Every Sunday morning for the next few months, I’m going to “riff” on a chapter from my book, The Simple Dollar: How One Man Wiped Out His Debts and Achieved the Life of His Dreams by reflecting on particular pieces of it that I’ve had further reflections on or particularly excite me, including some elements that were removed from the final draft. You can find out more about the book by reading some of the life-changing experiences the book has given readers or reading the Amazon reviews.
The book opens with a chapter on debt repayment. In my original draft, this chapter was in the middle of the book and the book actually started with the second chapter, What’s Missing?, which focuses on the fact that we all have problems in our lives and that success comes not from laying blame on those problems but from accomplishing what we can in spite of those difficulties.
Why talk about debt first, then? The real reason is that overwhelming debt is incredibly scary. It’s the most challenging and frightful topic I discuss in the book. My book is largely optimistic and forward-looking – debt, on the other hand, causes people to feel fear and hopelessness. I know – I’ve been there. I open the book with this little anecdote from my own life:
I began to quickly realize that the pile of bills I just received not only wouldn’t be covered by the current balance of my checking account, but that my next paycheck would not cover them either – and that was if I spent absolutely nothing on food, gasoline, or anything else. I sat there completely stunned for a moment; then I got up and went into my son’s room, closed the door behind me, and sat down in the rocking chair across from his crib. He was so tiny lying there, less than six months old, and sleeping so peacefully there without a worry in the world. As I watched him lie there, gently breathing, emotions poured through me. Guilt. Shame. Embarrassment. Pain. I was failing this wonderful little boy, this child who had already brought incalculable joy into my life. He relied on me for everything, and because of my poor decision-making and my selfishness, I was letting him down.
That’s an incredibly hard thing to write even in your own journal, let alone in a book that hundreds of thousands of people will read, a book that has copies sitting in most of the bookstores in the United States right now.
Long time readers will recognize that I’m essentially retelling the story I talked about in an earlier post, The Longest Night (in fact, my first draft largely was a quote of that post).
When I’ve discussed debt repayment in the past, I’ve usually stated that the first step of the process is to come up with a debt repayment plan and sell off items that you’re not actively using in order to start funding that plan and get the creditors off your immediate back.
What I really neglect to say in those articles is something I cover intensely in the book: if the people in your life that you’re financially responsible for aren’t also on board with this plan, you’re wasting your time. To put it simply, if you can’t get your partner on board, the absolute first step you need to undertake is fixing your relationship with those people, because such a relationship based on divergent goals and behaviors isn’t working.
I was extremely lucky to find that Sarah was a more-than-willing partner in getting our financial lives straightened out. I originally wrote a description of how exactly we came to be on the same page that was excised from the book in later drafts, but I’ll share it with you here.
For us, this meeting of the minds was quite straightforward. We set aside an afternoon and simply went through all of our finances together. We talked about our dreams and our goals. We looked at our full debt situation seriously – nothing hidden or secretive – and we came to some very strong conclusions about what we needed to do with our money in the future. Our only real difference of opinion was how far to take our cost-cutting measures and over the following months we worked through those on a case-by-case basis.
The key to success wasn’t in that first meeting, though it did lay the groundwork. Our success was built on discussing and revisiting and refining all of this over time. We talked about what didn’t work just as much as we talked about what did work.
Another key was recognizing that we are both flawed people who make mistakes. Neither one of us is going to be perfect and a mistake isn’t a reason to argue or disrespect each other.
Much of the rest of the chapter focuses on what I would describe as the “nuts and bolts” of debt reduction: coming up with a debt repayment plan, reducing interest rates, and snowflaking are covered, among other topics. This is the type of basic personal finance stuff that shows up in almost every personal finance book. Why? It’s vital information to those struggling to overcome debt.
Yet, the idea that this book somehow focuses heavily on debt repayment strategies is basically false. In fact, debt repayment is scarcely mentioned again in the book. It’s merely one tool among many for building the life that you want.