She had made some progress on her debt. She is actually paying on all of it including the zombie debt so that is some progress. However her budget is so tight and forgets so many things that I am not sure how she made as much progress as she did. She is currently confusing cashflow with a budget which means she ignores the credit card purchases she is still making (but she won't do that any more, she only did that because of her break up *sigh*) so she really doesn't know how much she is spending.
She once again committed to a long term payment without thinking things through (yoga this time instead of a car) and we are going to have her move in with us for a couple of months so that she can build enough savings to avoid financial ruin if and when she loses her job.
My big concern is that she doesn't connect the dots in her finances. Even with cashflowing, she still wants to spend every last dime she has. I think it will take multiple sitdowns to help her with this. Course, since she will be living in my basement for a few months, I should have the time...
What's really sad, is that I know that I can be an impulsive big spender too but I have never ever pushed it this close and don't understand how she can be comfortable doing so. I suggested a cushion in her checking to avoid overdrafts in the future and she said that wouldn't work because she would spend it...I mean, how am I supposed to respond to that?
My friend makes me look like a saver
August 17th, 2009 at 01:54 pm
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My best friend is going to make $80K this year thanks to a well paying part-time summer gig at a hospital. This comment summed up her merry-go-round of financial issues (as long as we've been grown-ups, the lack of money management skills and responsibility has lead to most of her drama): "I don't know how much money I'll have to make to get me out of this situation." I can't even say anything to such a comment.
August 17th, 2009 at 03:14 pm 1250522048
If you like I can tell you the formulas I use and stuff--it's basic Excel stuff. I keep it in Google Docs so I can access it from any computer. It forces me to be very hands-on with my budget, which is the best for a formerly disorganized spender (I was much like your friend for many years)!
August 17th, 2009 at 04:25 pm 1250526300
The main problem is that she doesn't want to examine her past spending (because she prefers to think of it as a one time event) so she doesn't have an accurate concept of bills and spending money. She thinks the allowance she has alloted will cover everything even though it hasn't in the past. This I can actually sympathize with because I used to do it to myself. I think when she goes to move out of my basement and she finds that she doesn't have as much saved as she thought she would, it will probably sink in a bit more.
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