Like so many blogs financial or otherwise before me, the catalyst for such an endeavor stems from personal experiences. I have been working in the field of accounting and finance for almost my entire adult career and upon graduating college I began working for a mid size management firm, who employed many CPA’s, financial analysts and business managers. I was hired as a business manager in the entertainment division handling all the day-to-day financial and business affairs of various actors, writers, directors and anyone else who made their living in the entertainment industry.
My job was part financial advisor, part life coach while the biggest part of my day-to-day job was baby sitter. My position as a business manager would often give me a very intimate view of not only my client’s finances, but their personal lives as well. You’d be surprised just how much you can tell about someone by reading his or her credit card statements or cable bill. I knew far more than I ever wanted to know and more often than not, they would tell me even more. I quickly became desensitized to the $25,000 a month Amex bills and the ridiculous charges that came along with them. It was my job to make sure that these highly paid individuals remembered to pay their bills on time, pay their various assistants and staff, put money away for taxes, save and make smart business decisions while they, for the most part stayed lost in their own creative oblivion, not to be bothered with the mundane issues that we mere mortals have to worry about.
One would think that anyone making this kind of money would be easy to coach into making good business decisions, but that was far from the case. I often found myself having to schedule what I called financial interventions with clients who found it impossible to live within their fortunate means. I remember such a meeting with a client who had been acting in television for over 25 years and his wife, during which, I was practically begging and pleading with them to cut back on their spending and keep their credit cards below a certain amount each month. The very next day while at a doctor’s appointment, I got a call from the both of them, asking me “ how much money do we have to put down on a car?” They had called me from a Mercedes Benz dealership and were about to purchase a $90,000 car for the wife to drive. It was as if the meeting that the three of us had less than 12 hours prior had never happened.
You would think that a person in my position would take advantage of learning from other people's mistakes and not make the same ones myself. I thought the same thing; until I found myself slowly wanting to live the same way my clients did, with all the shiny new toys and latest gadgets. I found myself falling captive to the very same trappings that I had advised them against. My star was on the rise at the firm and so was my salary. I eventually went out on my own and started consulting and began to make more money then I ever had before and of course, I started to spend it accordingly. I wanted it all. I bought an overpriced condo, in a fancy neighborhood with a fancy car to match. Within my first 6 months of consulting, I went from living with 2 roommates to owning my first home, I went from driving a paid off 10 year old reliable Honda to a brand new Audi with a monthly payment that was equivalent to what I used to pay in rent. My new place looked like a page out of a Crate & Barrel catalog and the lifestyle I was living, in hindsight was just as two-dimensional. If I wanted something, I simply bought it. I was “the guy” who would be out having sushi and drinks with friends and pick up the tab just so I could show everyone my Gold Card and say things like “ I got this, it’s been a good month.” I used to despise people who would say such pretentious things; I used to want to punch anyone in the face who would say something like that, now I was “that guy”.
Then the economy started to take a turn for the worse, and in October of 2008 when Wall Street was on the brink of Armageddon, my life savings, which was almost 100%, vested in various stocks was completely obliterated. I remember vividly the day I found out how much money I had lost. I remember sitting on my Italian leather couch with its faux distressed finish and looking around at all of the other “stuff” I had accumulated and thinking to myself that there has to be more to life than this. I was 30 years old, in debt up to my eyeballs with a condo chock full of all of the things I thought I wanted, while I felt completely empty inside. So, after allowing myself to wallow in my own self-pity I decided to begin the slow and humbling process of going from nouveau riche to practical and sensible. I replaced sushi dinners with $5 foot-long sandwiches having one half for lunch while saving the other half for dinner. After almost 3 years of living in my condo, I was fortunate enough to find a buyer for both my overpriced condo and car within the same 6-8 month period. I started to visit Craigslist instead of department stores for furniture and appliances, and opted to “Dress for Less” rather than the premium plus retailers in which I had become quite the fixture. I managed to crawl my way out of the depths of debt, in lieu of filing for bankruptcy and now find myself renting a house with a backyard for my dog for less than half of what my mortgage used to be, while driving around in a 1995 Toyota Land Cruiser that has the best amenity any car can offer, being paid off! I may have a lot less stuff but with a lot more personal satisfaction. If I can help just one reader learn from the mistakes I made rather than having to create his or her own, then mission accomplished. All I ask in return is that you tell me about it and keep coming back for more!