(Here we are, Part 3 of “The Plan.” By now you’ve no doubt digested and scrutinized the first two parts, “Fear” and “Debt.” After this installment, which I call “ Savings,” next up will be “Income” and “Love.” Then I’ll meander into the day-to-day mechanics of implementation. It’s when you, the reader, will witness either a really grisly car accident or the making of a super hero. Or, more than likely, something very much in between.)

Savings

Phx HouseSo I have a couple hundred dollars in savings and an Individual Retirement Account (IRA) that will do me no good until I’m some ungodly old age. I have a few thousand dollars of available credit on a high-interest credit card and no chance of getting approved for more credit in the foreseeable future. I, like millions of other Americans, live paycheck-to-paycheck, hoping no calamity befalls me that requires anything more than a few hundred bucks to resolve.

And we all know unexpected crap hits the fan at will. I have a friend who recently had a sudden $50,000 dental issue for which she had no insurance. I have another friend who’s lost countless days at work due to an injury requiring two different surgeries. I have a third friend who quit her job to move back east for the better part of a year to put both her parents into a nursing home, pack up the family house, and put it on the market — all the while bringing in no income whatsoever, and having no savings to fall back on.

I know I’m not immune to that kind of gut punch. And I’m woefully unprepared (just as my friends were). I feel pretty good about the direction my life is headed, but it’s still fragile. One mishap could derail the entire thing.

My lack of savings has also taken a toll on my business. I make most of my income owning and managing rental properties, many of which are facing deferred maintenance because I have no ability to pay for improvements.

One of those properties happens to be a house I lived in for 10 years. It’s a 1928 custom English Tudor in one of the original neighborhoods of Phoenix. It’s quaint and charming and feels more like a coveted work of art than real estate. So I’ve never wanted to part with it.

Thanks to a rebounding real estate market, I once again have some equity in it. (By the way, that’s a painting of my house above, done by my dear friend Liz O’Brien.) I bought it for $130,000, and at the peak of the market it was worth $575,000. At the bottom of the crash, the value plummeted to $220,000 (at which point I was upside down) and now it’s back around $350,000.

So if I sell it, I could:

1) Get completely out of debt
2) Create an operating budget for my business
3) Buy a new car for cash (since I can’t qualify for a car loan) to replace the car I currently have which falls apart a little more each day (the driver’s-side door handle broke off in my hand last week).

I’ve recently concluded that for me to make enough money to accomplish all three of those things, and at the same time keep up with all my other bills, is beyond my capacity.

I’ve also been holding on to that house in case I ever move back to Phoenix. Ironically, my ex and I moved out it in 2004 because we thought we needed more space. It’s less than 1,300 square feet, has a guesthouse, and a pretty big yard. And, truth be told, it seems a bit excessive to me now, in my new hyperbolic state of minimalism.

Plus, I can’t leave Los Angeles. My life just keeps getting more interesting (not always in good ways, but I’m never complacent). And as much as I love home (Phoenix), I just can’t go back. The world is a big place. I’d sooner explore another hemisphere or other opportunities before going back “home.” I did “home” already.

So this time it’s really good-bye. It will go on the market in January. As sad as that day will be, when I sign the document turning it over to someone else, I won’t be turning over one thing: some of the best memories of my life. So many family functions. So many parties. So many neighborhood events. Ah, the neighborhood. There was a time when everyone on that street, I mean everyone, was friends or, at the very least, “friendly.” Two of them are still two of my best friends in the world.

It was a feeling of “community” I’ve never had before or since. And, not to be pessimistic or negative, but I’ll be shocked if I ever experience anything close to that again. Perhaps it was just a different world back then.

In many ways it feels like the “house I grew up in,” even though I was in my 30s at the time. Living in that house on that street in that time had an impact on who I am today.

And now I need that house to do one more thing for me: provide me with some well-deserved, desperately-needed, financial breathing room.

(To be continued…)
JMcT

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Comments
  1. Carolyn Quinlan says:

    Oh how I remember all the good times in that house! They will be with me always.

  2. christa says:

    Proud of you!

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