Fifty and Broke
For more than a year I have wanted to start a blog to share our story about how we paid off over $300,000 in debt and became debt free in our fifties. What stopped me was the sheer embarrassment and shame of disclosing our finances prior to starting. The concept of paying off debt seems so easy to apply using simple concepts such as, “Don’t spend more than you make”, “Live within your means or below your means” and “Pay yourself first”. There, problem solved. The premise is the same as losing weight, “Eat less, eat healthy and exercise more”. These are just such easy concepts, aren’t they? So…why isn’t everyone skinny and rich?
Geez, asking myself that question about my own self was excruciatingly difficult and painful. Perhaps I didn’t possess enough willpower or was I just not disciplined enough? Over the years I’ve made so many attempts to pay off debt and save but could never quite commit to developing a mindset to follow through. The older I got the more opposite I did of what I was supposed to be doing, and nearing forty-nine years of age I was scared, depressed, ashamed, and getting fatter and into more debt with each passing year. I had plummeted into a dark deep hole both financially and mentally, feeling like an absolute failure, and had purposely self-sabotaged many aspects of my life with friends, my career, my health and my two failed marriages; I was isolated and ashamed, petrified someone would find out about my dirty little secret. For many years every decision I made was the spur of the moment, unplanned and chaotic, and I didn’t know what I was doing or why I was doing what I was doing. I walked around feeling exhausted from keeping up the facade of looking successful, yet secretly I was just about surviving, as I lived pay cheque to pay cheque. I was a financial advisor in a bank, yet my own finances were utterly devastating. I was a broken and broke person trying to explain personal finance to other broke people and felt such disgrace discussing financial planning principles, yet in my own life I wasn’t following any of these myself.
I had resigned myself to being a closeted financial failure, until one fateful night a month before turning forty-nine I sat at my kitchen table staring at my mortgage renewal statement, and realized if I consolidated all of our debt into the mortgage with another twenty-five year amortization, I would be seventy-five years old before our mortgage would be paid off. The despair hit me like a ton of bricks, and I became overwhelmed with having no emergency savings, little retirement savings and $374,000 of debt. How was I ever going to pay my bills, pay down all of this debt and save for my retirement so late in life earning only sixty-five thousand dollars a year? That moment was the rock bottom moment in my life. At nearly fifty was it all too late?
At that time, I had no comprehension of what the journey to become debt free was going to look like for my husband and I. I didn’t know where to begin, or how long this journey would take. Little did I know what it would entail to pay off our mountain of debt, and how grueling the next four and a half years would be. This time it had to work, so we sold, we downsized, we changed our lifestyle, and forced ourselves to be more determined and disciplined than we had ever been before to get out of debt. Once I realized it was possible for us to do what we thought was impossible, and to be in control of our money, our lives, and our retirement, I wanted to inspire others to do the same and to share how we did that.
Paying off debt was simple but not easy. Here on this blog I can only offer and share my advice and tips as something that has worked for us after trying to be debt free many times before. The steps to be debt free are only one percent of the solution, with you being the ninety-nine percent part for the rest. No one can do this but you, and the burden of paying off debt lies solely on your shoulders. This practice is for everyone, but it is also not for everyone, as you must be in a mindset ready to take on sacrifice and sweat to pay off all of your debt and get your finances in order. If you are married or in a common law relationship you really must both, be on the same page, as it’s not going to work if you are not equally committed to working towards the same financial goals. Like myself you may have to hit rock bottom before this journey even begins. You may start and stop and start again. I akin this experience to running a marathon without training for a 2K walk beforehand, and for us we had to radically shift our mindset and quickly adapt to living in a way that was so alien to what we had become accustomed to. We gave ourselves five years to repair our lifetime of stupid and sloppy decisions. Time was not on our side, and this really was all on us to fix.
I feel like it has taken me many years to adopt the serenity prayer into my daily living, especially finding the courage to change the things I can, and doing exactly that, is really what this blog is all about. This prayer, famous for helping those with addictions, has helped me with my own. Utilizing credit enabled all of my addictions, my lifetime addiction to shopping and buying stuff, my addiction to food and eating, my addiction to feeling love and wanting to impress and please, and my addiction to wanting to measure up and projecting success. So many addictions, an endless number of them, have caused me nothing but destruction, shame, chaos, and despair. I have really had to teach myself to stop, think and understand that every financial decision I make today will have an effect on my life tomorrow.
I write this blog specifically for those who are nearing fifty, or older than fifty, and have debt that is overwhelming. If you have no money in the bank and have paychecks that are spent before they are earned, and if you feel you can’t get a hold of your finances, I hope this will help you to get on track to live a financially stable future. If you are in your 20’s, 30’s, or 40’s, and you also wish to participate, then all the better.
There may be criticism and nay-sayers, but I am not afraid or intimidated by this. I simply do not care what other people think anymore. Do what you will, if you do not want to do this process, don’t. If you do not agree with it, don’t do it. I am not trying to prove anything or to tell you what to do, or to judge you, only to share with you what has worked for us. It’s your choice entirely.
In my job as a financial advisor I have personally met thousands of good and wonderful clients nearing fifty or in their fifties, sixties, and seventies, who are struggling with life and with debt. They are living paycheck to paycheck or pension cheque to pension cheque, in deep depressions with stress related health issues, going through divorce, some still supporting their grown children, their grandchildren and their parents, completely lost for where to go and what to do. There are millions of us out there quietly suffering, hiding the truth, living a lie, scared, embarrassed and feeling alone; not knowing how to start or how to make changes. For many of us life took a detour, or the wrong road and life just happens. We are where we are. People who are going through this struggle truly are my soul mates and kindred spirits as I understand completely where you are financially, emotionally, and mentally, and fully appreciate what you are feeling because I was in your shoes. There is no judgement here of you or whatever situation you might be in. Over the years I have had hundreds of people cry in my office, feeling scared and alone and have given out just as many hugs and tissues. Little did any of them know that I was also suffering. I needed the hugs as much as they did, but I was too ashamed to share and connect in that way with my clients.
This debt load of lines of credit, mortgages, credit cards and car loans, are physical and mental weights that have taken over like a silent plague or silent shame, in our society and are destructive to our financial and mental health. Separation of family is rampant, with money issues being a leading contributor to the reason why. I personally know what a widespread issue this is from the numbers of clients I have watched suffer in my office and whom were brave enough to come in to share their experiences with me as they tried to fathom what had brought them to where they currently were financially.
I started writing this as a personal journal and at the time never wanted to share our journey out of sheer embarrassment, however, as we experienced improved mental and financial health, I felt the need to share what was working for us and the journal turned into a blog. Recently I attended a dinner party with close friends. After dinner the conversation had gone quiet for a moment and a friend from across the table asked me what I had been up to, I replied, “I’m thinking of writing a blog and I’m going to call it, Fifty and Broke, because that is what I am”, and immediately upon declaring this I heard a gasp from some of my friends who had bought into my façade of success. One friend who I admired so much and always thought was so successful and put together, looked right at me and said, “I am fifty and broke”, to yet more gasps, and later that night another friend who had been there called me at home to say she was sixty-three and broke and needed some advice. A week later I received an email from another friend who had been at that party saying she was also afraid and in debt and needed help. That’s when I knew I had to be brave and to share our journey, as I realized that even in my close circle of friends with whom we shared everything in our lives, we just couldn’t muster the courage to share with each other collectively, that we were broke, scared and felt overwhelmed with fear.
There are two parts to this blog. The journey (blog), and the journal (tools). The journey part talks about my own story and mindset and attempts to address my mindset and life decisions about how did I get here? I hope by sharing, it will allow you to reflect on what your own journey has been and answer some questions for yourself about what circumstances or ways of thinking brought you to this point. I then share the process, tools and methods my husband and I used to get us out of debt.
The journal involves you creating a budget and implementing tools to measure your own debt, income, cash flow and net worth. The solution I am offering focuses on three main financial goals which are:
Setting up a budget with a plan to be debt free within five years or less,
Saving for an emergency fund of six months of expenses, and
To set up a payment plan to be mortgage free on or before retirement.
It is only then, with whatever time you have left before retirement, that I would suggest you start to invest. This blog (for right now), focuses on only these first three goals. It took us just over four long hard years just to pay off our debt and it may be a very difficult reality to accept that it might take you just as long to complete only one of the three goals. Believe me, I know! I think the biggest mistake we all try to make through life is that we want to accomplish too many things simultaneously. We try to juggle too many balls, constantly dropping them, and getting sick and tired of picking them back up again, only to be dropped. This journey is about focusing on juggling only one ball at a time.
Are you finally ready? Are you just exhausted from living like this? Do you have the determination to stay on track for a better life? Retirement is coming, and it is coming fast, so let us make the best of what is left of our lives and move forward together. You can do this!
