The Financial Confessions: “I Ignored My Bills, And It Almost Ruined Me”

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“The other day, while talking to a friend about her car, I realized that I hadn’t paid my car loan payment in a few months. Or, if I’m being honest with myself, that I had very intentionally let my car loan payment ‘slip my mind’ for a few months.

I told myself that everything would totally be fine as I dialed my lender, only to learn that unless I paid $600 by Monday, my car would be repossessed. And because I had been late on too many payments, they couldn’t extend the deadline or help me out.

I had to call a family friend and ask for help, which was embarrassing and demoralizing.

I work in politics, and every year after Election Day, I’m unemployed, usually for a month or two. Despite the fact that I knew that I would be out of work and wouldn’t have any income, I put no money aside throughout the year, spent like crazy, and just assumed, as I always have, that things would just somehow…be fine.

This was a rude awakening, to say the least, and I’m lucky that I have friends that have the means and are willing to help me save my car. I’m also lucky — luckier than most — that I was able to line up a job very quickly, and that I qualified for unemployment so I’ll have some help in the interim weeks. But after this — and after reading the Financial Confessions — I started using Ready for Zero and Mint. (Mint showed me that I spent most heavily during months where my income is lowest, interestingly. I wonder if I overspend to try to convince myself that everything is fine.)

I’m trying to learn to think long term. It’s so hard to do when you’re young (I’m turning 25 next month). I had the option to live at home my first year out of college but insisted on moving in with my boyfriend. Surprise, we broke up. And I got stuck with paying $1,200 a month in rent for a nice apartment in a crappy neighborhood in Brooklyn. If you are fortunate enough to have family that can offer you help or financial assistance/support, take it if you need it. I wish I had asked for help. Or that I had even reached out to my dad and asked him for help in writing a budget, or explaining how my credit score is generated, or what credit card bill I should pay off first.

Learn as much as you can about debt, about your credit score, about budgeting, because even if you’re caught in a veritable financial nightmare, you can get your head above water if you can understand what’s holding you under. All of this happened after, last year, I defaulted on my student loans. Because my mom is my cosigner, she wasn’t initially able to cosign a loan for my little brother’s college education.

I called the lender — I don’t know why I didn’t do this earlier — and learned that I could retroactively defer payment, and so it was as if I had never missed a payment. Everything wound up working out fine in the end, and my mom was able to cosign my brother’s loan, and he is about to finish his first semester in college.

It was another head in the sand moment for me — ignore the problem and it’ll just resolve itself. That is (clearly) not the case, and I really can’t emphasize enough exactly how lucky I am that none of my financial screwups have done the full damage they potentially could have.

My hope is that this time next year, I will, for the first time in my life, have a savings account, and I hope to make it through the coming year without missing any payments or ignoring my bills.”

-Anonymous
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  • alyjarrett

    You “hope” next year that you’ll have a savings account and won’t miss any payments? You better do more than hope–you need to plan. I appreciate this confession, even though I cannot relate to it at all. I just cannot fathom purposely ignoring a bill and thereby destroying my credit. Youth is a poor excuse for stupid mistakes, given that there are plenty of people in their 20s who are extremely organized and have no problem thinking long-term. Pay off your student and car loans immediately, so you can save an emergency fund for periods of unemployment, and then start investing for retirement.

    Oh, and never, never, NEVER co-sign somebody’s loan. Despite the severity of the author’s mistakes, her mother’s is the biggest financial d’oh! moment of them all.

    • Sarah C

      I agree that the author should definitely plan instead of hope, and I, too, don’t relate as much to her mistakes, but we can’t assume that everyone can pay their student and car loans “immediately.” And it’s tough for most 18 year olds with little credit history to sign for student loans without a co-signer. Maybe it was her mother’s way of helping out as much as she could. It’s not so black and white here.

      • alyjarrett

        I don’t ever remember needing a co-signer for federal student loans, and if those aren’t enough to attend school, and Parent Plus loans are also needed, then that student should re-evaluate their choice of college. Even though I only graduated with about $8,000 in student debt, I wish that I could go back in time, select a cheaper school without taking on any debt whatsoever, and work my way through. Debt is not the only option.

        • meep

          my parents def needed to co-sign federal loans for me, so that part i find less silly but i agree with your overall reaction to this.

        • Heather

          You need a cosignor for federal loans as well. I know this because I cosigned for my sister’s fed loans. She is attending the cheapest state school in our state (which still costs a pretty penny). I agree with every point that you made, except the last part where I will have to respectfully disagree. It’s always a risk to cosign, but it’s not a mistake to put your faith in hard-working young family members. Obviously sometimes they disappoint you, but if you don’t have faith in them, who will? I’m not going to withhold the opportunity to go to college from my sister, just because she “might” flake on me…she’d have no other way to attend otherwise.

          • alyjarrett

            Thanks for adding your perspective. I do admit that I am much more risk-averse than the average TFD reader, and I wouldn’t even co-sign for a family member. If I was in such a situation, I would probably suggest that my sibling attend community college for two years, work on establishing good credit via a secured card, and save money from a part-time job during that time to cover the costs of transferring to a state university.

    • How would an 18 year old with no credit history qualify for student loans if their parents didn’t cosign? It’s risky, sure, and I wouldn’t recommend that one does it for a significant other or friend, but it’s a pretty normal way for parents to support their kids when they’re just starting out.

    • What’s wrong with cosigning a loan for your child to help them get an education? Things could go wrong but life is not all about thinking of only yourself. Besides that’s not just somebody, that’s her child! You didn’t have any right to make any judgment on the author’s mother.

  • Tara

    This person works in politics? No wonder we’re totally screwed. (A peon, sure, but seriously, if you can’t handle very basic personal finances, I don’t want you working in politics.)

    • We’re far more screwed by politicians who cite Onion articles as fact and who deny that climate change is a reality than a campaign staffer who hasn’t learned how to budget yet.

  • Some of these comments are super judgmental, self-righteous and making huge assumptions. How nice for alyjarrett that, as someone who has stated multiple times in comments how much money she makes, that she “can’t fathom purposely ignoring a bill.” How thoughtful to give unsolicited financial advice to a person whose name she does not know. How helpful to comment that you don’t want them working in their job. The author was writing a cautionary tale so take it for what it is; a live and learn moment. I always thought the whole point of the financial confessions was to allow people to admit their mistakes and not judge them or pat ourselves on the back for being better. Seriously people, do you realize how pointlessly negative these comments are? How does tearing an anonymous financial confession author down do anything productive to advance honest financial discourse?

    • alyjarrett

      I understand that not everyone will take my stance on financial issues, because personal finance is just that–personal. However, I take issue with your argument that my income reflects my ethics. Even when I was making much, much less, I still could not understand letting things slip and walking away from my bills. Organization and integrity can be achieved regardless of take-home pay, and even if I was struggling financially, I would do my best to be transparent and honest with creditors to work a payment plan. Avoidance is never the answer.

      • I never argued, or even implied, that your income reflects your ethics. I would agree that there is nothing “ethical” about your income. I was genuine when I said it’s nice that you can’t fathom ignoring your bills and that your financial choices have worked out for you. For what it’s worth, I feel the same way. But I chose not to make 3 comments responding to this article in which I talk about how I would never fall victim to her mistakes. We get it, you are not the author, you didn’t make these mistakes, kudos to you (seriously).
        When Chelsea started this site she said a big part of it was owning up to and learning from her financial mistakes and that seems like what ther author has done. I think (for me an others) alot of the site’s draw and success stems from the fact that no one judged Chelsea for her financial mistakes or said they would have made better choices or offered unsolicited advice. I’ve made thoughtless comments on TFD in the past and then thought twice about my tone and whether it was really coming from a positive place. I really hope other commenters do the same.

        • alyjarrett

          I think we all can agree that TFD is telling the personal finance stories that no other site is telling, and I would not want to detract from its open and honest dialogue with what I admit can often be an incendiary tone. If it means anything, I appreciate commenters like yourself for reminding me to check my privilege and practice empathy, because goodness knows I’m certainly not perfect, financially or otherwise. I don’t want to derail this thread even further with my comments, so I’ll just end this by saying that I respect you and the rest of the TFD community, even when I come off a bit troll-y at times 🙂 Mea culpa!

          • Aw thanks:) And you should totes write an article about your financial journey. All your comments make me curious.

    • meep

      …i mean i think a key aspect of publishing your work online is understanding that people are going to react to it and express those reactions? also, i frequently learn just as much from the comments sections of TFD pieces– disagreement, judgment, and all– than from the pieces themselves (and oftentimes more than the pieces) so i don’t exactly see this as “pointless” either.

    • I think a lot of the issue is that she describes her situation by saying she purposefully decided against paying her bills, and is then surprised that there were repercussions. If you keep reading it sounds like she got saddled with a lot more rent than she’d planned on once she broke up with her boyfriend and had to prioritize bills, but that’s only a sentence lout of the whole essay.

      I think there would be a lot less criticism if she wrote about how breaking up with her boyfriend led to a a wake up call about her financial situation and how she’s planning on not letting that happen again instead of ‘I decided not to pay my bills and was surprised bad things happened’.

    • buckwheat

      I had a lot of “head in sand” moments when I was in my early 20’s. Even now. They weren’t financial, but I read this with a lot of empathy. I’m surprised others didn’t.

  • meep

    i appreciate the spirit of this confession but i have to admit as someone who just turned 25 (literally two weeks ago) it really really irritates me when people in their early-to-mid-twenties blame their financial mistakes on being “young.” like if you are old enough to decide to move in with someone, to buy a major asset like a car or sign a lease, to work a full-time job, you probs aren’t “young” enough to blame financial mistakes like this on being a silly young’in. particularly when i know so many people in the same age category taking so much more ownership over their finances…like call yourself lazy, irresponsible, whatever, but 24-year-olds blaming their financial issues on immaturity, of all things, is really annoying sometimes.

    • alyjarrett

      Amen!

    • Heather

      Agreed! Everyone makes mistakes, but own your mistakes, instead of blaming it on youth.

    • SC

      totally! I had an ex who had so much credit card debt that he wouldn’t tell me how much it was – and he blamed it on being young. he had gotten into this debt when he was 27-29…

  • Emily

    Dear writer,

    My heart goes out to you. I am not sure what your upbringing was like, but my parents’ difficulty managing finances and controlling natures gave me a lot of anxiety around finances – paying bills and thinking about money would reduce me to a ball of stress. And I do corporate M&A and financial analysis for a living – so for me at least it wasn’t a question of not knowing, but of the anxiety overruling my judgement. I found I couldn’t address things in one fell swoop – I sort of just shuffled forward making slow and steady progress on this issue. A few things that helped me:

    1) for bills that reoccur every month for which the ramifications are drastic if you can’t bring yourself to pay them: autopay. Especially now, all my providers send me text messages before the money leaves my account

    2) Have your living expenses be as low as possible without negative repercussions (ie Herculean commutes, unsafe living spaces). I’ve found this reduces my anxiety because I know my fixed costs are low

    3) autodeduct a portion of your paycheck into a savings account so it’s off limits to you. This way it won’t even go into your spending calculus when you look at your bank balance.

    4) Consider using YNAB or MINT or your bank may have a calculus that shows what you are spending on. This sort of thing (the apps weren’t as available a couple years ago when I tackled this but I know ppl have had success with them

    5) Either have a friend you trust / boyfriend / family member / free financial counseling service help you set up a framework. I found that when my then boyfriend now husband helped me and said “you should keep your car payments in x range, rent / housing in y range, put z in your 401k and w in other savings” I was able to follow this framework I was just too anxious to develop it for myself.

    I don’t mean to project here – I hope you make baby steps forward, but the stuff above worked for me. In general, when I looked at the big picture of financial management it became a giant anxiety Everest I couldn’t summit, but when I broke it down into small things like “set up x autopay, renegotiate auto insurance on y date, look for car with max price of z” I slowly built myself to a good place without even realizing it.

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