I have never written an article like this before, about becoming money literate.
But there’s something I want to talk to you about that is really business unusual for me. It’s something I feel strongly about these days. It’s something so personal to me, and probably also to you. So personal that the next aspect of my life I could also be open about is sex. It’s also a personal journey that I am really happy that I’ve begun and something I am proud of my progress in. Oh, and please beware that this is a rant. English is not my first language so there might be spelling and grammatical errors. Thank you for understanding as always =)
I have literally gone through a personal hell, financially, for the last 2 years. Yeah, I know we don’t talk about money. We only talk about money in terms of spending, saving, paying, or lending.
But I want to talk about how to manage them. I want to talk about money literacy.
Because basically, no one ever taught me. No one who wasn’t trying to get me to give them money at least. Now I have a personal financial advisor that I pay to help me be money literate. It’s just that I don’t trust banks anymore, not one bit. There’s something in the system that’s really broken and I could talk for hours about that part. But fellow bank clients who are stuck somewhere in a huge bank system, I feel for you.
Anyway, here’s my story…
The best and worst decision ever
It started when we made the best and worst decision ever. We tried selling our apartment while renting my parent’s house. If you don’t know it, I live in my childhood home and we haven’t bought the house yet.
Anyway, it took us a year and a half to sell the apartment for half of what it’s worth. 1 and a half years with 2 rents to pay and no money. Everything went into this big apartment/housing hole.
Oh yeah, and then there’s the debt from the apartment.
Oh and our “lovely” bank Nykredit concluded that, after we have paid ruffly 24,000 kr a month in housing costs for 2 places for 1 and a half years, we couldn’t afford to buy the house. Basically, because I ran my own company on my way up and that’s like extremely insecure apparently. Not a word on the hell we’ve been through. I can only imagine how Toothless Tiger and I worked 60 hours a week to be able to go through this. And if I should have done the same with a steady job, I would need an executive person’s worth of monthly payment. Anyway, on with the story.
Thank you Nykredit for nothing
Nykredit made us a loan to cover the debt for the apartment. Just mentioning it gives me cramps in my stomach. They made a loan with an interest rate of 13% because now that the apartment was sold, we did not “own” anything, and there was no way in hell they would let us borrow money to buy the house and take that debt as a part of the value of the house. They even told us that it was because we had an unstable economy. I think that’s what 24.000 kr a month in housing costs will do for you through 1 and a half years. It hasn’t just been unstable, it’s been a disaster. And you, my dear bank, hasn’t done anything to help me out. We.Have.Done.It.All.Ourselves. Thank you very much.
Right now, I am paying off massively on taxes because they need to be paid too. I’m paying so much in interest to the bank that it’s bewildering and above my imagination that they would ever treat their clients like that.
But I can see light at the end of the tunnel and there’s a new bank waiting to take over our “bad economy”. We can see the dreamhouse coming closer and closer to us. Enough bitching about the bank and the economy, here’s the positive side of things.
The changes I made after going through a financial struggle
If I should define a time period that has made me super adult and responsible, both as a part of a family and as a business owner, it’s the last two years. I have been unable to sleep, tossing, and turning. I have avoided the mailbox because I didn’t know what bills would be inside of it. And it became super clear on how I should spend my money as well as my time and my health. Friends have been fired. Dinner parties have been down-prioritized. Business processes have been changed. Networks and associations have been fired if they didn’t bring enough value. Meditations have been made. Exercise and long walks with the dog as well.
I taught myself how to manage money
The thing is that nobody ever told me how to manage my money, so I decided to learn it myself. Simply because I refuse to let this negative fact linger above my head saying, “I have a lousy economy”. I believe that we’re actually doing better than alright. I believe we’re doing awesome these days. However, I refuse not to talk about money at dinner parties and talk about how everything is just fine, what we WANT, what we need, how nice the house looks. I guess my point is that money really sucks.
I have friends that are more miserable economically than I am and people, on the other hand, who have so much money that it’s all they are, it’s what defines them! Now isn’t that scary?
The perk of investing for your children
I think it’s important we talk about how good it would be for our children if we put aside 20,000. While they are babies, we can let this money sit in a bank account. They won’t have any knowledge about this, not until they turn 33 and it is time. Then just when they come to you saying they want to buy a house, you’d be proud to say “Mama has got a little something for you”.
The steps I did, now being money literate
Anyway, I can’t live without money. So the last year, I have begun to become money literate. First, I dropped my prices in Toothless Tiger so much that the offers I send out were prices that clients couldn’t refuse. Then I fired the person hired by Toothless Tiger who was supposed to make sure that the economy was taken care of. I got a new person that takes care of everything around me and the economy. And then I started to look at my personal economy. What happened?
I took a closer look at the Danish site, spiir.dk, which helped me a lot with budgeting and getting a lot of the finances in shape. You can’t really use the U.S based services in Denmark because you can’t sync them up with your banks and you can’t import files. Then I decided to not get so frustrated about the fact that there weren’t any education, workshops, or articles about money in Danish.
I tried looking at American services and I ended up on a site that I fell in love with. I ended up on Learnvest.com, specifically in their boot camp section. You don’t need to use the system in order to get smarter about it.
Needs have to come first and Wants have to be rid of
I started to study things in there and then something happened last night, I started to delete accounts on the internet. Just-eat.dk went first because I decided that if we needed fast food we could pick it up ourselves. I can’t tell you how much money we spent on just-eat on a yearly basis but it’s scary. I got a smaller telephone deal and I also created a list of 15 things that need trimming and a ruff look at a lot of other things that are nice-to-have but not-need-to have.
Later today, a lot of my designer stuff from OLD (and less careless) times are going to be sold online. Budgets are made and will be kept. They will be presented on every board meeting I have about myself and my company each Sunday.