In the previous post we saw that after starting his new job, Paul was convinced by his co-workers he needed to buy a new car because his current car didn’t represent the image of those who worked at his company. We also read about Amy opening a credit card at the suggestion of her college roommate and how over time Amy was able to pay the minimum payments on the card. Now, we’ll pick up with Amy when she goes home from school over the Thanksgiving Break.

Amy went home to her parent’s house for Thanksgiving. While she was there she spent several days hanging out with her friends and going to dinner or shopping with them. Since she had become comfortable using the credit card, she frequently used it to pay for her purchases when she went out.

After she returned to school and received the bill in December, she found out it was more than she normally charged. She also realized that she didn’t have enough money to pay it in full. Her roommate told her to pay what she could and pay the rest off next month. Amy decided that was a good plan and sent the payment for what she could pay.

Hope’s and Tyler’s wedding day went off with very little problems. It seemed like everything was perfect. All of their family and friends were there and they all had an enjoyable time. On the flight to their honeymoon, they relished in the events of the day and how everyone had such a good time. This truly comforted them since they both put so much thought and money into their big day.

After they got home, they had their gift opening party. Many of their family and friends were there. During the evening, several people asked them if they had thought about buying a house. Tyler said they hadn’t thought about it since they had been so busy planning and preparing for the wedding and honeymoon. Many people told them they needed to get a house because neither of their apartments was suitable for a newly married couple. They were even told buying a house was the next step a married couple needed to do so they’d be prepared to start a family.

Both of them wanted children and figured they’d have them someday, but neither had given it much thought. Both sets of parents told them how much they were looking forward to having grandchildren. They also told them they needed an appropriate place to raise them and the apartment wasn’t suitable for children.

All of this talk about buying a house left Hope and Tyler overwhelmed. Each of them had decent jobs and were contributing to their retirement funds, but they didn’t have any money saved for a down payment. They were talking to their friend Marshall about buying a house and he told them they didn’t necessarily need a down payment depending on what lender they used. He said he and Yasmin got their mortgage with nothing down and a great interest rate. Hope and Tyler decided they would look into financing with their lender and start looking at houses.

Gabriela and her husband struggled for many years paying their bills while paying all of the medical bills for their child who was born with a rare blood vessel disease. One day in church Gabriela heard the church was offering a Financial Peace University class. She thought this may be a great way for her and her husband to get control of their money and stop struggling so much. They diligently attended the classes each week and learned a lot of information on how to change their current financial situation. Fervently they worked the Baby Steps and paid off most of their consumer debt.

However, they had been driving a used car for several years and this car required numerous repairs over the past year. They sold it and bought another used car. Again, that one also started regularly needing repairs. They sold that one too and bought another used car. Like before, this car started needing regular repairs after a while. This consistent pattern of having cars needing repairs frustrated them, so they decided they no longer wanted to deal with their car in the shop so often.

Out of this frustration, and though it went against the principles they learned in Financial Peace University, they bought and financed a new vehicle. The value of this vehicle was more than half of their income with payments over $800 each month. As you can imagine, the new payment put a strain on their budget and made paying off their debt even more difficult.

Besides their consumer debt, they had a mortgage to pay. With the mortgage, vehicle payment, and their debt snowball their income was pretty much tapped out. This wasn’t so bad until their well dried up and they needed a new one drilled. Between the plumber and well drilling service, they had to spend over $10,000 to have water in their house again. Sadly, their Beginner’s Emergency Fund didn’t make a dent in the cost. They went to their credit union and applied for a loan. The loan was approved and carried a payment of $350 per month.

While at a local festival, Luis and his kids were enjoying some of the food there. Suddenly, one of Luis’ teeth broke as he took a bite of his food. Almost immediately he felt intense pain from the broken tooth. He called his dentist, but they didn’t have weekend hours and referred him to one who does emergency treatments on weekends. After he contacted the emergency dentist, he went to their office.

Stay tuned to learn what happened with Luis’ tooth and explore how the use of credit has become so careless in our world today. We’ll also look at how we can change our outlook of using credit to keep us from remaining in debt our entire lives.

I hope today’s blog was encouraging to you and provided information to help you and others better handle their financial matters. My purpose through these blogs is to inform the reader about money and financial issues so that we all can become better managers of our assets. If you like what you read, make sure to sign up so you can receive my weekly posts. The goal of Take Two Financial Coaching is to provide the necessary information to help families and individuals break the chains of debt, build lasting wealth, and become outrageously generous.

For those who are tired of being in the rat race or just want to better manage what they earn, I am available to have a Free 60 Minute Conversation to discuss your situation and how I can help you change it. Go to my calendar at https://ramseycoach.com/taketwofinancialcoaching to arrange a time that works for you. You can also email me at taketwofinancialcoaching@gmail.