A Comeback Story

October 10, 2014

America loves an underdog.  I see it in sports all the time, and there are countless movies that end with the little guy triumphing over the big bad guy.As a society, we love to see someone prevailing against the odds.  I saw this article about companies that were left for dead but rebounded to find success again and it reminded me of how much we love a comeback tale in particular.

I was able to have a front row seat to a great comeback story over the last several years.  Nearly 3 years ago, I met an employee of one of our client companies and she was trying to decide whether to file bankruptcy or try to pay off a substantial credit card balance.  Her credit card balances were in the neighborhood of $40,000 and all had interest rates in the upper 20’s from a percentage standpoint.

Her friends and family were telling her to file bankruptcy. They said it was the easy option. She could have her balances wiped clean, walk away and get a fresh start.

Her only concern was a moral one. She felt that she got herself in trouble by overspending on “nonsense” and by being irresponsible and it was wrong of her to expect anyone to bail her out of a jam she created.  She wanted to do the hard work and make an effort to come back from the verge of bankruptcy to get herself into a position of financial security.

What she did from the first day we met until a few weeks ago when I saw her again was remarkable.  She went into a total “fiscal sanity” mode and wouldn’t spend a dime on anything that wasn’t absolutely necessary.  She moved into a very small apartment that was nowhere near as nice as what she was accustomed to, but the rent was half of what her prior rent was.  She picked up a part-time job to bolster her income.  She said “no” to girls’ weekends and beach weeks with friends.  She, formerly a tech junkie, is still using her iPhone 3.  She took drastic actions to bring her budget down substantially.  It was a complete lifestyle change.

Along the way, we would meet for “brag sessions” where she would tell me where her credit card balances were and we would look at which card to target next. She wanted to do it completely on her own so she opted to not file bankruptcy or work with a non-profit credit counseling service. Her determination was remarkable.

The last time I saw her, in the cafeteria of her employer a few weeks ago, she let me know she was signing up for another conversation about her finances and she had some good news to share. She’s a bit exuberant so she couldn’t wait until our scheduled conversation and told me that she was writing a check to pay off the last of her credit card balances within the next month. The reason she is scheduling the next conversation is to make some plans for what to do next.

She has had one single solitary goal for 3 years and now that she is reaching it, she wants to develop a new set of goals.  She is going to indulge in a girls’ weekend in NYC as a reward for being so focused, and she is going to upgrade her phone. Those were the rewards we talked about long ago and now that she has gotten to this point, she is going to reward herself and then get back to work on building for the future.

I can’t express how impressed I am with what she’s been able to accomplish given how she had managed her finances up until the day we talked about her desire to change her financial life. She has come back from a pretty bleak place. Yes, bankruptcy would have wiped out her debt and gotten her to a clean slate much more quickly, but the lesson that she has learned (and one that I hope to impart to my kids and at times myself) is that through determination, hard work, a few sacrifices, consistent effort, good habits and a smile every step of the way, there is not much that is happening in one’s financial life that can’t be overcome.