Rodger Ramjet, Life Was Good:

Well last week we had an inspirational story from someone who wanted to remain anonymous. This is fine with us and we can understand people’s point of view. It can be embarrassing to admit that your home budget is a bit out of whack. Co-workers and friends sometimes aren’t the nicest of people.

What we can say is it is a male between 35 and 40. He is married with 2 kids. For the purpose of this story we will call him Rodger Ramjet.

OK Rodger tell us your background?
Well three years ago I was in a high paying job. Life was good. We were paying the bills and living a good life. However I never worried about the home budget. While we had a lot of stuff (plasma TV, motorbike and a very nice second hand BMW). I never thought for two minutes about all the debt we were taking on to purchase it.

Our motorbike and BMW had car loans on them. And most of our other stuff was on credit cards.

My work for one reason or another let me go. No problem I thought I will get a job in the same industry at a simliar pay. Then we can go on living the same way.

So how long did it take you get the job?
11 months. It took nealy a year. And in that time all our money ran out and my credit card companies, car loan companies and our home loan were all at us about paying them back. By month 7 we started missing payments on nearly all our debt obligations. It was like a giant cold bucket of water had been tipped over us. It was truly a wakeup call.

How did you handle this?
Well by month four, I took up a job in real estate. This was nearly 50% below my old salary. However it helped. We sold the motorbike. But by month 9 this was not enough. We had to sell the BMW and as you say in your book downgrade our car. Plus sell some of my wife’s old jewellery. We made it through until I got a job at my old salary. But just by the skin of our teeth.

I made a promise to myself that I would never be in that situation again.

How have you kept that promise to yourself?
Well I have read a number of budget books (yours included). Plus we have done the hard things that we knew we needed to do. We have no credit cards any more. We have stopped buying cars on car loans. We even moved house from our extremely nice house in a great neighbourhood to a smaller house further out from the city. We also keep a budget and stick by it.

Honestly we got real with ourselves.

Tell me how it makes you feel when you look back on your pre-budget days?
I just think of all the money we wasted. Once we purchased a couch for 4500 plus dollars. This did not include the cushions that cost over $95 each. This is just totally too much for something to sit on. There were a lot of couches for $1000. However we liked brand name items.

My partner and I have wasted a lot of money just to stroke our egos. The funny thing is I still see a huge number of people living this way. I’m just really glad that we didn’t go another 5 or 10 years doing this.

Do you talk about money issues with your kids?
Oh yes. We don’t want them to make the same mistakes. They earn pocket money. We get them to write out a budget for each dollar they intend to spend. Plus we also encourage them to put some money away each week for a rainy day. We always tell them not to get credit cards and always pay for things with cash.

Our youngest one is very good. However the older one still needs to be kept on track now and again.

Thanks very much Rodger. We wish you the best of luck in the future.