You would think that we learned our lesson last time. But no, we didn’t! We’re still making plans and counting on money that we don’t have on hand. We did it with the RV and we got burned. We didn’t learn our lesson and we did it with this trip and we just got burned again!
Here’s the short version: We took out a $10,000 personal line of credit to buy a vending business last year. Since then we had paid it down to $7,000. (We could have paid it off sooner, but instead of making principle payments as we had originally planned, we went out to eat … a lot.) It showed up as a credit card on my credit reports and every month Bank of America (BofA) would send me checks that I could write to deposit more funds into my checking account from this line of credit.
Well, before we left Brooklyn CM was running ragged trying to find a buyer for the business. I think the ever-increasing gas prices made people wary of what was otherwise a very good deal. We didn’t blog about it because it didn’t seem central to the point of the blog.
So on the last day before we left, we got a buyer and we sold the vending route for exactly $7000. Well we had decided to pay back $5000, keep $2000 for backup, and transfer another $2000 when we got to Hawaii because everything is so expensive. $4000 in debt didn’t seem too horrible considering this was going to be the trip of a lifetime.
Fast forward to yesterday — I called BofA to make a transfer into my checking account and my request was DENIED. They said my debt/income ratio was too high. I was flabbergasted because not only had I not gotten any new credit since last year, but I had paid all of my credit cards off! Besides, since when is your credit reviewed every time you try to charge something? What would have happened had I tried to deposit one of those checks they keep sending me?
I asked how long was it going to be before I could access the money and they sales associate told me 4-6 months!!! What good is a line of credit that you can’t use for 4-6 months?!? CM & I made a quick decision to just close the account. That way I can get the full $10k off of my credit report.
By the way, we also thought that making such a huge payment on the principle would lower our monthly payments — WRONG!! I found out yesterday that our high payments are staying the same, my giant payment only shortened the amount of payments I have to make.
(If this is my short version, I’d hate to see the long version…) So, now CM and I are in Hawaii with only $1200 left in cash. If we were hanging out at the beach, it wouldn’t be a big deal, but before we left Brooklyn CM let me know how excited he was to see the volcano. (He doesn’t get excited about a lot of things.) The trip to see the volcano is going to cost $900. I, the CFO (Chief Financial Officer), came up with a budget to still go see the volcano and only charge $500 or so on a regular credit card.
CM is dead set against it. This other card has twice of the interest rate of BofA’s. We didn’t speak much last night, just a series of glares back and forth.
Culture Sidebar: In Hawaii a mean look is called “stink eye”. An example sentence: CM gave me stink eye all night because I wanted to use a credit card to pay for our trip.
Arguments/disagreements about money can really spoil a vacation. It’s 6:30 am here, and I’m watching the sun rise over the ocean and trying to get back into the spirit, but I’m torn. We might not make it back to Hawaii again, so why not stretch to see the volcano? Even if it does mean 1 or 2 unwise financial decisions?
Daily Wisdom: Don’t go on a trip until you have all of the money for it in the bank. Otherwise, you’re asking for it.
What would you do? Give up and just hang out at the beach for 4 more days or would you throw caution to the wind and go see an active volcano??
July 29th, 2008 at 2:58 pm
I’m a big Dave Ramsey fan, so I would not go unless I could pay cash.
July 29th, 2008 at 10:17 pm
I know a little bit about Dave Ramsey. My problem is that every situation, in my opinion, is an exception. So nothing really changes. He did inspire us to get out of debt, but I’m all too willing to whip out the plastic.
July 30th, 2008 at 3:57 pm
Talk about a “Gift of the Magi” situation in real life!
It sounds like:
You want to give CM the gift of the trip to the volcano, because you know how much it means to him.
Perhaps he now does not feel comfortable with accepting this gift knowing the immediate financial consequences. Maybe he would prefer to decide that your family WILL make a return trip to Hawaii in the future and that he’ll see it then.
One thing I am learning is that money conflicts are rarely about money, and in my experience, more usually about emotions. Talk about it together and see what you come up with. Good Luck!
Meadow
August 4th, 2008 at 5:00 pm
Sorry for the delay. I was able to read your comment on my phone, but for some reason I couldn’t get it to post to the blog.
Anyhoo, thanks for the input. You’re right about the bigger issues. CM definitely feels that I don’t value his opinion. When he’s against us doing something I usually do it anyway and I say “You’ll thank me for this later.” Sometimes he does and most of the time he doesn’t. That’s a bad habit that I REALLY need to work on.