Shock absorbers in action
DH = Dear Husband
Numbers for June
Once per month, I report on our debt-reduction and savings progress. In terms of numbers June was not stellar. Our goal each month is to put as much as possible against our mortgage up to a maximum payment of $3,000. As for savings, our goal for last month was to top off our emergency fund so that it would be 100% full.
What actually happened was that we put $2,200 against our mortgage (down to $104,000 now), and we didn’t save anything. We would have made a smaller mortgage payment if we’d known what was ahead of us.
Real story for June
The numbers aren’t the real story. The real story is that in June, we hit a significant bump in the road.
DH is self-employed. He’s been running a franchise successfully for seven years now. Let me say that again: “He’s been running a franchise successfully for seven years now.” Such a short sentence. It can’t convey the “Hallelujah!” inherent in it for us. DH’s successful business is the happy, happy resolution to years of career uncertainty and under/unemployment. It will be a long time before I take it for granted.
Although DH has a lot of autonomy in his work, certain things are standard in the company and otherwise beyond his control. For the most part, no complaints. In fact, it’s been a huge help to have a structure and network in place. But in June, there was a company-wide glitch that lasted a bizarrely long time and that had the impact of butchering business.
DH had absolutely no control over this business-stopping “technical difficulty” (sorry I have to be so vague about it), but it had a staggering control over him. It was something that blindsided all concerned, and it brought home to us the fact that there are no guarantees when it comes to DH’s work and income.
The crisis did eventually pass, but while it lasted, it was the focus of just about every conversation that DH and I had. What if it lasted for several months? What options did DH have? How would we absorb a possible huge loss of income?
DH carried an understandable amount of stress for those couple of weeks. But I carried almost none.
Shock . . . but a smooth ride
Let me say that again: “I carried almost none.”
A little over 3 years ago, still in the first 12 months of our journey out of debt, DH had slow business through the spring. Although I knew objectively that his income varied, that brief period of low income set me off. I wrote a post at the time about debt and depression, and how women in particular feel financial angst. “Dave Ramsey notes the same gendered difference in response to financial stress in his book, The Total Money Makeover. ‘Somewhere down inside the typical lady is a ‘security gland’, and when financial stress enters the scene, that gland will spasm’ (Ramsey, p. 144). My ‘security gland’ was in a spasmodic state for the better part of six years, so there is a trigger effect now, even though logic and perspective don’t justify it.”
Since that time, I’ve learned to go with the flow when it comes to our variable income. This past May, for instance, was possibly DH’s lowest income month ever, and that was completely OK. What happened in June was of a different order of magnitude. There was no “going with the flow”. There was no flow to go with. It was a random anomaly that we had no power to resolve.
And it didn’t stress me.
I was actually able to play the role of stabilizing spouse. DH’s day-to-day life was dominated by this crisis, but mine wasn’t. And so I listened, empathized, acted as sounding board, offered perspective, and confirmed our strategy. We’d batten down the hatches and be ready to respond to whatever was going to come our way. Ultimately, if worse came to worst, we’d close up shop and move. Significant, but nothing to get my “security gland” in a spasm.
Financial shock absorbers
So why the difference? Why were May and June of 2016 not difficult for me when March and April of 2013 were so depressing? I can think of 3 reasons:
- Less debt. In the spring of 2013, our business debt sat at about $65,000. Now, we have no business debt. Our mortgage debt was also about $43,000 more than it is now.
- More savings. In the spring of 2013, we had a mini-emergency fund of about $1,000. Now we have an almost fully funded big emergency fund that would see us through 6 months of expenses if we lost an income.
- Different attitude. “As you pay off your debt, you’ll realize it wasn’t about the money at all.” This statement, from Ramsey as well as other sources, annoyed me at first, but I’ve found it to be true. In 2013, the prospect of having to sell our house because we couldn’t afford it was mortifying. Now, there’s no ego obstacle to such a move.
I hope that “normal” will last through July – and many years to come for that matter. But if it doesn’t – if we hit more bumps in the road – I’m so glad we have these financial shock absorbers in place.
Would you say that you have “financial shock absorbers” in place? What is the most significant one for you? Your comments are welcome.
*Image courtesy of herrtichy
Thanks for reading our report for June ’16! Please check out my weekly posts at Fruclassity.