Champagne Wishes and Caviar Dreams–Well, Not Quite



E 42nd St & 2nd Ave, New York, NY 10017

Neighborhood: Tudor City

If you live toward the southern tip of Manhattan, and you can’t sleep, look to the northeast and try to locate the big Tudor building on East 42d Street. You might see a light on about half way up, and there’s a decent chance that it’s shining in my wonderful, cozy apartment.

I’m not an insomniac, but, occasionally, I do have trouble sleeping. Every few weeks I wake up because of a bad dream or a loud noise, and the first thought that pops into my head is “money.” I try to ignore it, and do my best to get back to sleep. But, usually it’s too late. When the number crunching begins, there’s nothing I can do to stop it. In my head, I calculate: if it’s the 18th of the month, and I have $450 in my checking account (there is no savings account), and I get paid on the 21st, and my allowance (yes, my allowance) from my parents comes on the 25th, and my student loans get electronically deducted on the 1st, and my rent is due that day too, will I have enough money to pay my three credit card bills sometime around the 5th?

Usually, at this point, I turn on the light, climb out of bed, find a screwdriver, and grab my bank. I bought the bank last summer at one of the Chelsea flea markets to hold the loose change that collects in my pockets and bags. It’s a cast-iron pig with wings, and looks like it would take flight if only it didn’t weigh a ton. I lug the pig back to my bed, where I unscrew the bolt in its side and dump the coins from its belly onto my blankets. For a few moments I pretend that I am surrounded not by small change, but by gold doubloons. Then I come to my senses and prepare to sort.

I started rolling coins several months ago, and I find it to be very therapeutic. I do not use one of those little gizmos that separates out the change, nor do I take my money to a Coinstar machine that has the nerve to take a commission. Instead, I do everything by hand. The routine is soothing: first, I put all of the like coins into ten piece piles, which makes adding easier, then I drop the money into the paper wrappers and seal them, and, finally, I line all of the finished products in a row on my bed. When I look at my neatly packaged money, I feel like I really am a saver. But, I am delusional. As of today, I have about $250 of rolled change in a Gristedes bag in my closet. I don’t worry too much about someone breaking in and stealing my measly life savings–and it is my life savings. The robber would need a wheelbarrow to get the heavy package out of my apartment. In fact, I would need a wheelbarrow to get all of the change out of my apartment should I want to do something useful with it. For now it sits on a shelf next to my sweaters, giving me some piece of mind.

Despite my treasure trove of change, I’m pretty much broke, and I don’t know what to do about my financial situation. I love my low-paying job, and don’t want to leave it for a job I’d hate. I suppose that I could go back to school, but there is no way I can afford to take out any more student loans. Although my mother always tells me that student debt is “a mortgage on my future,” more loans will surely mean the end of me. So, I think I’ll stay put for as long as possible, provided that I don’t get laid-off. (I try not to think too much about that horrible, horrible possibility.)

Since I am not willing to make any dramatic life changes right now, a few weeks ago I asked my friend Kathleen, a budget analyst, to help me with my finances as they are. She devised a clever spreadsheet that considers my income and all of my expenses and then calculates how much money I have left over for daily spending. After all is said and done, it turns out that I have less than twenty dollars per day to spend on non-essentials. At first, twenty dollars a day didn’t sound so bad. But, as Kathleen reminded me, that twenty dollars includes all clothing, book, and music purchases, as well as movie tickets, dinners out, slices of pizza, sodas, taxis, and assorted impulse buys. When Kathleen evaluated all of the data, she told me that if I ever want to be solvent I need to get rid of my apartment.

Oh, but I love it so.

And I’m convinced that even if I moved into an apartment that rented for three or four hundred dollars less per month, I’d find new ways to waste whatever money I saved. I guess, then, that I might as well keep living beyond my means in a space that makes me feel happy, settled, and safe, right?

Right. But I decided that even if I can’t avoid living paycheck to paycheck I must do something about my credit card liability. Kathleen told me that I immediately needed to liquidate “all” of my assets and eradicate all of my high-interest debt. That would have been a great idea, had I multiple assets to liquidate. In reality, I had only one small CD, which my parents controlled.

Previously, I had mentioned in passing to my mom and dad that I had accrued “some” credit card debt over the years. In a breezy, joking tone I’d confided to my mother that I was shifting my debt from one card to another in order to get the best interest rate. By sharing that tactic with her, I hoped she’d think I was savvy. My mother laughed at my confession–maybe she thought I was kidding–and she didn’t ask me how bad things really were. Boy was she in for a surprise.

When I called home to ask about liquidating my asset, my dad answered the phone and told me that my mother was at her exercise class. We chatted about my job, his golf, and the weather. Finally, I asked him if he knew when my CD would next come due, and how much I had in it.

I don’t know, why?,” he replied.

“Because I want to pay down my credit card debt.” My father, a banker, thought that would be a good idea.

“How much?” he asked. Usually, when discussing financial matters with my parents, I always shave a few (hundred) dollars off the top of my expenses. My new computer wasn’t $1975, it was $1550. My vacation didn’t cost $1250, it was $1100. I don’t know why I do this, because I don’t think they’d really care, or get angry with me, but for some reason I usually just can’t help myself. This time, however, I decided to tell the truth.

“About seven thousand dollars.”

My father calmly asked me how I had racked up that much debt. I said, “college, grad school, my apartment, it all added up.” He accepted that explanation, but was concerned that I might be having trouble paying my rent. I told him that I wasn’t (and, I wasn’t), and I swore that most of the debt was old (and it was), but that I haven’t been able to pay it off.

My dad told me that I would be okay.

Later that night, my mother called. She was hyper from her workout, and talkative. She hadn’t spoken to my father, so I interrupted her and cut to the chase.

“I need that money from my CD. Do you know how much I have?” She paused, and I knew that she was suspicious.

“Around $2500,” she said warily. “Why?”

“Because, I want to start paying down my credit card debt.”

“How much do you have?”

“Seven thousand dollars.”

My mother–who pays the bills in our family and never carries a balance on her credit cards–audibly gasped, and demanded to know exactly how that had happened. Truthfully, I didn’t have a good explanation for her. While I have recently attempted to stop using credit cards entirely and instead operate on a cash economy, there were two or three years where I did a lot of stupid stuff with credit. Like starting a tab while drinking in a rowdy bar filled with lots of hard-drinking friends. Or, like charging most of my Christmas purchases for three years running. Or, like using a credit card to pay for hotel rooms, gas, and roadside snacks while on a cross country trip. Of course, I neglected to pay off most of those purchases.

I’m not sure why I made such bad choices during that time. Actually, I’m not sure how I got that way in the first place. My parents are both careful spenders who tried from an early age to instill in me the value of money. Rather than giving me an allowance, they made me get a job on the first day I was permitted to under the child labor laws. Though my early jobs taught me good work habits and all sorts of nice things, somewhere along the way I tossed aside the value of saving my paychecks and began to spend my earnings with reckless abandon. Now, at age 26, I depend on an allowance from my parents each month to pay my rent. My mother has always accused my of being careless with my money, and clearly she is right.

Although I sincerely want to get myself back into the black, it is very easy to let the debt grow under a 9.99% APR. And, I find it so hard to save. In fact, I often use my post 9-11 fatalism to justify my spending. I mean, really, what’s the use of trying to pay everything off when we have no idea when or how the other shoe is going to drop? Why not enjoy life and spend, spend, spend?

Thus, by disregarding my parents’ example and embracing my own brand of deranged financial planning, I’ve gotten myself into one heck of a fiscal pickle. (I know that there are many people in my age group who make even less money than I do, and who have debt that makes mine look pale in comparison. My thoughts are with them.) But I’m confident that I can get out of it with a little bit of self discipline, and maybe the surrender of my beautiful apartment–though I’m not ready to concede that yet. A few days ago, my mother sent me the $2500 proceeds of my CD with a written instruction that I use the money only to pay off my credit cards. It was enough to just about cover one of my bills in its entirety. Although it was tempting to pay $2000 and “save” the rest of the cash for later, I resolved to surrender all of my newfound money to First USA. Two days ago I deposited the check, and today I paid the entire balance by telephone. As soon as I hung up, I felt immediately relieved, until it dawned on me that my mom’s check may not yet have cleared. Quickly, I called my bank and asked about the check’s status. The service representative told me that it wouldn’t clear until tomorrow. Terrified of bouncing the payment and plunging myself into an even deeper pit, I told the friendly representative what I had done. She assured me that the payment would be held against the check and would not bounce.

“So,” I said, “everything’s going to be all right?”

“Yes,” she told me, “you’re going to be okay.”

It looks like I might just be on my way to financial security. And, keeping my bank representative’s reassuring words in mind, I plan to sleep well tonight. But, I’ve got plenty of change to roll should I awake.

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