Yesterday was a great day. Probably better than yours, because I won the lottery!
Woohoo! The lottery! The ol' pick 5 came in and I'm the happy recipient of a cool 190K bucks!
Gotta take the lump sum and pay off the debts first, of course, THEN I'll blow invest half the rest and blow the remaining cash on something fun. A vacation!
Ooooh, I could go to Hawaii. Or Rome. Or over to Europe to see some friends and soak in the history. The Things want to travel, so of course they'll go too. Oh man, this is going to be great! A couple of weeks in Europe, taking the trains places, eating in little bistros and pastiserries, lounging by many an ornate fountain in the squares of small European towns watching impeccably dressed people glide by speaking undecipherable languages. I could lean French before I go....that can't cost too much money.
Provence. Milan. Prague. London. Paris. Frankfurt. Lisbon. All laid out there, waiting for me and my money. OMG I'm so excited.
OK, so if I pay off all my debts, including car loan and credit cards and 401K loan I just took to help pay down my debts, that will leave me with about...................shit.
If I pay off all the revolving debt and loans, I'll have eaten through much of my winnings. There's no way I could pay off the mortgage too, and then there's the half of the remainder to invest, and I don't know WHAT to do about that because really, if I was honest, ALL of it should be put into a short-term high-yield vehicle so I can make good on the promise to save 20K for each Things' college fund by the time they're 18 (which I KNOW won't cover the cost of school, but a more realistic goal would have caused my head to explode).
I should invest all of it. Almost all of it. OK, MOST of it.
Rome, Paris, Lisbon? Can you wait? For some other day? Some other windfall?
Y'all, I didn't really win the lottery.
From time to time I think about what it would take to get me completely debt-free, and as it turns out if I'd won yesterday's cash 5 it just about would have gotten me there, save for the mortgage.
Sobering thought, that one. My home and investments (401K is about it, y'all) are solid financial worth, but in the past year or so my debts have skyrocketed, what with putting a whole new life on credit cards. I did take a loan against the 401K in order to pay off the cards, and in 5 years will have paid that back with 8% interest...to myself (saving me thousands in interest to Banco Conglomo). Nothing not to like about that. It saves me several percentage points not being paid to the CC companies, and my goal of having one of them completely paid off by the end of the year seems doable if I really crunch. The other card is at an interest level that's about what the 401K loan payback is, so I have paid that down a little bit to improve the ol' credit score. There are some stocks I might to sell to get enough to pay off the car loan, which'll net me 150 bucks a month in extra cash to save or invest, or I might just take the next year of payments and then the loan will be fully serviced and I won't have to take the windfall tax on the proceeds of the stock sale...
Chipping away at the mountain of reality is a monumental task, but because I plan to be debt-free within three years (401K loan and mortgage being taken out of the equation) it's something that finds me taking the hammer and chisel in hand most days. While I don't wake up at night in a sweat over bills and how to pay them (thanks, new job!), neither am I at the point at which I have the mythical '6 months of income as liquidity' either, and there's no money in the Things' college fund, and if I should come up against a significant medical or personal issue I'd have nothing to fund recovery from that.
I'm probably like a lot of other people, which bugs me. This living on the financial edge is uncomfortable. I listen to far too much NPR to be able to ignore the global credit crunch, and I think it's only a matter of time before the lenders starts calling in their markers, ans it were, and I'll be left in the street because I don't have the wherewithall to fully pay off my debts right NOW. Your creditors can do that, you know. Just call you up and say "hey, is this my problem, is this my fault? Not it is not, and we want the gazillion dollars you owe us on your debt, RIGHT NOW."
That, my friends, should make anyone nervous.
This whole topic makes me nervous, but because I've been a card-carrying adult now for 25 years of so, I guess it's time to look at the bylaws to see what it is that adults are expected to so.
Something tells me that 'being expected to pay off my debts and help my kids through school' is in there somewhere. I could smack the bastards that put those in there, I really could.
Also, I've figured out that a lottery winning of about 4 million bucks would support me in the style to which I' grown accustomed for the rest of my life.
That's not a lot of money, people, if you're a movie star or pro bassetball player. Put into their contexts, it's 1/5th of a film or a month of play. What on earth do they DO with all that cash?
And how do I apply to the National Bank of George Clooney for a loan?
Enjoy your day, this depressing post notwithstanding. I'mma head out to work now, and try to enjoy those little gifts of cooler temps and plenty of sunshine on the ride.