We had two boys one right after the other when we’d been married for about 5 years. While certainly not unexpected events, children brought with them a new level of expense we’d not anticipated. We bought a bigger house, we needed new cars. Our boys needed to fit the images and plans I’d been making for them. I found myself reliving my own childhood through theirs. By giving them everything I thought would make them happy, I was trying to do that for myself. I wanted them to fit in at school, at church, on the playground and on the sports teams in all the ways I’d wanted to fit in at their age.
Many times during those years, Harold came to the end of his rope with our financial situation. Reluctantly he’d agree to refinance our home. Because real estate values were increasing at unprecedented rates, we had equity–a fact that was always at the forefront of my mind. I knew that equity was an asset and it was our asset. It was a lifeboat tied to the side of our ship always at the ready if we needed it. We were young, retirement was a lifetime away and if we needed our money now, we should not hesitate to gain access to it. Even if the worse happened and we lost everything, we could just start over. I had an answer for everything.
Each time we took a ride in the lifeboat, we weren’t improving anything at all. We would only move our rapidly accumulating debt from credit cards to mortgage companies and banks. But in some strange way I believed the hype and ads that insisted we were being so wise and responsible by paying down our debts. It felt that way. We’d walk away from the bank with a nice big fat check, bring everything current, pocket the difference if there was any and feel so accomplished. So righteous. Another clean slate. Ceremoniously I would cut up all my plastic and pledge to never charge again just like at Thanksgiving I would always promise myself to never overeat again. My credit card pledges lasted about as long as my never-eat-again promises … until I got hungry.
Our home equity consolidation bailouts were never the solution. Sure they eased the pain for a time. But the cruel reality was that together with our other living expenses and payments, we never had enough.
Always the answer was more credit, higher limits, bigger payments, more credit, juggling balances, cash advances from one card to make the payment on another.