When things were booming it seemed there would be no end to our prosperity. Our business grew. We got involved in a second business. Our income was the best we had ever experienced. But with our success came the ability to borrow large amounts of money.
But, no worry, we had plenty of real estate equity and if things ever got tight, we’d sell the house and pay it all off. Besides that, our account always seemed to have a comfortable cushion. In a situation like this, it really wasn’t even borrowing – just a reallocation of funds.
As things tightened the cash cushion went flat. And as we tried to sell our house the equity disappeared before our eyes. The cash, the equity, and the ability to profit vaporized as quickly as a summer shower on a blacktop road in Florida.
It was terribly uncomfortable… and still is. With financial failure comes phone calls engineered to shame you, create fear, and move you to find a way to pay. They’ll push you and cajole you to borrow from relatives, friends, or credit cards to make their collection call a success.
As banks and manufacturers get trillions in bailout money (our tax money) the small business owners and the working men and women get the shaft. With destroyed credit scores come rejections for new employment, limitations on housing rental options, increased public utility deposits, and increases in auto insurance. And to add to our pain and disgust, the only solution offered by the government is a grand scheme to borrow and spend more money than any government in known history.
It has been said that most families live one or two paychecks from the street. Homelessness is no longer the unfortunate end to a life of alcoholism or drug addiction. Former corporate executives are now among the homeless. There are invisible homeless persons who can be found sleeping on the couches of relatives or friends.
Positive life lessons have been learned from this time of leanness. For the first time in recent history, Americans have a positive savings rate. Like our grandparents who survived the Great Depression, the way we think about money is being impacted in a way that we will not soon forget. My personal lessons learned from the last few years are:
1. Stop borrowing. Not, stop borrowing temporarily, but stop borrowing forever for anything. My wife and I have agreed that if we have to live in a 1946 camper trailer, we will not borrow ever again…. for anything.
2. Save money out of every paycheck. Pay yourself first. If we save enough and things slow down in the future, we can just go on vacation.
3. Live more simply. Keep overhead low. Travel light. Our lives have become much more complex than they have to be.
4. Relax. Don’t fear. We’ve been to the bottom and back. Ask yourself in each situation, “what is the worst that can happen?” Fearless people can accomplish great things. Take liesure time to decompress and retool. An ancient Chinese proverb says, “The bow that is always bent will soon cease to shoot straight.”
5. Invest. Be forward looking. Be proactive. Build your future success through investing. Don’t be afraid to dream big dreams and implement bold plans.
6. Grow. Further your education. Get a new professional designation. Read books on personal growth, success, and new ideas. Keep an open mind for positive change. Improve your health through a healthier lifestyle of fitness and nutrition.
7. Give. All of our getting, growth, success, and money means nothing if we are not helping others in need. Our investment of time, energy, and money into others really defines who we are as people. This is one of the big things that will matter at your funeral service. Did you positively impact the lives of others? Giving is loving and loving is living.
The negative experiences of life can make us bitter people or better people. We choose our destination in life by the way we respond to our problems.