CashI don’t mention it too often but one of the main reasons I started living frugally was because I didn’t want to get into another situation where I claim bankruptcy.

The process of claiming bankruptcy was eye-opening and frightening.

Frightening because the lawyer I hired to help me through this made it clear that some of my creditors may not want to be included in the bankruptcy and I would have to settle out of court with them, by that time I was worn down with phone calls I really didn’t want to deal with. However, it was also eye-opening about how easy it was, back in ’98, to get all of it wiped out and I owed no one but the lawyer. Of course that is before I realized the impact my credit score tanking would do to me.

I knew that I would have to re-establish credit because of the bankruptcy, but someone telling you and then going through it is two separate experiences.

In process of trying to re-establish credit, I came across more NO responses or 30% interest that it scared the be-jibbers out of me. I figured I was doomed for life! Or at least for the next ten years.

That is when I had to start living within my means. In Denver, it meant downsizing to studio apartment that is close enough to walk to work and getting rid of the car. It also meant using only the money I had on hand, cash.

Using only cash involved a few learning experiences:

1. Putting it off: I had to figure out my priorities, plan for emergencies and put off the others till later. My priority list was constantly in flux and I had to be patient.

2. I knew where my money was: Every penny I spent was scrutinized to determine if this was the best way to spend it.

3. Getting creative: Some things that were put off until later, were asked for as birthday or x-mas gifts. The ‘˜stuff’ in my home had little money signs on them for selling on eBay and there was the experience of learning that a thick, black blanket over the window to block sunlight, also warms your home to sauna like temperatures.

4. Tightwad shopping: This is where I learned the art of dumpster diving and making others trash my treasures. The same is true with grocery shopping. I had it down pat when the staples would be on sale and how much to get to last me until the next one. And any rebates or coupons that I found for things I already bought were not forgotten on the kitchen counter.

5. The power of advertising: When you have a budget to stay within, you notice all the advertising that tells you how much more complete your life would be with a cell phone that you can talk on in the desert. That, and how much more powerful you are at tuning it all out.

6. Limited giving: I made it clear to family that I had limited funds and asked for gift ideas that were under a certain range. Sometimes it meant going in together with someone else to buy a gift.

7. The power of ownership: There is nothing quite like being able to sleep in a bed or sit on a chair, that you know, you have paid for it in cash and don’t still owe on to a nameless creditor/bank.

The power of ownership gives me the shivers. To say to myself, I own it and it is mine, no one can take it back because I missed a payment. There were times I would pinch myself and have a goofy grin on my face because I was so happy.

As the anniversary of my bankruptcy nears, this urgency has diminished and the power of ownership now barely entices a grin, I not only want to remember, but need to remember the fear and frustration that debt caused me so I don’t do it again!

Additonal reading:
Moving the Score in My Favor

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Dawn C. is site owner of Frugalforlife.com and is residing in Colorado with her spouse, Teri, of 11 years. Dawn can be reached at Frugalforlife@gmail.com