When was the most stressful financial time in your life?

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Rexindex
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When was the most stressful financial time in your life?

Post by Rexindex » Wed Apr 13, 2016 8:29 pm

What was the most stressful time in your life financially and what did you learn from it? What if anything did you change after that time in how you handled your finances?
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ddunca1944
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Re: When was the most stressful financial time in your life?

Post by ddunca1944 » Wed Apr 13, 2016 9:04 pm

My first divorce. I was young, had two children to support, limited skills & education. Eventually I got a good job, but even after remarrying, did not quit. I had learned that life is uncertain and my own paycheck was the best security. I learned that financial security, was necessary for me to sleep at night.

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Re: When was the most stressful financial time in your life?

Post by goodenyou » Wed Apr 13, 2016 9:44 pm

When I finished my education and training and I was 6-figures in debt. Having a negative 6 figure balance sheet was stressful. I learned to LBMM and make debt reduction priority number one. I learned the value of being financially disciplined and the fleeting thrill of material consumption.
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JDCarpenter
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Re: When was the most stressful financial time in your life?

Post by JDCarpenter » Wed Apr 13, 2016 9:52 pm

Moving states in mid 40s; DW having to pay year's net income in malpractice tail to prior state; starting practice again in new state, where I was not licensed to practice and three kids in their teens; prior dream house (in which we had ignorantly put most all of our non-retirement monies) not selling for a year, resulting in ongoing large mortgage payments while we rented much smaller space.... Combined with kids who had advanced academically past the point where the local public schools were willing to help them (pre-internet learning options).

Learned to live on a hell of a lot less money for a couple of years as our income hit levels not seen since DW's residency when she came out of her guaranty (I was still not working for pay....). Makes us confident going into retirement that if our portfolio demands it, we can comfortably chop spending by 50% or more and remain happy.
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MrNewEngland
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Re: When was the most stressful financial time in your life?

Post by MrNewEngland » Wed Apr 13, 2016 10:01 pm

I've always been very worried about money. It's in my nature to worry about it. I always constantly tried to look up where I was in terms of net worth and retirement money and really fretted about it.

Then two months ago I got let go from the first job I ever had that paid me decent money. I panicked for about a week then something happened. Basically I just said f*ck it. I went to Florida, went back home to CT to see my nephew, went to LA to see an old friend, spent a week in Charleston, and basically just kinda did whatever I want.

I'm now finally looking pretty seriously for work but this has altered the way I am going to look at money. I'm not rich, but worrying about it isn't worth ruining our best years.

frugalprof
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Re: When was the most stressful financial time in your life?

Post by frugalprof » Wed Apr 13, 2016 10:42 pm

In the fall of 2008 I was applying for tenure track jobs and I still had not finished my dissertation. Two schools were interested. However, in November one of them had to drop its search because of the stock market crash. The other had over 150 qualified applicants vying for the position. My wife and I both had student debts to repay, and she was pregnant with our second child. Our son was born in December. Even when I got an on campus interview I remember thinking, "There's less than a 50% chance I get this job." I was offered the position in mid-March. Until that point I was an emotional wreck.

I learned that there is only so much you can control in life. I am hard working and disciplined, but in this case I was just lucky. Still, I think about all of my friends who worked just as hard for 5 years or more on their PhD and were not so lucky.

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Re: When was the most stressful financial time in your life?

Post by mortal » Thu Apr 14, 2016 12:05 am

In college, I was in walmart buying groceries, and I went to checkout, and my debit card was declined. Curious, I walked over to an ATM to check my balance. I was absolutely floored when I read $1.76. My scholarship money was apparently late, and the school had debited the remainder of my tuition from my bank account. My income was $621 / mo from disability. I pushed my cart aside, bought a bulk pack of ramien and went home. Not the worst moment of my life, but I vowed to *never* find myself in such a precarious situation again.

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wander
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Re: When was the most stressful financial time in your life?

Post by wander » Thu Apr 14, 2016 12:28 am

I once carried $10,000 balance credit card. It took me a long time to pay it off. Lesson learned.

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LowER
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Re: When was the most stressful financial time in your life?

Post by LowER » Thu Apr 14, 2016 3:28 am

......
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4nursebee
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Re: When was the most stressful financial time in your life?

Post by 4nursebee » Thu Apr 14, 2016 5:43 am

I've always had food on the table and a roof over my head so really have no idea about financial stress. I ignored plenty of bills and the subsequent phone calls. I got on state sponsored health plan for a few months and took food stamps for a month.

But America is a great country and when I was sick and tired of being sick and tired I got my S**T together and made something of myself. No great lessons, just plain old growing up.
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corysold
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Re: When was the most stressful financial time in your life?

Post by corysold » Thu Apr 14, 2016 7:58 am

Right now. Trying to transition from no monetary policy to a good one. Trying to unwind years of bad choices and poor decisions and realizing all of the lost opportunity cost.

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Re: When was the most stressful financial time in your life?

Post by firefly201270 » Thu Apr 14, 2016 8:26 am

Right now as well, for me. My husband is in his 4th year of doing post-doctoral research, and is now giving up on academia (there are no jobs!) and transitioning into industry. I finished my phd 2 years ago, and became a stay-at-home mom, but I am also trying to now find a non-academic job now. Even though we both studied STEM subjects, it's been very, very hard. He studied math, and I studied science, but our research was very academic-oriented, so it has been a lot of work trying to re-train ourselves and learn new skills that employers find desirable (i.e. programming, machine learning, etc.). While we have a big safety cushion, due to a generous grandparent's trust fund account set up for my husband, it feels very stressful to not have steady income, to not be on some kind of career ladder, and to feel that all of our education and training was essentially useless. We are over-educated for entry-level jobs, but lack industrial experience for any higher-level jobs. And I honestly would love to have any kind of entry-level job, but I'm certain people are afraid to hire me because of my stupid advanced degree. Anyway, we just try to remind ourselves that this too will eventually pass, and we won't end up homeless on the street. But, yes, it's stressful!

anonforthis
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Re: When was the most stressful financial time in your life?

Post by anonforthis » Thu Apr 14, 2016 8:35 am

The most stressful financial time when I was from 5 to 16 years old back in my old country. My parents worked from sun up to sun down to be able to buy food for us and we still went to bed hungry every night. Finally, our dream came true. The US government approved my dad application. I got my first job at 16 year old in the US and blew my first paycheck on the box of Snickers candy bar.

Andyrunner
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Re: When was the most stressful financial time in your life?

Post by Andyrunner » Thu Apr 14, 2016 8:51 am

I have been very fortunate I have not been in many troubling positions but I would say first year out of college. My parents didn't teach me a whole lot about money and spending habits.

I was making 39k out of college in a job I hated. I was fortunate enough my parents paid for college, but upon graduation I was on my own. I had little financial knowledge and 2-3k in my savings account. I had to put down money for an apartment, buy a bed, and other basics to live (pots/pans, table, chairs, etc). I didn't learn overnight but I learned budgeting fast. At one point, after a night in the ER for a separated shoulder, I learned besides the 5% I was saving for retirement, I was only building maybe $200 a month in my savings account. No way would I be able to pay my medical deductible (hell I had to learn what a deductible was). Over the next year I got a roommate, learned most store brand food is just as good as name brand food and focus on reducing my hobby expenses.

Nine years later with a frugal wife, kid, and house. Only debt we have is the mortgage, which is half the amount we have in our 401k's.

quantAndHold
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Re: When was the most stressful financial time in your life?

Post by quantAndHold » Thu Apr 14, 2016 8:59 am

I worked my way through college without much parental support, working a minimum wage job. Sometimes I had to collect cans to be able to buy food.

Everything since then has been a picnic, relatively speaking.

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Toons
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Re: When was the most stressful financial time in your life?

Post by Toons » Thu Apr 14, 2016 9:08 am

When I was eating "bread soup" and broke.
Age 19. :happy
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midareff
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Re: When was the most stressful financial time in your life?

Post by midareff » Thu Apr 14, 2016 9:10 am

Rexindex wrote:What was the most stressful time in your life financially and what did you learn from it? What if anything did you change after that time in how you handled your finances?
Divorced and trying to pay support, alimony, mortgage, car payment, regular bills, lawyers and find enough money left over to both eat and live indoors. Lesson? Prenups. I still remember it took me four months to save $10 to go out after work on a Friday night and buy 2 drinks. Promised myself never again, and that was nearly thirty years ago. Old habits die hard so I only recently gave up picking up pennies, but that's more arthritis than anything else. If I'm going curb diving at least leave me a nickel. :mrgreen:
Last edited by midareff on Thu Apr 14, 2016 9:18 am, edited 2 times in total.

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Sheepdog
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Re: When was the most stressful financial time in your life?

Post by Sheepdog » Thu Apr 14, 2016 9:14 am

The most stressful which stands out is when I wrote here on October, 9 2008 at the peak of the last major crash which you can read at viewtopic.php?t=25126[quote] I have been retired for 10 years. I am one who has said over and over again. Stay the course. Look for the long term. Yeah, sure. That's fine until today. Today did it. I am just starting to be scared so that I won't tell my wife what happened today...stocks down...bonds down...I'm down. Our retirement funds are sucking down the drain. I lost today alone a year's worth of normal distributions for expenses. I keep thinking tomorrow will be a turn around. I have said that for 30 days.
I am 25% capitulating tomorrow, maybe 50% to money markets....maybe all.

This is not me. I will see tomorrow.[/quote]

It was stressful, very stressful. What I did to change can be found in the rather long thread. It worked out okay as I wrote just a little more than a month later on November 19, 2008
As I bring this thread back from the dead, I think...I did not sell some of my holdings at the low, after all...my years of savings keep going lower and lower and lower in perceived value.
Retirement can be stressful.....but fun. Okay, I've gone over the cliff.....
No, I'm foolishly not selling any more for at least 3 years....
Sigh......
I can sleep soundly tonight. I hope you will as well.
It was the most stressful financial time for me.
Jim
Last edited by Sheepdog on Thu Apr 14, 2016 9:18 am, edited 1 time in total.
It's not what you gather, but what you scatter which tells what kind of life you have lived---Helen Walton

Non7WoodUser
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Re: When was the most stressful financial time in your life?

Post by Non7WoodUser » Thu Apr 14, 2016 9:16 am

Still eating bread sandwiches for lunch due to the horrific economy - no pay raise, no bonus and no overtime pay. It's a mess.

barnaclebob
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Re: When was the most stressful financial time in your life?

Post by barnaclebob » Thu Apr 14, 2016 9:39 am

Nothing has been really stressful so I'm very lucky. I had $1200 in liquid cash after I closed on my house and didn't have credit cards.

However I had recently been given control of a custodial account but in my mind that money was not available to spend on anything nearly no matter what since I didn't earn it.

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Re: When was the most stressful financial time in your life?

Post by stoptothink » Thu Apr 14, 2016 9:45 am

LowER wrote:Divorce: there is no substitute.
Yep. I was 28, just starting my PhD. I had spent the last 5yrs and almost my entire lifesavings putting my wife through dental school. She started the marriage with low/mid 5-figures in undergrad and car debt, and zero savings. She left it with no debt, a completely paid for DDS, $10k in cash from when she cleaned out our EF the day after we separated, and pretty much every material item we had accumulated as a couple...after having not worked a day. I began the marriage with no debt and low 6-figures in savings/retirement assets- left it with nothing but ~$20k in my Roth (which she tried to go after in court) and two plastic tubs which held all my possessions after having worked at least full-time time the entire way.

I was never afraid that I was going to be homeless or wouldn't eat, but I had spent the last decade living like a pauper and saving every penny so that I could take care of her and invest in our future, just to be left with almost nothing. At least I went through that experience relatively young and without any children involved. In the past 6yrs I've completely rebuilt myself and then some, thanks in large part to much better decision-making with wife #2.

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Re: When was the most stressful financial time in your life?

Post by dsmil » Thu Apr 14, 2016 9:45 am

Probably moving to DC after graduation with my fiancee in 2009, meanwhile my future employer was having layoffs and pushed my start date back a few months. I went around looking for a job that I could hold for a few months before starting at my CPA firm, and was scolded by the manager at CVS for showing up in shorts while asking for a job application. What was I supposed to do, where a $1,000 suit?

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Tamarind
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Re: When was the most stressful financial time in your life?

Post by Tamarind » Thu Apr 14, 2016 9:46 am

I'm really enjoying this thread because of the diversity of experiences. Some of us have experienced more severe stress than others but these are great reminders that with a plan, support, and some luck we can get past the stress eventually.

2011-2012 was the worst for me. I'd bought a house the year before. Amazing location, fixer-upper, and I love the place, but it was just barely manageable with payments on a 15-year mortgage eating half my take-home pay.

At the end of 2010 my company went under. While I managed to avoid being unemployed, I had to take a less-skilled job at a 30% pay cut and move from a small software company to a huge university. The environment was a terrible fit for me and I was miserable. The mortgage was now swallowing 60% of my take-home pay even while renting out a room to a guy I was rapidly coming to hate. I was converting my emergency fund into mortgage payments and Roth IRA contributions, and I knew the clock was ticking for me financially to get a better job. It took a year and a half.

I think many would say that my problem was caused by too much house, and they might be right, but it worked out for me. The right job allowed me to more than double my income and build a different career, and I still love the house, have done most of the work on it myself (with attendant mental health benefits) and will own it free and clear by the time I am 40.

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Re: When was the most stressful financial time in your life?

Post by Runner01 » Thu Apr 14, 2016 9:59 am

Thinking back, I have had a pretty blessed financial life so far (I am 30). Not because of an inheritance, trust, or high paying job but more because of a combination of always having a penchant for living below my means/saving money and because even when I worked low paying jobs I was able to work unlimited overtime.

But to answer the question, the most stressful time for me was probably last year when my son was born and I decided to go back to college full time for my bachelor's (I had an associates degree). Between a combination of paying the bills for my son's birth (~$7k), paying for my full time tuition ($15k), and my wife reducing her hours to 1 day per week, we had a negative savings rate for the first time in my adult life. In hindsight I shouldn't have been stressed at all because we still had at least a year of living expenses in cash. I guess it is all relative.

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Re: When was the most stressful financial time in your life?

Post by jabberwockOG » Thu Apr 14, 2016 10:17 am

The most financial stress I have ever experienced was a couple of times when we bought houses before selling our current house. In the first instance 22 years ago we had 2 mortgages at once although to my house relief the old house sold within a couple of months. In the second instance we had only a relatively small home equity loan but the old house took 5 months to sell and close. I don't recommend buying new house before selling old house - definitely not for the faint of heart.

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Re: When was the most stressful financial time in your life?

Post by SQRT » Thu Apr 14, 2016 10:23 am

Worst was during the financial crisis of 2008-2009. I had just retired in 2006 and in addition to my leveraged portfolio, had significant uncashed employee options. As I recall my net worth declined by about 75% and for a while it looked like I might have to go back to work. Actually dusted of my resume and sent it around. By the end of 2009 it was back to where I started. Current financial position seems rock solid compared to that. Never want debt again.

A close second was during my divorce. I was 42 years old and the child support and alimony represented about 75% of my income for a few years. My net worth was negative. She got all the hard assets and I had to pay all the bills. I was never a day late or a cent short. She still lives in the very expensive home we bought when married. Luckily my compensation grew faster than alimony payments which weren't finalized for another 15 years when I retired. Worked out fine for everyone in the end but for a while it looked pretty grim. Hard to learn from this one other than be careful before getting married (would be difficult to put in practice). Or as some think, don't do it again. Luckily married to spouse number 2 for 21 years and couldn't be happier.
Last edited by SQRT on Thu Apr 14, 2016 12:45 pm, edited 3 times in total.

Stupendous
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Re: When was the most stressful financial time in your life?

Post by Stupendous » Thu Apr 14, 2016 10:24 am

I've been blessed and have never been financially stressed and I'm mid-30's now. I finished college with $40K in savings because of my conservative parents and their help and was too cheap to buy a house in 2005/2006 with 20% down so I didn't screw up my life that way like so many of my peers.

I always worry about money so that helps me. That contributes to my large savings rate and the way I think about things. Unfortunately worrying about money is also why I'll never marry. The divorce stories scare the crap out of me and I would never mentally/emotionally survive that financial stress.

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Re: When was the most stressful financial time in your life?

Post by michaeljc70 » Thu Apr 14, 2016 10:38 am

2009. I had made some bad bets (mostly on bank stocks) and saw my investments drop almost 85%. I had even used some HELOC money to buy stocks (it was a small percent before the crash, but after a 85% decline, it was relatively big). I was also not working (by choice, but finding a job when I needed one at that time was not easy). It was depressing.

Luckily, I was in my 30's and had time to recover. I stuck with my strategy and I bought triple financial ETFs with my remaining money (I know, crazy). It all recovered and I now have more money than I ever did.

The lessons learned were diversify- even if you are "sure" something will go up. It may go up, but who knows how long it will take and how low it will go first. The other is to never use borrowed money to invest. This was a lesson I should have already learned from buying on margin previously.

I now have 95% of my funds in 1 Vanguard fund (target retirement). I always wanted to beat the market. Sometimes I did. Sometimes I didn't. The peace of mind of matching the market is invaluable.

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White Coat Investor
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Re: When was the most stressful financial time in your life?

Post by White Coat Investor » Thu Apr 14, 2016 10:38 am

Rexindex wrote:What was the most stressful time in your life financially and what did you learn from it? What if anything did you change after that time in how you handled your finances?
College.

I don't want to ever be poor again.

Make more money.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

2015
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Re: When was the most stressful financial time in your life?

Post by 2015 » Thu Apr 14, 2016 10:51 am

Sheepdog wrote:The most stressful which stands out is when I wrote here on October, 9 2008 at the peak of the last major crash which you can read at viewtopic.php?t=25126[quote] I have been retired for 10 years. I am one who has said over and over again. Stay the course. Look for the long term. Yeah, sure. That's fine until today. Today did it. I am just starting to be scared so that I won't tell my wife what happened today...stocks down...bonds down...I'm down. Our retirement funds are sucking down the drain. I lost today alone a year's worth of normal distributions for expenses. I keep thinking tomorrow will be a turn around. I have said that for 30 days.
I am 25% capitulating tomorrow, maybe 50% to money markets....maybe all.

This is not me. I will see tomorrow.
It was stressful, very stressful. What I did to change can be found in the rather long thread. It worked out okay as I wrote just a little more than a month later on November 19, 2008
As I bring this thread back from the dead, I think...I did not sell some of my holdings at the low, after all...my years of savings keep going lower and lower and lower in perceived value.
Retirement can be stressful.....but fun. Okay, I've gone over the cliff.....
No, I'm foolishly not selling any more for at least 3 years....
Sigh......
I can sleep soundly tonight. I hope you will as well.
It was the most stressful financial time for me.
Jim[/quote]

Having just retired ten months ago, the thought of having to go through what you went through scares the hell out of me. It must have been pure hell being torn between stopping the bleeding of your retirement evaporating and anguishing about staying the course.

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Re: When was the most stressful financial time in your life?

Post by Ninegrams » Thu Apr 14, 2016 11:22 am

Sequential job loss during a recession coupled with separation( followed by divorce ) was kinda hairy. Having a few ( operative word) bucks in the bank made it tolerable but just barely. My nice townhouse overlooking the bay became a studio flat facing a 7/11. My one year old Honda Accord morphed into a $300 jalopy I got off my brother. I was a saver before that experience, became something of a fanatic after it. Never underestimate the ability of a bad situation to get worse...rapidly.

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Re: When was the most stressful financial time in your life?

Post by UADM » Thu Apr 14, 2016 11:23 am

The interesting thing about this thread is that multiple people got cleaned out by divorce and then went ahead and did it again, while claiming to make better decisions. You could live with someone the rest of your life without the risk of being wiped out, but you chose the same risky path. I guess I just expected more bogleheads to learn from their mistakes. To be fair, one poster did say that he didn't do it again.

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Re: When was the most stressful financial time in your life?

Post by lthenderson » Thu Apr 14, 2016 11:32 am

My most stressful financial time was immediately after college. I paid for my own way through college but had about $200 in cash when I graduated and I had made my first month and security deposit for the apartment in the town where I moved to for my first job. My employer paid bi-monthly so that $200 had to last two weeks. It seemed like for the first year, I was living paycheck to paycheck, slowly outfitting my apartment with things like beds, plates and such. I was so tired of sitting on the floor eating Ramon noodles that rarely to this day do I do either of those two things and I don't remember those initial days out of college. The whole experience drove home the point that I never want to live paycheck to paycheck for the rest of my life. It sucked!

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Re: When was the most stressful financial time in your life?

Post by FelixTheCat » Thu Apr 14, 2016 12:05 pm

LowER wrote:Divorce: there is no substitute.
+1

Highly litigious ex-wife took me through a drawn-out divorce/custody battle. She told me "It is easier to sue you than go out and make my own money."
Felix is a wonderful, wonderful cat.

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Re: When was the most stressful financial time in your life?

Post by edge » Thu Apr 14, 2016 12:06 pm

An investment bank I worked for went under. Unlike many of my peers, I had a big cushion but the subsequent savings drain and the fact that my local job search wasn't great became stressful.

I ended up getting a position with a 2x total comp than my previous one but we had to relocate.

We can control somethings but not everything. It only took just a few cowboys to blow up the bank.

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Re: When was the most stressful financial time in your life?

Post by flyingbison » Thu Apr 14, 2016 12:07 pm

2001-2016, so far.

gbru316
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Re: When was the most stressful financial time in your life?

Post by gbru316 » Thu Apr 14, 2016 12:07 pm

Right now. Wife can't work (and hasn't been able to since late 2014) due to disability but SSDI hasn't been approved yet. Said disability required purchasing a more expensive home and new vehicle.

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Re: When was the most stressful financial time in your life?

Post by stoptothink » Thu Apr 14, 2016 12:25 pm

UADM wrote:The interesting thing about this thread is that multiple people got cleaned out by divorce and then went ahead and did it again, while claiming to make better decisions. You could live with someone the rest of your life without the risk of being wiped out, but you chose the same risky path. I guess I just expected more bogleheads to learn from their mistakes. To be fair, one poster did say that he didn't do it again.
Do you refuse to drive ever again because you once got into an accident?

That is quite a depressing opinion you have there. I did learn from my mistakes. The 2nd time around I made it very clear that financial responsibility was one of the major attributes I was looking for in a spouse, I refused to get married without a prenup, and most importantly I didn't dismiss possible warning signs as I had the first time. If we are only talking dollars and cents, my wife has been the primary factor as to why I was able to more than recover financially in 6yrs; she's very financial responsible and makes nearly what I do.

A successful marriage is a wonderful thing, it's a shame that'll you'll never experience it.

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Re: When was the most stressful financial time in your life?

Post by Chadnudj » Thu Apr 14, 2016 12:30 pm

Rexindex wrote:What was the most stressful time in your life financially and what did you learn from it? What if anything did you change after that time in how you handled your finances?
Easily the 9.5 months I spent unemployed before (3.5 months) and after (6 months) the birth of our first kid. Got laid off (firm was struggling), and the job search took much longer than anticipated.

What I learned?

1. Network always. Having solid networks really helps get your foot in the door for interviews.

2. Ruthlessly cut expenses when you lose your job -- the sooner, the better. We had moved about 2 months earlier into a (in hindsight) expensive rental, thinking my job was safe and we'd rent for a year or two before deciding where to buy permanently. Once I got hit with the job loss and it became clear I'd be searching for awhile, we talked to our landlord about getting out of our lease (we ended up having to eat the security deposit which sucked, but it was a sunk cost). It ended up being a huge savings. Also, related....

3. Reach out to family and friends for help. After we got out of the lease, we moved in with my in-laws to have the baby/while my wife was on maternity leave. It ended up being a huge help financially (no rent for 4 months) and generally (it was nice to have their help with meals, etc. while we got used to being parents). When we moved back to our city at the end of my wife's maternity leave (and with me still unemployed), a close friend of hers rented us her 2-bedroom no frills garden apartment at a ridiculously low rent for as long as we needed it (which ended up being 7 months). Countless other friends lent me a place to crash on job interviews, connected me with people they knew at companies I was applying with, and/or otherwise offered to help.

4. Stay frugal. Once I found a job, we stayed in the cheap rental for about 5 months, even though it meant more time sleeping on an air mattress/baby in a pack'n'play/no sofa (we kept all our furniture in storage). That allowed us to quickly grow back our cash pile (which had only been impacted in a very minor sense despite my long layoff, thanks to us cutting expenses), and actually buy our current condo (which has total mortgage/association fees/insurance/taxes that are combined around $500-$600 lower than our expensive rental, and is nicer to boot!).

5. What else helped? Having cash savings -- the whole 6 months emergency fund is DEFINITELY high on my list of best financial advice you can have/take. Hell, go up 9 months to a year if you can.

And how did this advice turnout? I track our net worth monthly. In the time from me losing my job (May 2014) to starting again (mid-March 2015), our net worth.....INCREASED, from about $69k to about $85k. Now, a lot of those gains were illusory/non-liquid (Zillow value of a rental house that I own increasing kind of dramatically; gains in retirement accounts), but even in pure, liquid cash terms we only went down $14k in cash (from $49k to $35k) in that time (and probably even not that much, truth be told -- our debt actually went down $4k in that period, too, so we probably were only down $10k in cash).

So cut expenses, network/apply everywhere, ask for help from friends/family, and have a good cash buffer.

Random Poster
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Re: When was the most stressful financial time in your life?

Post by Random Poster » Thu Apr 14, 2016 12:32 pm

Ninegrams wrote:Never underestimate the ability of a bad situation to get worse...rapidly.
True. I once had a string of bad luck and thought to myself, well, it can't get much worse, only to find out the next day that my car had gotten stolen during the night.

Or, in the words of Chris Hadfield, in regards to the possibility of you yourself causing things to deteriorate: "there is no problem so bad you can't make it worse."

UADM
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Re: When was the most stressful financial time in your life?

Post by UADM » Thu Apr 14, 2016 12:39 pm

stoptothink wrote:
UADM wrote:The interesting thing about this thread is that multiple people got cleaned out by divorce and then went ahead and did it again, while claiming to make better decisions. You could live with someone the rest of your life without the risk of being wiped out, but you chose the same risky path. I guess I just expected more bogleheads to learn from their mistakes. To be fair, one poster did say that he didn't do it again.
Do you refuse to drive ever again because you once got into an accident?

That is quite a depressing opinion you have there. I did learn from my mistakes. The 2nd time around I made it very clear that financial responsibility was one of the major attributes I was looking for in a spouse, I refused to get married without a prenup, and most importantly I didn't dismiss possible warning signs as I had the first time. If we are only talking dollars and cents, my wife has been the primary factor as to why I was able to more than recover financially in 6yrs; she's very financial responsible and makes nearly what I do.

A successful marriage is a wonderful thing, it's a shame that'll you'll never experience it.
There is no way to get around town, in most US towns, without a car. There is also no way to use a car without potential risk. This is why it is a terrible, terrible comparison.

Living together for the rest of your life is functionally exactly the same, with no risk. There is almost no actual benefit to marriage and you are giving away 50% of your life's savings in order to get that.

You can "make clear" whatever you want. Prenups are also broken all the time. You are taking a huge risk, with almost nothing to gain. You can choose to have the exact same thing without the risk. And dollars and cents, if you lived with her, the effect would be the same. The choice is yours of course, but the idea that people think they've learned from their mistakes and then put themselves into the same risk again(less with a prenup for you) is not exactly financially prudent.

As for picking a partner, there are ways to reduce risk, but people change over time. This is unavoidable. There is still massive risk in marrying vs simply living together for the rest of your life. It is a depressing opinion that you need a government financial contract to have a "wonderful thing" like a successful and happy relationship in order for the relationship to be successful and happy.

Ricky Gervais has been with the same woman for 30 years and they aren't married. To suggest that his relationship is worse off because of a lack of a financial contract is silly and naive. Not everyone is affected by societal pressure.
Last edited by UADM on Thu Apr 14, 2016 12:44 pm, edited 1 time in total.

SQRT
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Re: When was the most stressful financial time in your life?

Post by SQRT » Thu Apr 14, 2016 12:42 pm

FelixTheCat wrote:
LowER wrote:Divorce: there is no substitute.
+1

Highly litigious ex-wife took me through a drawn-out divorce/custody battle. She told me "It is easier to sue you than go out and make my own money."
Exact same as my X. Hell hath no fury...... My divorce took over 15 years to finalize. Several millions paid to her and still counting. But she will never be happy no matter how much I pay her. And I will never be unhappy no matter how much I have to pay her. :D

stoptothink
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Re: When was the most stressful financial time in your life?

Post by stoptothink » Thu Apr 14, 2016 12:43 pm

UADM wrote:
stoptothink wrote:
UADM wrote:The interesting thing about this thread is that multiple people got cleaned out by divorce and then went ahead and did it again, while claiming to make better decisions. You could live with someone the rest of your life without the risk of being wiped out, but you chose the same risky path. I guess I just expected more bogleheads to learn from their mistakes. To be fair, one poster did say that he didn't do it again.
Do you refuse to drive ever again because you once got into an accident?

That is quite a depressing opinion you have there. I did learn from my mistakes. The 2nd time around I made it very clear that financial responsibility was one of the major attributes I was looking for in a spouse, I refused to get married without a prenup, and most importantly I didn't dismiss possible warning signs as I had the first time. If we are only talking dollars and cents, my wife has been the primary factor as to why I was able to more than recover financially in 6yrs; she's very financial responsible and makes nearly what I do.

A successful marriage is a wonderful thing, it's a shame that'll you'll never experience it.
Living together for the rest of your life is functionally exactly the same, with no risk. There is almost no actual benefit to marriage and you are giving away 50% of your life's savings in order to get that.

You can "make clear" whatever you want. Prenups are also broken all the time. You are taking a huge risk, with almost nothing to gain. You can choose to have the exact same thing without the risk. And dollars and cents, if you lived with her, the effect would be the same. The choice is yours of course, but the idea that people think they've learned from their mistakes and then put themselves into the same risk again(less with a prenup for you) is not exactly financially prudent.

As for picking a partner, there are ways to reduce risk, but people change over time. This is unavoidable. There is still massive risk in marrying vs simply living together for the rest of your life. It is a depressing opinion that you need a government financial contract to have a "wonderful thing" like a successful and happy relationship in order for the relationship to be successful and happy.
You're welcome to your opinion about the institution of marriage, but stating you were disappointed that so many Bogleheads didn't learn from their mistake is not a statement I expect to be up for long.

Heir-A-Parent
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Re: When was the most stressful financial time in your life?

Post by Heir-A-Parent » Thu Apr 14, 2016 12:45 pm

During my master's program I had five figures of student loan debt and was going to run out of money to pay the rent because I had forgone a summer job to finish my thesis. I had to scrounge up some freelance work to pay the bills, and that was "fake it till you make it" work way outside my wheelhouse.

UADM
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Re: When was the most stressful financial time in your life?

Post by UADM » Thu Apr 14, 2016 12:46 pm

stoptothink wrote:
UADM wrote:
stoptothink wrote:
UADM wrote:The interesting thing about this thread is that multiple people got cleaned out by divorce and then went ahead and did it again, while claiming to make better decisions. You could live with someone the rest of your life without the risk of being wiped out, but you chose the same risky path. I guess I just expected more bogleheads to learn from their mistakes. To be fair, one poster did say that he didn't do it again.
Do you refuse to drive ever again because you once got into an accident?

That is quite a depressing opinion you have there. I did learn from my mistakes. The 2nd time around I made it very clear that financial responsibility was one of the major attributes I was looking for in a spouse, I refused to get married without a prenup, and most importantly I didn't dismiss possible warning signs as I had the first time. If we are only talking dollars and cents, my wife has been the primary factor as to why I was able to more than recover financially in 6yrs; she's very financial responsible and makes nearly what I do.

A successful marriage is a wonderful thing, it's a shame that'll you'll never experience it.
Living together for the rest of your life is functionally exactly the same, with no risk. There is almost no actual benefit to marriage and you are giving away 50% of your life's savings in order to get that.

You can "make clear" whatever you want. Prenups are also broken all the time. You are taking a huge risk, with almost nothing to gain. You can choose to have the exact same thing without the risk. And dollars and cents, if you lived with her, the effect would be the same. The choice is yours of course, but the idea that people think they've learned from their mistakes and then put themselves into the same risk again(less with a prenup for you) is not exactly financially prudent.

As for picking a partner, there are ways to reduce risk, but people change over time. This is unavoidable. There is still massive risk in marrying vs simply living together for the rest of your life. It is a depressing opinion that you need a government financial contract to have a "wonderful thing" like a successful and happy relationship in order for the relationship to be successful and happy.
You're welcome to your opinion about the institution of marriage, but stating you were disappointed that so many Bogleheads didn't learn from their mistake is not a statement I expect to be up for long.
This is a financial thread, involving people who have been devastated by marriage, and then turned around and did it again. There is nothing wrong with that. However, to suggest that someone made a decision and got killed and then chose to do it again, when an alternative is risk free, shows that people didn't exactly learn their financial lesson.

If bogleheads isn't about learning from financial mistakes, then I don't know what it is about.

stoptothink
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Re: When was the most stressful financial time in your life?

Post by stoptothink » Thu Apr 14, 2016 12:55 pm

UADM wrote:
It has nothing to do with the institution of marriage. This is a financial thread, involving people who have been devastated by marriage, and then turned around and did it again. There is nothing wrong with that. However, to suggest that someone made a decision and got killed and then chose to do it again, when an alternative is risk free, shows that people didn't exactly learn their financial lesson.

If bogleheads isn't about learning from financial mistakes, then I don't know what it is about.
:oops: Financially, marrying my wife was extremely advantageous. My marriage allows me to get free healthcare (thanks to her plan, mine would be $400+/month), pay less for housing (what I was paying renting a single room was far more than half of our mortgage), I save on commuting costs as we were able to sell her car and carpool (when needed)...my savings rate has dramatically increased. So, what financial mistake did I make?

Nothing in this life is risk free, including investing. Not sure this is the proper place to go off on an anti-marriage rant, especially when marrying again was actually really good financially for many of us.

Chadnudj
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Re: When was the most stressful financial time in your life?

Post by Chadnudj » Thu Apr 14, 2016 1:07 pm

UADM wrote: This is a financial thread, involving people who have been devastated by marriage, and then turned around and did it again. There is nothing wrong with that. However, to suggest that someone made a decision and got killed and then chose to do it again, when an alternative is risk free, shows that people didn't exactly learn their financial lesson.

If bogleheads isn't about learning from financial mistakes, then I don't know what it is about.
Shacking up with a partner, absent being married, isn't without its own risks....nor is it necessarily less costly over the short or long-run than marriage (think: health insurance that covers spouses but not unmarried partners, Social Security benefits, laws that would require unmarried couples to obtain numerous legal agreements with the use of an attorney to be afforded the same basic rights as married couples, tax breaks for married couples versus unmarried couples in some instances, etc.)

Seems to me you're the one who is being pretty foolish to assume that getting remarried after a financially devastating divorce is "making the same financial mistake again," without considering how many financial benefits marriage affords.

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nopushover
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Re: When was the most stressful financial time in your life?

Post by nopushover » Thu Apr 14, 2016 1:10 pm

From 2014 until March of 2016. In 2014 I was asked to take a 28% pay cut. The industry I am in has been going through a big change with belt tightening all around and some layoffs. Being an over 50 woman and the sole breadwinner in the family (my husband was severely injured 2005 after being hit by a car while crossing the street; no kids), I accepted it. My job is pretty specialized and it would be hard to find another position that paid as much as even the reduced salary.

Despite the pay cut I am still decently paid – we have never lived extravagantly and luckily bought a house whose mortgage was affordable with just one spouse working. However in our two-income days we refinanced to a 15-year mortgage (increasing the monthly payment) and I had committed to share a mortgage with my cousin for our elderly grandparents’ downsized house. So after the pay cut, suddenly the 1.5 mortgages accounted for more than half my take-home pay. We cut back on a number of extraneous stuff like going out and on contributing to 529 for some nieces and nephews, but I still manage to max my 401K (and catch up) and our 2 IRAs. Still I have hated to live with less of a cushion as in the past – a couple of times of the year it has been dangerously low.

Had to get over the resentment over work situation (not helping anyone) and just last month, with a year and a half left for the mortgage on the house we live in, we sold some funds in a taxable account and paid off the mortgage. Now I can breathe again and am looking forward to saving more in our emergency fund. My husband has started to look for a job and I’ve started exploring side gig possibilities. Things are looking up again – if only the stock market would as well.

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Re: When was the most stressful financial time in your life?

Post by psystal » Thu Apr 14, 2016 1:26 pm

The year before my wife (then girlfriend) got a full time teaching job. I came out of school into the Great Recession, and she followed two years behind when prospects weren't much better. We lived together the year after she came out of college, and she worked as a substitute teacher during that time. She made almost nothing even when she was working, which was not often enough. I had a non-profit job and worked part-time for AmeriCorps. It wasn't just paycheck-to-paycheck, it was day-to-day.

Then winter came. Our landlord had mislead us about the utilities. We had a first-floor apartment in an old, former mansion, and he hadn't bothered to properly insulate the place. We had electric heat. Winter came on hard in December that year, our bill to keep the place at a balmy 66 (we both like it cooler) was over $600. We were in complete and total shock, and didn't have many options in our area at the time to move on short notice, which the landlord knew. He discounted the rent somewhat after we had a "friendly" chat, and thankfully it began to warm substantially in February. We moved when the lease was up.

The wife landed her dream teaching job the next year, and I moved on to greener pastures shortly thereafter. We were married the following year. I'm not sure exactly what would have qualified for LBYM during that first year together, but I'm guessing it would have involved a tent and improved wilderness survival skills. I figure if we could get through that period, we could get through anything else.

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Re: When was the most stressful financial time in your life?

Post by evoeco » Thu Apr 14, 2016 1:28 pm

firefly201270 wrote:I am also trying to now find a non-academic job now. Even though we both studied STEM subjects, it's been very, very hard. He studied math, and I studied science, but our research was very academic-oriented, so it has been a lot of work trying to re-train ourselves and learn new skills that employers find desirable (i.e. programming, machine learning, etc.).
I'm a longtime lurker who registered to reply to your post. I strongly recommend you look into https://versatilephd.com/, which you probably have access to via your postdoc institution. It's a spectacular source of very specific help transitioning away from the academic career track. It was vital to my spouse's shift to what has turned out to be a personally and financially rewarding non-academic job. I hope this doesn't violate forum rules!

I've been through a similar situation--both spouses in PhD programs, two less-than-full-time jobs, both uncertain of job prospects, and both uncomfortable with the two-body problem in academia. I agree that it's extreme stressful in financial and relationship terms, and I hope things work out for the best.

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