The first #FinHealthMatters Day: Deeply personal stories about financial health in America
In case you missed it, June 29 was the first-ever #FinHealthMatters Day. You might be wondering what that’s all about, maybe even why you should care. In a nutshell, it’s this: 57% of Americans — approximately 138 million adults — are struggling financially.
If that doesn’t scare you, it should.
The struggling majority aren’t who you think: While it’s tempting to think it’s all about income, it’s not, asserted CFSI’s RachelSchneider in The Development Set. There’s plenty of proof that the struggling majority aren’t just the un- or underbanked. They also count among their ranks plenty of your neighbors (and maybe even you) who appear to have it all, while hiding a secret shame that equates to not being able to come up with $400 in an emergency. The Atlantic story, “The Secret Shame of Middle Class Americans,” written by journalist Neal Gabler, resonated so strongly earlier this summer that there was a poignant followup feature, “Your Stories of Financial Struggle.”
From those stories:
“I had hoped to find my way to something resembling a career before my kids were old enough to notice that their father was a failure, but it’s looking more and more like I won’t meet that deadline.”
At CFSI, we’ve been talking about Financial Health with our network for a long time. But this year, we turned the conversation over to personal finance bloggers and asked them to write essays about what financial health means to them.
What surprised us? The sheer volume of stories. The highly personal nature of many of them. The quality. It’s not lost on us that while personal finance bloggers may have different voices, come from different backgrounds, and different ways of achieving their goals — they’re all essentially writing about the pursuit of something we know Americans need to work on: Financial health.
Here’s a peek at the work of this year’s winners:
Debt Free Divas: “I left undergrad with $13,000 in student loan debt. During the 90s, I paid the regular payment without much heartburn. However, when my career interest changed from corporate America to nonprofit (along with my income), that student loan payment became a larger issue. By then, I was married. We dove into a mortgage. Actually, we never met a financing opportunity that we couldn’t refuse. We bought a timeshare. Leased automobiles. Financed cars. Purchased a laundromat with a very expensive price tag. My penchant for travel only increased now that I had a built-in travel buddy. Most of that ended up on credit cards. My idea of financial health during this time was largely tied to maintaining a high credit score. According to FICO, we were rock stars. In reality, we were just deeply in debt.”
Betsy Mikel: “The average cost of attending Northwestern is now $68,060 a year. Had I attended, I’d be chewing that student loan debt for the rest of my life. Instead, I went to a state university with tuition a fraction of the cost. When the financial crisis hit shortly after I graduated in ’08, you better believe I was thankful I hadn’t binged on an education I couldn’t realistically afford.”
Saidia Financial: “In 2011, one early March morning, my dad suddenly passed away at home when an undetected heart condition caused his heart to stop. In that moment, everything changed. We lost our family’s leader and my mom lost her husband of nearly 30 years, whom she relied on for many things. In addition, there were still kids and grandkids living at home to provide for and bills to pay. We suddenly had to figure out how to plan an affordable funeral with our limited combined savings, and create a plan to make sure my mom and the younger kids could handle the household finances with a new, lower income budget. I always assumed that we were financially healthy because we never went hungry, we had all our basic needs met, and God always provided. But I’ve since learned that being financially healthy doesn’t only mean having money for the here and now, but also careful financial planning for a time when you will NOT be here.”
Amanda Lettmann: “What financial health means to me is being aware, educated, and prepared. Unfortunately many Americans are not in the same position of preparedness that I was many years ago. Only 35% of Americans have disability insurance, yet income loss from disabilities account for nearly 50% of today’s mortgage foreclosures. There are nearly 100 million American workers today that don’t have disability insurance and 72% of them don’t have enough savings to cover even short-term emergencies, let alone a longer period of disability. I like to call disability insurance “income protection insurance,” because the loss of income all too often can trigger the snowball effect of financial devastation that millions and millions of Americans have experienced.”
Six Figures Under: “On the outside we may have looked financially healthy. We owned a modest home. We avoided extravagant spending. We drove a normal used car. We looked fine, but inside we felt sick. Like many physical health issues, not all financial health problems are obvious….We owed over $130,000.”
Cash Money Life: “A lack of money doesn’t prevent me from spending time with friends or family. And I don’t play the “keeping up with the Jones’s” game. Money doesn’t define me.”
I Pick up Pennies: “Our income was less than $40,000 a year and we faced a constant onslaught of medical expenses. But what could we do? We lived on as little as possible and threw every spare cent at debt. Sometimes the debt would increase as new medical expenses hit, like when Tim needed a $12,000 medical procedure. We were often exhausted and frustrated, but we didn’t let ourselves become disheartened. Instead, we just kept plugging away.”
Principles of Increase: “As an impressionable teenager and twenty-something, I adopted this same definition of wealth with pretty disastrous results: I nearly drowned in debt trying to chase the American Dream. Starting a family was my wakeup call. I realized that we were soon becoming part of the 57% of Americans that struggle financially*. As a newlywed and new mom, I had to make a quick decision: feign wealth with credit cards and debt or make a sincere attempt to understand how money worked. This would have to be “for reals” with the goal of building our family’s net worth for generations to come. As someone who worshipped nice clothes, pedicures and sushi outings, this was one of the hardest decisions I ever made. I chose financial wholeness for myself and my great-great- great- grandchildren.”
His and Her Money: “I ended up in over 30k of debt with zero savings! I incurred so many overdraft fees in my bank account that it led me to take out payday loans to pay other payday loans. It was very common to find payday loan facilities on every corner around the military base. It was as if they intentionally sought us out because they knew that our paychecks were guaranteed to come in on the 15th and 30th of every month. The cycle never ended.”
In the meantime, we’ve got to ask: What does financial health mean to you?
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MetLife Foundation is a major sponsor of CFSI’s ongoing consumer financial health work.