Coming to terms with the economy

My dad grew up very poor. He was born on the heels of the Great Depression and times were hard. His father’s drinking further complicated the general welfare of the family. Dad was the oldest, and he and his younger brother learned how to earn money from a very early age in order to get their most basic needs met. He had some great stories and took pride in the fact that he rose above his upbringing. He wanted his kids to have more than he did. It was for this reason that he spoiled us a bit too much.

Dad was a multi-tasker and had an incredible work ethic. He started out selling Fuller Brush door to door. He went into the insurance business and later opened up his own independent agency. He purchased a large quantity of land which he simultaneously farmed, developed, and contracted into a subdivision during a building boom in the 70’s. Dad seemed to have the Midas touch.

When my brother, Frank, turned 15, he got his first car. Hotrods were the “in” thing in the mid 70’s so he chose a 68 Dodge Charger (like the General Lee on the Dukes of Hazzard). A few months later, dad also bought him a 71 Dodge Charger. They sold both of those cars and purchased my favorite of the rods, a 68 Cutlass Supreme Coupe. It was a beauty. Dad loved cars, too, so he indulged his inner child through us. Those were the days.

Frank is five years older than me and a couple of unexpected things happened during the time between his cars and mine: the building bust of the 80’s, dad sold everything and my parents moved back to their hometown to be closer to family. He opened a new insurance agency and my mom opened a retail clothing store. We are from coal mine country and there was a miner’s strike that lasted close to 18 months. Our local economy was in a shambles. They had to close the retail store at a significant loss. My mom got her first job outside of the family as an executive secretary so we could have money for college.

I had talked to dad for years about what kind of car I wanted. I really wanted a Corvette. In my mind, it didn’t have to be new, but somewhat new. (How generous of me.) So just before my 16th birthday, I started talking about my new ‘Vette. I thought I was entitled because of the precedents set with my brother and yet uninformed of my parents’ new economic changes since he started driving. Dad had to inform me that I would not be getting a Corvette, but he would buy me a nice used car. Being the 15 year old girl that I was (still naïve and not getting the message), I said that I would settle for a new Buick Regal. My dad was incensed and rightly so. He was furious with me and told me I was spoiled, to which I replied in my rebellious 15 year old voice, “Well, I didn’t get this way by myself.”

And as the old saying goes, “Aye, there’s the rub.”

In our current economy, we’ve become accustomed to the nicer things. As a nation, we’ve collectively purchased more on our credit cards that we should have. We have more credit cards than we should have. We don’t delay gratification by saving up to buy something. It has to be NOW! We’ve purchased homes we couldn’t afford. We trusted lawmakers to regulate fund managers and institutions who were making them rich. If we did happen to have enough discipline to invest in mutual funds, IRAs or 401k’s, we’ve sat watching that money evaporate over the last few months. We tried to keep up with the Joneses...and the Smiths, Copelands, Jordans, ad nauseum. Like the teenage me, we’re “spoiled”.

Finally, we are getting serious about tightening our belts. We are taking our finances seriously. Financial guru, Suze Orman, is talking about “How Much Can You Afford?”. Syndicated Radio Host, Dave Ramsey is talking about the benefits of being debt-free and cutting up the credit cards. Oprah is regularly hosting shows aimed at living within our means. Websites such as cheapskate.com and walletpop.com are getting record hits from consumers who want to know how to get out of the sea of debt and despair they’re in. People are admitting their financial crises and owning the responsibility. We are realizing that we have to be disciplined and discerning in all economies. We need to un-spoil ourselves.

Dad set off on a campaign to un-spoil me in the limited period of influence he had left on my teenage years. He humbled me by buying the ugliest car he could find-a ’71 AMC Matador. His plan included teaching me how to earn money. He got a great deal on my first car, and he allowed me to sell it at a profit and buy a nicer one at a good price. I did this seven times before I went off to college. I learned to search out a good deal and only buy when I could turn a profit. I kept trading up until I got a car I was proud of, a 4 year old Toyota Celica hatchback. I drove that car for four years. And though it was my nicest car as a teenager, the Matador is still my favorite car I ever owned to this day, because it represents a sense of accomplishment, my new skills of negotiation and strategic planning which serves me to this day.

As with all lessons learned, it helps to take the edge off by finding the humor in the situation. If you can, learn to laugh about this economy, and it will ease the pain of discomfort. My family and I have had exhaustive joke sessions at the expense of my old Matador. I cannot tell you how much I appreciate the fact that my parents decided to not over-extend themselves just to indulge my selfishness. I am so thankful for parents who loved me enough to tell me when I was wrong and teach me a better way.