Tag Archives: friend

When a Friend is Deep in Debt

I’ve mentioned my friend Jessica* a few times before, often discussing her poor spending habits. Now, Jessica is a great girl with the best intentions. She’ll always put a friend or loved one’s needs before her own. I don’t have that kind of patience or selflessness, and I admire that trait in her. However, I’m worried about her debt, even though it’s not my problem, and wish there was a way I could help her.

This month, she revealed to me that she is $12k in debt. While that isn’t terrible, what is painful to watch is that this girl, with all her talent and skills, could easily obtain a job (even a minimum wage job) and pay off her debt within a year or two. But, being selfless as she is, she refuses to leave her administrative position with the family’s business, which has suffered greatly with the economic collapse.

Jessica consolidated a few of her credit card balances and has managed to pay off $3k of her debt, bringing it down to the current $12k total she owes. She works a few small jobs here and there, but what the small jobs do is make it impossible for her to obtain steady work. Without a college degree, I know it would be hard for her to find a decent job, but isn’t it worth working a job you dislike for a little while to pay off your debt and build an emergency savings fund?

It hurts me as a friend to watch her constantly worried about her debt, her bills, and how she’s going to afford the next month. She lives in a house owned by her parents so luckily doesn’t have to pay rent, but it sounds like there have been months when the parent’s house has been close to going into foreclosure. The whole family is so nice and I just wish I was rich enough to buy them all out of debt, but then I also wish I could buy the whole country out of debt and teach everyone to live within their means. Too bad no one would listen.

Today, I asked Jessica what games we’d be playing on New Years at her party night and she said she might buy a new game with her Christmas money. I just wanted to write back and say don’t buy a game, however much money you got, put that into savings. Pay down your debt. Don’t buy a game with it. But I can’t do that. I can’t help at all.

What would you do?

My friend and her boyfriend, I’ll call them Jessica and Dave, belong to a vacation club where they get a certain amount of points per year. They can either bank the points and roll them over to the next year, or cash them out in gift cards to use at hotels. Jessica is rolling in debt, but the whole vacation club is paid for by her boyfriend (which later turned out to be a big problem.)

I invited Jessica to go to a party with me in the city one evening earlier this month. She mentioned that she had all these gift cards left that were going to expire soon, so she decided to book us a hotel for the night so we could really have fun at the party. Personally, I thought it was kind of silly to book a hotel room for the evening when we live about 45 minutes away (I’ve done the sober up and drive home later in the night thing plenty of times) but she insisted that we might as well, since she had over $1500 in gift cards left that expire in February. So I said sure, why not.

She drove us to the city and wanted to get valet at the hotel for her car. That was $50 for the night. I suggested we put the car in a cheaper garage and she said it was no big deal because she would just pay for it with her points, so I said fine.

When we arrived to check in, I stood next to her and found out that she couldn’t use her gift card at check in because they need a credit card in case there are any damages to the room or other expenses that go beyond the gift card amount. So she gave them her credit card but it was denied. So I offered to put the room on my card for the time being. My friend assured me my card wouldn’t be charged and that she could use the gift card when she checked out. She had used the cards before with no problem at other hotels.

We went to the party and had a pretty good time. Drank a lot so it was nice to have a hotel room in the city. We didn’t stay at just any hotel, we stayed at the swanky hotel where the party was with a room that cost $270 a night after tax. But it was all going to be covered by Jessica’s gift card that she had to use up anyway. Or so I thought.

The next morning when we tried to check out, there was a problem. Because Jessica’s boyfriend’s name was on the gift cards, the woman at the front desk wouldn’t let us use the card. My friend begged and pleaded to no avail. Apparently she used the card without Dave around before and at another hotel they accepted it. But here, they wouldn’t. So after too long standing there and hoping the card would be accepted, we gave up. And the $330 charge went on my credit card.

My friend told me that she’d ask her boyfriend for the money and that he’d pay me back. The really awful part was that she couldn’t use the card to reimburse us because you have to use it at a hotel. I told her that it would be worth calling the vacation club right away and say the card was denied. She doesn’t have to tell them why, but if she can get her boyfriend on the phone maybe they would reimburse her. I kind of felt like an asshole trying to get her to do this since I also stayed in the hotel room for the night, but I didn’t think her boyfriend should have to pay an extra $330 for something he didn’t even get to experience. I know my friend Jessica isn’t the best with money and is so much in debt that she can’t afford the room either, so I offered to split the charge with her. So $175 down the drain for a night at a hotel that I didn’t need.

That was last week. I keep asking my friend to call the vacation club company but she hasn’t yet. Or she says she tries but they are busy. I don’t think she’s really trying. I’m sure her boyfriend will give her money for her half of the hotel room and eventually I’ll get that back, but I’m a little peeved.

Question is, do I have a right to be peeved? I accepted the hotel room offer even though I knew it would be expensive, as my friend said she needed to use up her vacation points and this was a small percentage of the ones she had left. She didn’t purposefully get the hotel and have the points not work, she didn’t realize that her boyfriend had to be there for the cards to be valid. On the other hand, why didn’t she realize that? And shouldn’t she make an effort to call her vacation card company right away to see if they would be willing to reimburse her from her gift card? What would you do?

What I’d Pay for Friends

I often fantasize about having a group of friends who I can go out and enjoy life with. Then I think about how much that group of friends would cost me, and I unthink that fantasy. Having a social life is expensive… at least dating my boyfriend is cheap, we barely ever go out. But friends… friends go to movies, go to clubs, go shopping, go to coffee, spend money…

It’s really bothering me that I can’t make friends around here. At least I’ve yet to figure out how to meet people who share my interests. I’d honestly love to find friends who like talking about investing and money… without looking down on me for now having a background in economics. But that’s tough to find amongst people my age. The type of friends I like are people who just love good conversation. And people who know how to be silly and laugh too. Do they exist?

My roommates are fun, but I can’t imagine having a lengthy conversation with them about investing strategies, or whether cash truly is king. So I write this blog, because I know out there in the PF blogosphere there are other people interested in this stuff. But where are they? Why can’t they be my friends in real life?

Or maybe I just don’t know how to be a friend. How does one find friends anyway..? In college it was a little easier. I was always shy, but at some point I got drunk and made some people laugh and they became my friends. Well, these days I don’t have any social contact outside of work and my performance stuff in the evenings.

Should I stop being so concerned about having a social life? I just feel like my life is so so great right now except I have no solid group of friends. And that depresses me. Quite a bit.

My Friend’s Giant Brick House

When I went back home over the Thanksgiving Holiday, I spent a little bit of time with my childhood friend, Sara*, who always had a bit of competition going with me. We were frienemies for much of our adolescent years, but as we got older we started to get along again.

This trip home I got to see her brand new house. While she’s still in school, she’s engaged to an engineer who seems to be footing most of the bill for the residence. To give Sara credit, she’s also working full time while studying full time. She’s also terribly judgmental and seems to think that if one is renting it’s silly because you should just buy a house. She also thinks her house isn’t big enough, despite that only two people will be living there and it has four bedrooms (two will be used for offices, one for a guest room.)

The other thing is, back on the east coast, you can get a lot more for your money. Her house, which cost about $475k, costs as much as a studio does out here in The Bay Area. Nuts. So she’s living an hour from NYC and can get a damn house for that. A nice house. With a pool in the backyard.

She is doing tons of renovations to the house (well, her fiance is… he’s redoing the entire inside.) She’s in charge of the design. He does the work. They both seem fairly happy about it. They own a home. Sara owns a home. She’s 25. Like me.

I got back to California a few days ago. The bright winter sun warmed my skin as I stepped out the door in the morning. I took my daily drive down 280, a highway which has a beauty that never grows old despite how often I drive it. I smiled because here I feel so happy, and what makes me happy here is entirely free. The nature, my boyfriend, the sun. Even my job – for the most part – makes me happy here. So I figure back east people need huge houses to decorate because everything else is so fugly. Or at least in Jersey, where I grew up.

Still, I’d like to own a house. At least, I think I would. But I’m not dating an engineer. I’m dating a guy who makes $17 an hour and refuses to ask for a raise. It makes me nervous that who I’m with defines partly what my life will be. When, or if I’ll ever be able to afford a house. And I’m jealous of my friend who is marrying a very charming engineer. And I wonder if I ought to be strategic when it comes to love over the long term. Or if I should just deal with the fact that I’ll be part of the disappearing middle class, able to rent but probably not to own. These sorts of things have me rather attracted to any men I meet who have that breadwinner sort of vibe. That’s a dangerous thing to feel… especially when there are so many men out there who take pride in making money. My boyfriend, on the other hand, would be more than content living in a cardboard box… as long as he had access to a daily shower.

So with him, it’s up to me to make my fortune. To earn it. And I don’t trust that I’m the type who can make that kind of money. I mean, enough to buy a house. A house in the bay area. With a view of something other than another house. And a little bit of land. And such.

What is my American Dream? Do I need to date someone different to achieve it? Should I be envious of my friend… or just determined to prove I can make enough money to support myself and live a life of relative luxury?

Oy, my friend is financially hopeless.

Sorry my blog has been hijacked my posts about my friend, but my financial situation is nowhere near as dire (or dramatic) as hers, and I feel like my blog title “Her Every Cent Counts” is more suited to her.

The good news is that today I think maybe I opened the door for the opportunity to help her budget and such in the future. We’ve agreed that I’ll help her come up with a budget if she helps me organize my room. Because my room is just as a mess as her bank account is.

The bad news is that the poor girl (and I don’t mean “poor financially,” although in some terms of the word that would be appropriate right now too.)

I’ve been covering her financial saga since last week, when I first found out just how deeply she was in consumer debt. Since then, things have taken a turn for the worst.

As I noted in “It’s None of My Business, But… Part 2,” my friend had a little collision with a parking meter the other day and chipped her tooth. The chip wasn’t that bad, but due to not having dental insurance and no emergency fund, the $300+ the tooth fix cost her today is going to put her checking account into the red once again.

But I also found out some other things that I couldn’t understand.

A few weeks ago she took a trip to LA with her friend who was auditioning for some reality TV show down there. This girl (the one in debt) is a really good friend (to a fault.) Both of the girls apparently didn’t really have the money to take a trip to LA, but that didn’t stop them.

That’s fine. The concern I have with the whole situation is that my friend, Lisa, as I’m calling her, paid for the entire price of both plane tickets on her credit card… which, since they waited till the last minute, was about $500 total. Her friend, I’ll call her Tammy, has yet to pay her back for the flight. She told Tammy that she could pay her back in installments, since she knows money is tight with Tammy too.

But now Lisa broke her tooth and needed to get it fixed. She has about $250 in her checking account and the tooth fix cost her over $300. She paid by check. Obviously this is not a good situation.

I felt the need to provide some advice on this situation, so I wrote to her and said that she should call the dentist and ask if they can hold off on cashing the check for a week or two. She needs the time to get the money into her account. Her mother might lend her the extra $100, but even if she does it will take a while for the check to clear. She’ll likely be stuck with overdraft fees.

After talking about this, I started to bring up how I’m really bad with budgeting and how I’m working on getting better at it. By leading in with talking about my bad spending habits (which exist, I’m not lying about them just to get her to open up) she told me about how she has a tough time budgeting. So then we got into talking about how I am now into all this personal finance stuff and I’d like to help her figure that out if she’ll help me figure out how to organize my room.

Hopefully this bartering arrangement will pan out.

That’s what friends are for, right?

All of this has inspired me to think about writing a personal finance book. I’ve always wanted to write a book, but never really had a topic I was so passionate about. I’m not sure I know enough about finance to write a whole book about it, but then again it seems like a lot of idiots rewrite books in the self-help section and with a pretty cover and tantalizing descriptions, people still buy them.

It’s None of My Business, But… Part 2.

So that friend I wrote about the other day… the one who is maxed out on her credit cards, works a part-time job and earns less than she spends more often than not… ended up accidentally chipping her tooth today. Besides it sucking that she now has a small chip in her tooth, the biggest problem is figuring how to pay to get it fixed. With no dental insurance, no room left on her credit card, and no emergency fund… well, I’m not sure how she’ll figure this one out.

As a friend, I really want to lend her the money to get it fixed. But I realize friendships can end badly the second money gets involved. So I’ll stay out of it. I figure her well-to-do boyfriend can help her out if worst came to worst.
Still, it’s times like these when I wish I could say “you know, if you put the money you spend on your 2-day trip to Los Angeles, and the shoes and sunglasses you got there, into an emergency fund, these awful accidents wouldn’t have to be that bad.”
Of course, I just hold my tongue. It’s not polite to say such things to friends.
It’s one thing if you are trying hard to be frugal and you’re in debt, its another if you’re just over spending when you’re making enough to live a comfortable life on your income. I don’t understand how people can do the latter. 

"It’s None of My Business, But…"

My good friend has a problem with money. I want so desperately to help her get on the right path, but anything I say would come off as judgmental.

My friend, let’s call her Lisa, is an intelligent 20-something gal. She has a high school degree but dropped out of college because it wasn’t for her.

Her parents own two smallish houses in an area where real estate costs an arm, a leg, and a gold mine. She lives in one of them. She doesn’t pay anything for rent, etc.

Her parents also own a small business. She works for them part time. Since I’ve known her, the business has been struggling a bit. They’ve kept it going, but her paycheck of something like $1000 a month doesn’t always come in on time.

Lisa is knee deep in credit card debt.

Lisa owns a few pets. She recently bought a dog. She loves her dog. But the dog costs a lot of money. She’s already paying to take care of a cat and a bunny rabbit.

Recently, Lisa went on a trip with a friend who was auditioning for a show down in Los Angeles. While they didn’t stay in a luxury hotel, Lisa did pay for airfare and half of the rental car. According to her blog, her friend didn’t plan in advance, so she had to put the rental car on her credit card, which just happens to already be maxed out. Lisa took the trip just for her friend, and she’s only staying for two days, basically to wait for her friend to audition, and then return home.

It’s none of my business, but I just want to understand why someone so deep in credit card debt would buy a dog and take an unneeded trip. These purchases add up fast.

I guess some people live their lives just accepting credit card debt as the norm. But I don’t understand how they do this.

I want to help Lisa get out of credit card debt. The friend side of me wants to lend her money to pay of her credit card bills so she can not be taking on such high interest rates. But I couldn’t do that because the likelihood of that scenerio ending pretty is rather low.

Do any of you have friends who just spend, spend, spend without thinking about their credit card debt? Have you ever tried to step in and help?