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The truth about being broke

By Holly Johnson

For the Deseret News

Published: Thursday, July 11 2013 11:15 a.m. MDT

I can picture all the ugly details of the way I used to struggle; the empty bank account, the awkward moments, the feelings of despair…. And honestly, one particularly awkward conversation with my sister still plays clearly in my mind to this day.

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Editor's note: This article by Holly Johnson originally appeared on the personal finance blog, Get Rich Slowly. It has been reprinted here with permission.

It’s been a long time since I’ve been broke, but I can still remember exactly what it felt like. I can picture all the ugly details of the way I used to struggle; the empty bank account, the awkward moments, the feelings of despair…. And honestly, one particularly awkward conversation with my sister still plays clearly in my mind to this day:

“Hey sis, I’m coming into town this weekend,” she said innocently. “Maybe we could go grab dinner.”

“Ummm, let me think about that for a second.” I struggled to find a tactful way to tell her that I couldn’t afford it.

It’s been about ten years since then, but at the time I was 22 years old and flat broke. A series of bad decisions meant that I was trapped in a desperate situation that felt nearly impossible to get out of. And although I was going to school part time, I was living off a full-time job that only paid a whopping $9.15 an hour. Oh, and it gets worse.

Bad decisions have consequences

Have I ever mentioned that I once bought a $22,000 car while making just a little over minimum wage? The resulting $500 monthly car payment meant that almost half of my take home pay was being spent on transportation. And by the time I realized what I had done, it was much, much too late. Since I had always had wonderful credit, I refused to let a car repossession ruin everything in one fell swoop. I was (and still am) stubborn. So, instead of letting the car go, I struggled. This often meant that I didn’t have the money to put gas in my car or to go to the doctor. And I certainly didn’t have the money to go out to eat with my sister.

“Sorry, I don’t have the money to go out to dinner,” I said with shame and emotion I may never forget.

“You can’t afford to go to Applebees?!”

I could tell by my sister’s tone that she thought it was ridiculous that I couldn’t afford to eat at the cheesy neighborhood bar & grill. And honestly, I thought it was ridiculous too. Living so close to my means meant that I was always just one step away from disaster. One day off work, one prolonged sickness, or one unfortunate incident had the potential to leave me completely desolate. I knew that I had to change something. Unfortunately, I struggled to figure out where to start.

The truth about being broke

Shortly after realizing I couldn’t afford to eat at Applebee’s, I learned the truth about being broke. As much as I didn’t like it, I was going to have to make some drastic changes in order to improve my situation. So, I sucked it up and moved back in with my parents. As sad and pathetic as that must’ve looked to outsiders, I knew that this was my chance to get on solid financial footing. Since I no longer had to pay for living expenses, I used the opportunity to start paying additional car payments. I also began cleaning houses on the side while I went to school. I would often make $1000 or even $1500 payments on that stupid car, and I felt a sense of victory each and every time. It became a matter of principle. Every inch of my being wanted to pay off the darn thing, and I was itching to mail in that last and final payment. Fortunately, it was only a matter of time.

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