I saw an article on CNBC yesterday about “short sales”….it was a pretty generic article, but it was written in a very explanatory tone. While I did a short sale nearly two years ago, the term is only now becoming commonly known in mainstream America.
Foreclosures are soaring, bankruptcies are up….
I think I was ahead of the game. Ahead of the curve when it came to financial meltdowns.
Which is funny, because when money was flowing and home prices would “go up forever” (ala 2005), I was becoming broke faster than you can say “twitter”.
I think I just like to be different. When everyone is going left, I go right.
I’m glad I went through my short sale and bankruptcy when I did.
For all of my screw ups, I was pretty good at actually screwing up at the right time in my life. Sure, I wish I hadn’t ever lost all that money day trading, but hitting rock bottom sure as hell woke me up.
And now I’m stable. I’m still in debt. Still owe Mom over a hundred grand, but she refuses to charge me interest, so it’s a manageable debt to continue to repay over time.
I just sent off another 2.5K to the IRS this week. I’m getting closer to wrapping that debt up. I’m re-doing my 2007 return with the help of my accountant and once that is done, all I’ll have left to owe is around 6 or 7K.
But back to the recession.
Bankruptcy, foreclosure, short sale, debt….these are becoming more and more common words every day in the press. And even in everyday conversation.
I for one am glad the bubble popped. I feel for those who have lost their jobs or their life savings. That sucks.
But I needed a wake up call, and I think we as a nation are grinding our way through our own wake up call.
What do you think?
Will the recession change our spending and savings habits in the long term? Is the new focus on frugality and saving just a fad? Will it pass if/when the boom returns?
{ 2 comments… read them below or add one }
I’m a bit of a contrarian too:) I was kind of ahead of the recession in the sense that I was reading about it 3-4 years before it happened. Many people could see it coming who didn’t just pay attention to the superficial layers that the media provide. But just a glance through the NYT today and saw some scary phrases. Looks like things are getting worse under the veil of a “stable” stock market. Wonder what oil is going to do this summer.
I think the new focus on frugality is definitely a fad for those who only pay attention at the media/social peer group level of things. Everyone else is saving now, so it’s the thing to do. They see it in the papers, etc. so it becomes something people can talk about and have in common, I think – which isn’t bad in itself. And it’s better savings than something else, perhaps.
You might not be old enough to remember the recession of the early 1990s… but there was a ton of talk regarding frugality, savings, etc…. and people did – until the Internet boom/bubble – which went on to be replaced by the real estate boom/bubble. Prior to that, there was the recession of the 1980s (when unemployment and inflation were both high).
My parents grew up during the depression – they were both big on saving and only took out loans for a home mortgage or to buy a business. Living below their income was a high priority. For my mom, the depression was never forgotten – she grew up in a small one-room cabin (built by her father) on an indian reservation – there was no electricity or running water….. they didn’t own a car, but had a horse with carriage/wagon.
There will be people who take this experience and will learn from their past mistakes… there will be others for which this is a passing fad and once the economy turns, they will once again be chasing fast cars, fancy vacations, and bigger homes…. all “bought” on credit.