Today the nation wakes up to a brave new world. In a much smaller and considerably less profound fashion, I find myself in unfamiliar territory as well. Three words. Credit Card Debt. As of today’s date, my personal debt load totals $15,166.13. This does not include car payment, student loans or any household expenses shared with my husband (these are minimal as my husband manages our household finances and is great with money) – this amount consists solely of my own personal nonsense and includes two visa cards and six store charge accounts (three with balances, and one of those three in excess of $1,000). My debt load (hereafter the “Number”) was considerably higher until recently – over the past four months I have paid down approximately $8,000 to arrive at the current Number. I would be proud to tell you that the paydown was simply prudent judgment in response to economic uncertainty; however that would be a stretch. The truth is that my employment situation is wobbly. Half of the workforce in my small firm was eliminated last year, and in addition no 2008 year-end bonuses were paid. More reductions in force are on the way, including my position. As difficult as it would be to be laid off, I dread the confessing the Number to my frugal husband, and subsequently accepting his help in servicing the Number, even more.
How could I allow the Number to grow so large? How does this sort of thing happen? I am a smart, professional woman. I work in finance. My base salary is very decent – even excluding bonus, this sum should enable a person to subsist very pleasantly in my particular metropolitan area, make a significant contribution to the household, and put something aside for a rainy day. Historically my compensation has been bonus heavy, and against all common sense, I have grown accustomed to a big fat check at the end of the year. I am baffled and still unraveling how the Number and I arrived here. Clearly, a combination of bad decisions, delusional thinking, over-application of retail therapy and general self indulgence is in play. As such, following are the major categories nominated for expense reduction/control/elimination near term:
· Handbags: I love, adore and worship Chloe handbags. Some love Gucci or Hermes or Chanel, but a Chloe bag is so perfect for me. I have 7 Chloe bags of various colors and configurations. All but two were bought on clearance, marked down by at least 40%. Sadly, even a severe mark-down may represent unseemly sum to spend on a handbag in the brave new world.
· Shoes: Occasional dalliances into the Jimmy Choo, however most are classics from Stuart Weitzman or Cole Haan. Also the occasional Chloe shoe, from the clearance rack of course. Many shoes are typically purchased in a season – I am hard on shoes and they do not last.
· Apparel: It should be much easier to reduce clothing purchases versus accessories. Given my penchant for the bag of Chloe, I compensate in other areas and will continue to focus on good quality basics from Brooks Brothers, Theory, J Crew and Gap. T-shirts and tanks from Target. I love Theory tees, and these can often be found on clearance (although arguably they are worth the full retail spend as they wash and wear like iron).
· Personal maintenance: This is a very important (and often expensive) category. As one nears the upper age quartile of the 25-45 year old female demographic, maintenance becomes very important, and one also becomes more sensitive about it. Highlights, cosmetics, skin care products, waxing (brows, bikini, leg and arm), nails and toes, regular Botox at crowsfeet (and occasional in forehead), fillers, laser for sun damage, annual varicose and spider vein treatment. Also laser removal of a small tattoo on ankle is in progress. Two years ago I spent $4,500 on Thermage with amazing results. A second round of Thermage is probably not an appropriate expenditure for brave new world, although clearly it is time. Also in the category of personal maintenance, I belong to a gym and intend to start using it again – maybe if I improve my body, my existing wardrobe will look better on it.
Drafting this post has taken me past the red zone for online shopping, and even though a new blue Chloe Heloise shoulder bag (clearance priced) would change my life, I staved off the desire to track one down this afternoon. Additionally, I am returning an adorable silk/wool leopard print trench coat from J Crew – sleeves too short. Another tenet of the brave new world is rejection of items that do not fit the bill 100%.
Total daily personal expenditures = $0, -$237 if the return of the return of the trench is included.