“It’s how you deal with failure that determines how you achieve success.” -David Feherty
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If you read Let’s get Married in Mexico, we sound like financial geniuses. We had a destination wedding plus honeymoon, a total of two weeks, for less than $10k. We started our marriage off debt-free.
Photo by Digipixart
That was until a series of events, first car purchase, Anna’s business, stolen car, and timeshare, happened that left us $35k in debt and added to the financial wedge between us, see Combining Finances. I basically said that I didn’t trust Anna with money. Way to go Adam…
In 2010, we bought Anna a new car.
Meet Sno Kone, a 2010 Subaru WRX.
We didn’t have to buy a new car, that is for sure. Anna was driving a 2000 Toyota Camry at the time. The cool factor was super low, but reliability was super high. It was purely a want. The way we justified the purchase was,
A. It was more reliable in the snow… (it only snows a few days a year in Virginia)
B. Anna deserves to get her own car, one that she wants
C. We could also save on maintenance because I (Adam) could take care of the basics
The car cost $32k. We put $10k down and financed the rest. We actually tried to go the trade-in route, but they offered such a low amount on the Camry that it was laughable. We ended up giving the car back to Anna’s parents, who then gave it to Anna’s brother. He is still driving the Camry today, twenty-five years later. In hindsight, we could have waited a few years and saved up more money to reduce the total cost of the car (purchase price plus interest).
So, now we have an auto loan for $22k, plus higher car insurance. But that isn’t the series of events I’m talking about. This is just the beginning.
In 2011, Anna decided to leave her office job after three years. It was a soul-crushing three years and she had had enough. All of her previous employment had been in the retail and service industry, which she tolerated better. During that time, she had also been working as a part-time wedding photographer and decided, she wanted to give it a shot as a full-time job. She left work and started shooting weddings full-time. It was actually a successful business. But seeing that I’m writing about it in a post about debt, it wasn’t all flowers, rings, and kisses. Money is needed to buy gear, create a website, put together price packages, etc. etc. After doing it for a few years, Anna and her body were worn out. Plus, we never got to see each other. She worked late on Fridays and Saturdays. I worked Mondays through Fridays. We might see each other a few hours during the week and never on the weekends.
With that in mind, she closed up her business and started a woman’s portrait photography business. On the plus side, she was working from home, during normal daylight hours. The downside, most people are off weekends and I had to be out of the house. We converted our first floor into a studio, where ladies would show up, get their hair and makeup done, and then have a photoshoot with Anna, looking all fabulous. Again, gear, website, price packages, sample work, etc. etc. After a few years, Anna decided to close up that business, to spend more time with me. Anna loved that business, but she loved me more. Our relationship was in a rough state at that point. We hadn’t spent a lot of time with each other for six years. Plus, we were starting the process of moving from Virginia to Colorado. Over the years, Anna had accumulated $10k worth of business-related expenses on a credit card with 22%~ interest.
Side note, in the period between when Anna closed her woman’s portrait business and we moved to Colorado, she started working at the front desk of a gym. If you know Anna now, this is that moment in her life that sent her on a completely different path in life to becoming a fitness and cycle instructor, but that is a story for a different day.
In 2015, we moved to Colorado with two cars. Rex (2004 Subaru WRX that was paid off) and Sno Kone.
Photo by Saperstobe Studios
In 2016, we paid off Sno Kone ***happy dance***. We then started saving that money for a future car, or so we thought.
Late in 2016, some friends invited us to a timeshare weekend. Side note, we are still friends with them.
We love being in the mountains. During the summer, we go hiking and in the winter, we go snowboarding.
We heard the pitch and decided to buy a studio timeshare for every other year. The cost was $18k. I’d like to go a lot deeper into this topic, but in a later post. We actually are really happy with this purchase. It is a guaranteed week at a ski resort called Breckenridge where we can walk out of our room and right onto the ski slopes. We also get free year-round parking, access to their seven movie theaters, pools, hot tubs, and so much more. We have used it every other year and have been really happy with it.
The problem was the timing of it.
In August 2017… I walked out of my office on a Friday to find my car broken into. They had stolen a few things that the insurance valued below $500 (our deductible). I reported it to my work (direct management and security), but because they only leased a few floors in the building, they weren’t responsible for the security in the parking lot. I also filed a police report.
At the time, I was working in a call center. Once or twice a month I would volunteer to work a weekend shift for some extra money. When I walked out of the building that Saturday (the day after the break-in) to go to lunch, I found my car missing.
In my car, I have a vehicle locating system in the event the car is stolen. That was the best $500 I ever spent. The person happened to drive past a sheriff and the computers in his car alerted him to a stolen vehicle. That led to a high-speed chase across Colorado, until my car ran out of gas.
During the few hours he had it, he had effectively totaled my car. Plus he had stopped by a pawn shop to unload as much stuff as he could. The dash under the steering wheel was ripped a part, broken 4th gear (stick/manual transmission), and damage to the driver’s side exterior.
I could write an entire series on that one day and the aftermath of it months and years later. Insurance wanted to total the car and give us $4k. Our response was… seriously? Instead, we said give us the $4k, and we’ll take care of the rest. We got the interior fixed, with a new ignition and door locks, and took care of the body. When it came to the transmission, we had three choices:
- Buy a new one from Subaru ($6k for the transmission alone plus removal/installation)
- Rebuild the existing one ($4k with new gears from a rally/race car including removal/installation)
- Buy one from another car that was in a junkyard ($500 plus removal/installation)
I decided to rebuild the existing transmission, but with super strong gears.
In total, it cost $8k to fully fix my car, but we only had to pay $4k out of pocket because insurance also gave us $4k. Side note, it has been eight years and I still haven’t replaced the missing audio system.
The guy was part of a car theft ring and we were able to break up the ring. He got eight years for the theft of my car, on top of all the other crimes he had committed.
But $4k was just a drop in the bucket in this debt equation post. That is because fixing Rex took over six months. My job required me to be in the office… I had to figure out how to get myself to the office or look for another job that I could walk/bike to. We initially looked at a cheaper car that was in the $15k range. We just weren’t happy with it and knew we’d only drive it for a few years before we got rid of it. Instead, we decided to buy a car that would make us happier. We ultimately bought a 2018 Subaru Forester named Fez. Tack on another $35k to that debt pile, plus registration, property tax, and insurance.
Totaling things up, from 2013 to 2019, we spent $67k on business expenses, timeshare, Rex repairs, and a new car purchase. To beat that debt down, I was averaging 500 hours of overtime a year to bring in extra money. It was life-crushing, but we had reduced it to $35k (business = $10,876, timeshare = $8,078, and Fez = $16,053). One night in 2019, I was exhausted and worn out from working twelve days in a row with some of those days being 7 AM to 7 PM shifts. I turned to Anna and said, we need to fix our financials by the end of next year or else…
Talk to you next month
