating me post divorce. I've gotten used to telling people, "I am broke but still fighting" and even explaining the whole plan for getting nine hundred dollars a month if they ask. Oh, occasionally I still get that slightly offended, "I'm not sure you should talk about money that way" look, but I figure those are just people who were raised like I was. Most people are interested and in turn, the more I have become willing to talk about my struggles, the more willing people have been telling me about theirs.

Which leads me to some thoughts about expectations...

One of the things I have learned is that intelligence doesn't automatically equal financial savvy. I know a lot of very smart people who are in a bit of a financial mess, including myself. I think financial skills are just like any other talent - take singing, for example. There are those rare few who can sing like Pavarotti, those who don't perform but can rock a karaoke machine, and those (like me) who only sing in the key of "off." Most fall somewhere along this spectrum. For some folks, singing comes naturally and it is something they enjoy practicing and learning more about, for others of us, singing is something we only do in the car. Alone. With the windows rolled up. Just as not everyone is born to be an opera star, not everyone is born to be Warren Buffet. It doesn't have to do with how smart you are, it has to do with a certain amount of natural talent, combined with interest, combined with drive. If I chose, I could take singing lessons, and while I may never perform in public, I might get to the point where I didn't have to lip sync "Happy Birthday." Financial skills can be learned as well, and while I may not be a multimillionaire, you can bet I have learned a lot over the last year!

A painter friend of mine was recently frustrated when some pieces of art he was working on weren't coming out perfect the first time. As we chatted about it, he told me that he gets really disappointed when it that happens. I tried to tell him that expecting perfection the first time was a bit much, but it wasn't getting through. So, since he is a sports fan, I used a hockey analogy - did he think that great hockey players didn't have to practice? Did they step out on the ice and have perfect games every time? Did they never made mistakes? Did it not take years and years to get to where they were? Thinking about that later, I thought, isn't it the same thing with finance? Some might say having good skills is as simple as spending less than you earn - but isn't that like saying hockey is just skating and hitting a puck?

What I am getting at here is that I used to be more like my painter friend when it came to my own finances. I'm a smart gal, and I expected that I would be able to handle everything easily the first time. The last year has taught me that that expectation was a bit ridiculous. I needed to learn better skills, but it wasn't because I wasn't intelligent - it was because I hadn't read up on this kind of thing before, I never felt I really had to. I know a number of sharp individuals that are in the same boat - having to reevaluate their personal finances because of job loss, medical problems or even just a few choices that seemed like a good idea at the time, but didn't pan out. These things happen, and have happened to a number of us. I think it is a part of learning - first, you have to fall on your face a few times.

So my words to anyone going through tough times is this -

1. You are not alone.

2. You can be a smart person but still know bupkis about finance.

3. Talk to other people, they may share your problem or have something similar. In my experience, people are incredibly supportive if you are working on solving your problem.

4. Read everything you can, or if you are not a reader, find a few people you trust who can help teach you the basics.

5. Don't give up, and see rule #1.

* The average time for a heartbreak to heal? 18 months. Really, scientists have proven it. I found that oddly comforting during my divorce. It is good to know that eventually things will get better.

Photo by: Adam Foster - Codefor


Catie said...

Best....... post........ ever......

I wasn't raised in a "money is taboo topic" way, but we didn't talk about it except to discuss that credit is baaaad. My parents pay as they go, and pay off credit cards every month, which I highly respect. But I didn't really know why so when I got to college and got that credit card I thought I had found happiness!! Thank goodness schools are starting to have financial awareness classes.

I have also learned a great deal about finance and you're right, anyone CAN do it. Now if someone could just fully explain the stock market to me....

Dawn said...

I am so glad you liked it Catie!! You know what the funny thing is? This post was originally supposed to be about something else (which I will write about later) but as I was writing it, the whole thing solidified for me and suddenly came together. It is something I have been thinking about for the past few weeks, but suddenly gelled when I wrote this.

When you find that person who explains the stock market to you, invite me along!!! I feel like I understand just enough to be dangerous, you know? That's why until we do find that guru, I'm staying far from it.

Frugalchick said...

Such a great post with so many good points. You can have plenty of head knowledge on any subject, but most actions also involve our emotions, habits, beliefs, upbringing, etc. There's never a money decision that works for everyone, as all of us lead such different lives and have different priorities. I feel like American children are so often told there is one basic path, and it can be hard to talk about veering from that path and making decisions that work best for our indiviual lives.

On the other hand, I also agree that some things should usually be kept private. My husband's family talks about finances so much and so openly that it can be offensive to those who don't make anywhere near what they do. For example, they were sure to tell everyone the price of the new house they had recently bought, even though some of the people they told wouldn't have been able to afford 1/5 of that price. To them, it was just stating a fact, but I know it made some others feel inferior. There's definitely a time to be aware that complete honesty may be more hurtful than helpful.

Dawn said...

Ooooh Frugalchick, very very good point. When I was writing about talking about your finances, I was thinking of it as talking to others who are in the same financial boat as you or asking for advice from those who have knowledge you don't. What I didn't think about was how offensive it could be, if you are at a much higher economic class than the people you are talking to. Good point - thank you for bringing that up!