Whelp, it’s official. Florence has made its way to the coast of North Carolina.
But, we live so far inland than we’re not really seeing any of the effects… at least not yet. The hurricane is projected to move west or southwest, and so we’re expecting some wind gusts and some rain. And there is a flood watch but… I suspect there won’t be any catastrophic flooding.
Which reminds me…
One of the best lessons I ever learnt about finance happened when I was just 18 years old and dove into a pile of debt and nearly drowned.
Seems today that a lot of financial planners try to convince their young clients to never do this. And, really, I can see their argument. Getting out of debt is tough.
Here’s my take on it:
I learned a lot of very valuable lessons. When I was 18, almost a month after my birthday, I started receiving a bunch of offers in the mail for credit cards.
And then I had my eye on a brand new Honda sports coup. And then, and then, and then.
I chewed threw $20,000 of credit, but a car loan and a few other interesting credit sources.
When I was in over my head, I didn’t even realize it. I was basically blinded by the monthly payments, which were more than affordable at the time.
And then… I lost my job.
Everything came tumbling down around me.
I couldnt’ afford my credit card payments. I couldn’t afford my car payment. I had to go to the doctor but… I had lost my health insurance.
I had no savings because… who needs savings when you’re 20?
I needed a plan to get out of debt, and fast. And… I thought I had found the way: plow as much money against my debts as humanly possible… once I had another job, that is.
So… when I finally landed a decent-paying job, I started to put everything I could toward my debts. I was actually doing very well… for a while.
And then… an emergency. Great! I have so much less debt now, so I’ll just use some of my savings…
Oh. Wait.
I STILL didn’t have any because I was busy paying off debt, so… I had to go BACK into debt. Problem was, I couldn’t really do that either.
I had voluntarily surrendered my car to the bank, and even though I was paying off my credit cards, I still had a lot of 90+ day late marks on my credit report.
And so… I learned something.
I learned the value of saving money AND paying off debt at the same time.
It wasn’t until much, much, later that I was able to verify (mathematically) that this often worked out much MUCH better over the long-run.
Anywho, if you want more details on how this works, then start reading the whole life insurance section of my life insurance guide, here: