Woman on the Verge… Of Financial Ruin

I used to make enough money to travel first class, shop at Bergdorf Goodman and own real estate in Manhattan. And then, after a series of very bad decisions compounded by the 2008 financial crisis, I found myself with no credit and so little cash, I couldn’t take the subway to a job interview. And that was before I hit bottom.

I am writing this from the other side, so the ending to this story is that I did survive, but it’s still a work-in-progress.

I am clearly no financial expert. I made some of the worst decisions possible, resulting in prolonged agony and crushing debt, but I eventually got down to business to right my wrongs, one step at a time.

#1 – Admit you’re in trouble.

It took me far too long to admit I was in trouble. The entire world was on the verge of financial ruin, but I was taking the collapse as my personal failure.

Leading up to 2008, I was successful by anyone’s definition. I was a single woman living and working in New York City and measured my success through things: a 3-bedroom cooperative apartment with Hudson River views, more shoes than I could wear, expensive rugs and on and on. I had a big bank account and was setting my sights on early retirement. I had dieted and exercised my way to a body that was attracting younger men and was living my life like Samantha Jones on “Sex in the City.”

And for the first time in my life, I thought I was in love. I didn’t count on him breaking my heart. It turned out his sweet nothings were lies and I unwittingly became the other woman. When he left my apartment for the last time, I fell into such a deep depression that I barely noticed the rest of the world collapsing. Money woes wrapped in love woes were a killer combination.

I refused to admit my world was falling apart. It was a secret and part of my ridiculous cover-up was to keep spending like everything was okay. That decision put me deeper in debt and further from any kind of resolution.

#2 – Learn to talk about money.

I never learned to talk about money. When I grew up, people simply did not talk about it. There was no discussion of salary, cost-of-living, savings or how to handle big expenses. I do remember my parents fighting about money, but it was always late at night, after I was in bed.

I needed to communicate about the relationship I had with money, but with whom? My two-timing love should have been that person, but wasn’t. I needed someone to share my hopes and fears about money with. I should have opened my eyes and admitted that my life was trending down. I also should have sought professional financial help. Instead, I fell down the rabbit hole for three more years, depleting my funds, including my retirement nest egg.

#3 – Answer the phone.

It’s not as easy as it sounds. I had pushed my credit cards to the limit without the money to pay the bills and was falling behind with everything. When creditors, including the IRS, came calling, I didn’t answer the phone.

It’s easy to drown in debt. It’s hard to cry on the phone to a stranger about credit card and mortgage payments. I think if I would have stopped pretending and answered their calls, I wouldn’t have ended up in as much trouble.

Make no mistake, falling behind with your creditors will kill your credit rating. They’ll close your accounts before you know what’s happening. It took me three years to face my new reality.

#4 – Taking stock.

Hopefully, your financial worries aren’t as dire as mine. When you’re in trouble, don’t let your pride get in the way. Take a job, any job. If you’re of a certain age, it won’t be easy, but every little bit helps. When you’re trying to rebuild your life without credit, you need cash. I took a job making cold calls and then working as a personal assistant. Eventually you’ll find your place again.

I needed an extreme-downsize. I sold my apartment and left the city I’d called home for the last 30 years to pay off my bills. Did I really need to live in a place that had more bathrooms than bottoms living in the house? No.

But the downsize wasn’t just about my home. I needed to take a look at what really mattered to me — friends who are there when I fall, believing in myself and finding real love. To understand that those were the things I needed was the silver lining in my fall.