I Spent My $66,000 Inheritance on Basically Nothing

When I was 22, I was a year out of college and living at home. I had no money, and I spent all of my time reading blogs and applying for jobs that never got back to me. But then I received an unexpected major inheritance from my step-grandfather.

I received a lump sum of $66,000 after  taxes—more money than I could comprehend, really. My dad immediately took me to the bank and helped me open a CD, a deposit account with a high interest rate, stressing that the money would grow, and then one day I could use it on a down payment on a house. That sounded nice, but also very far away. Buying houses was for old people! I was young, and it had been a hard year—didn’t I deserve something nice now? I put $61,000 into the CD, and $5,000 in my checking account.

I was cautious going into spending the money—terrified of ruining this opportunity. My first major purchase was a fancy DSLR, a Nikon D80, a solid camera that all my favorite lifestyle bloggers seemed to love. I got it off of Amazon with a kit lens for a little over $1,000. I had an interest in photography; it seemed like a practical purchase, necessary, even.

I remember asking my boyfriend if I had made the right decision. That was the single biggest purchase I had ever made in my life, and it seemed like something worth debating. But he insisted that if I wanted to take great photos, nothing would be a greater incentive than an amazing camera. I still remember the day I got it. I felt professional, rich, and responsible. It seemed like a well-reasoned purchase, and I vowed to continue to make practical decisions about what I would buy. If I wanted to be a photographer, a good camera was the perfect starting point. Naturally, all my purchasing decisions would follow as such. Right? 

Buying the camera had made me nervous, but I soon found the money easy to spend. With $61,000 in the bank, it seemed like I had a nearly limitless supply. I started with small things: A pretty porcelain vase here, a Thread Social skirt there. Those lifestyle and fashion and design blogs I loved—the beautiful things posted on the sites were suddenly attainable to me. I bought $200 ban.do flowery headbands, ridiculously ruffly silk collar necklaces, even hideous Jeremy Scott leggings with gas pumps on them. If I was even slightly interested in it, to my house it came.

I always intended to return the things I didn’t love, but I rarely returned anything. I’d look at my bank account and it just seemed like I had a never-ending flow of money that rendered returns irrelevant. I even started my own fashion blog, convinced that if I owned cute, quirky things, I would somehow develop the interesting, artistic life that I wanted. I overlooked the fact that I was living in a boring cookie-cutter house in the ‘burbs, and spending my days doing nothing but perusing the Internet and shopping. A highlight of that time was when Tavi Gevinson commented on my blog, complimenting one of my purchases. That meant something to me.

That initial $5,000 was gone in a month, and then I started tapping into the reserves. I was allowed one withdrawal every three months from the CD, but I started taking out $5,000 every few weeks, losing any interest I’d accrued and blowing through my money. I felt so guilty talking to the guy at the bank that I kept making up excuses like, “Oh, I’ve had a lot of medical problems recently,” or “My dog needs surgery.” I didn’t have a dog.

I became obsessive about shopping, thinking that buying something new would make me feel better about myself and my life. I would see something, and freak out over needing to own it. I had no self control in my life when it came to spending, which I did frivolously and with abandon.

I did have big dreams and aspirations. The money meant opportunity to me, if only I could make a decision. I wanted to move across the country, I wanted a nosejob (I know this sounds shallow, but it is what it is; I’d dreamed about it since I was 12), I wanted to completely change my life and surroundings. But I couldn’t commit to anything. I may have had grown-up clothes, but I was really just a scared little girl. Spending a few hundred dollars at a time on tangible things seemed more rational than spending thousands of dollars on one big idea that could turn out to be a giant mistake.

But it wasn’t a continuous flow of funds. After two years, I was down to a few thousand bucks. And then a few hundred. And then it was gone. Now, four years on, it’s more than gone. I have a credit card with a $7,000 balance, and I had to borrow money from my dad to pay my taxes (I’ve never told him point blank that the money is gone, but when I call him up to borrow $100, he must know).

I have nothing to show for my windfall. I don’t even have my little DSLR anymore; I sold it recently to pay for car repairs.

I probably think about the money at least once a week, more when I’m stressed. Sometimes I regret not making a big change in my life; sometimes I regret not getting that nosejob (I still think about it); and sometimes I regret spending thousands of dollars on clothes before I’d come into my sense of style (now impeccable, I’d say, but which does not include gaspump leggings and ruffly collars).

Mostly, I wish I had tried something risky while I had a huge cushion. I’m thinking about moving to Austin now, but it’s tricky; I’ll need a job before I get there to make it work, and even then I’ll struggle to cover moving expenses and new rental costs. If I had the money now, I’m sure I’d still buy things—it’s my nature—but I’d also take advantage of that safety net. I’d make a move. I still will, it just won’t be as easy as it could have been.

 

Allison Cintins is a public health researcher in Richmond, Va. She takes issue with Biggie’s “Mo Money Mo Problems.”

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86 Comments / Post A Comment

hershmire (#695)

Easy come, easy go.

Also, we need more stuff

“convinced that if I owned cute, quirky things, I would somehow develop the interesting, artistic life that I wanted.” I can completely relate to this feeling. I noticed, “coincidentally,” that when I started to finally pursue the creative stuff I wanted to do, I didn’t feel the need to buy so many quirky, creative-type clothes. Thanks for writing this.

Fig. 1 (#632)

@Kate Abbott@twitter Yes, it’s like how when I started to go to the gym seriously, suddenly I didn’t need to go out and find the absolute best workout clothes.

nonvolleyball (#305)

@Fig. 1 I feel like this sort of relates to the willpower/ego-depletion thing that was posted here yesterday, no? the more fulfilled you feel in your “real life,” the less you rationalize self-destructive “rewards” you neither don’t really want, or need.

Fig. 1 (#632)

@nonvolleyball I was all over that ego-depletion story, let me tell you. Although now I just really want chocolate-chip cookies.

nonvolleyball (#305)

@Fig. 1 are you sure you don’t just want a radish? after all, nobody likes you. (seriously, that story confirmed everything I’ve ever anecdotally believed about internal vs. external sources of happiness.)

Fig. 1 (#632)

I know somebody who didn’t work for two years and spent over 30k in savings. Now, she wishes she’d bought a house with it, since the market has gone nuts here since then (and shows no sign of slowing in the near future.) It’s not the absolute worst feeling, spending all that money with nothing to show, but it’s definitely a persistent one.

myrna.minkoff (#272)

For what it’s worth, I think your nose is adorable. I once too often dreamed of getting a nose job (my nose is fairly unique) but now many people say it’s one of their favorite physical traits of mine. Own it!

Thank you, Myrna. This was really hard to write, but I am being brutally honest here.

nonvolleyball (#305)

@allison cintins I’ll grant that the gaspump leggings & giant collar-necklace were probably mistakes, but that vase & that skirt are adorable! for what it’s worth.

also, I think the just-out-of-college/waiting-for-my-life-to-begin era is when everyone’s most vulnerable to irresponsible spending. I didn’t have a $60k inheritance to blow, but I definitely spent my lunch breaks shopping for the new professional wardrobe I “needed” (& also, legitimately needed since my poor impulse control/constant restaurant-eating was causing me to outgrow my older clothes).

but I feel like making these mistakes–& then learning from them–ultimately teaches you responsibility in an indelible way. my credit-card debt is gone, but my mindset toward shopping is forever changed. now, I have to talk myself INTO buying something I CAN afford…which is far healthier in the long run. you’ll get there too, I’m sure.

che (#714)

@allison cintins I think learning to manage money and use credit are a right of passage these days (WHY didn’t you teach me better, parents? / WHY didn’t I listen?). Some of us are lucky and only have a few thousand dollar credit limit to fuck up with, but I’m sure if I’d had $60K to blow through at 22, I would not have managed it well, either. At least we learn from it? (I’m still in the learning process, but doing better.)

candybeans (#68)

oof, thanks for sharing. reading this gave me heart palpitations, though; i could feel myself sinking lower and lower in my seat as the money disappeared.
Money is tough, dude.

NoReally (#45)

That felt a lot like your basic addiction memoir.

melis (#42)

@NoReally Not exactly. It was a lot shorter, for one thing.

sox (#246)

@melis And contained neither hookers nor hotel rooms nor copious amounts of blood.

throwawaysies (#696)

Oof this hit hard. I had $200,000 given to me when I turned 18. Yes, I spent a lot of it on getting a college degree, but there was also a $4,000 computer (mainly so I could do video editing which I never did) and expensive weed and just the right type of Volvo station wagon and a couple of trips bumming and drinking around Europe. Stupid shit. By the time I was two years out of school, the money was gone baby gone.

Now that I’m nearing 30, the idea that I could have used my good grades and great test scores to get a scholarship to a good state school, saved that money, and maybe not had a fun story to tell about Prague haunts me. Of course, trying to get any sort of sympathy for this is akin to someone complaining how because they’re so pretty nobody takes them seriously.

When the next chunk of change comes my way (my grandparents and my parents will pass along some as well) it’ll be socked away. And if I have stuff to pass along to my kids, it’s gonna be under a whole bunch of locks and keys until they’re way, way older than 18, with restrictions on how it’s spent.

Really do think giving a typical middle-class kid (or any kid really) a bunch of cash is about the same as lighting it on fire. A few — maybe 20 percent? — will handle it responsibly. The rest will blow it on various forms of short-term gratification.

@throwawaysies Totally agreed. Though I still feel terribly guilty.

throwawaysies (#696)

@allison cintins Oh, me too, all the time. I really admire you being willing to talk about it openly. For me, I mean, people knew in college I had some money from my family, but now it’s not something I talk about, at all. If anything, I can remember with distinct shame about how I was shitty to someone who revealed their parents had bought them a BMW, all in some weird reactionary hope that people would think I was salt-of-the-earth blue collar. Money makes us fucking weird!

Since college, I’ve been able to support myself, have a decent job, live a pretty pared down and non-extravagant lifestyle (putting down $65 for a J. Crew shirt recently was ten minute back-and-forth argument in my head). But the knowledge that I was frivolous and wasteful is always going to be there. Like if you were an alcoholic, you know you wouldn’t keep a bottle of vodka in the freezer. If I ever come into money again, it goes far, far away from me.

throwawaysies (#696)

@allison cintins Ha, and obviously this has sparked some wellspring in me because I just want to keep talking about it! The other part of it that I think about is it’s almost cruel to give a kid that much money, but ONLY that much money, you know?

I’ve been around enough people from actual, no-shit rich families where the kind of casual spending I’m beating myself up over doesn’t matter. But you give a kid who shopped at Mervyn’s a sudden influx of cash, and it allows them a brief moment of understanding what never worrying about money would be like. And THAT is an awful thing to know, once you go back to worrying about money again.

@throwawaysies EXACTLY! I went from constantly worrying about money (I had so much guilt borrowing money from my parents that I transferred from University of Florida to UVA) to not having a care in the world. I just went overboard with it. Lesson learned, I suppose!

throwawaysies (#696)

@allison cintins Onward and upward.

Great piece, and thanks for writing it and good luck with a move to Austin!

frigwiggin (#702)

@throwawaysies I inherited a chunk of change when my great-uncle died, and I did end up using some (not sure how much, I never had direct access to it and it is currently all tied up in stocks and I still don’t have much to do with it at 23) for college–I think back now and wonder about scholarships, but ultimately don’t feel too bad about them? Mostly because I’m feeling too bad about the imaginary person who could have used that scholarship more that I would potentially be taking it away from. Which is also silly, but there you go. Right now I have no idea how much money is left, I basically function as if it’s not there, which I think is not a bad way of doing things since I’m supporting myself and can save it for a rainy day or whatever.

My brother, on the other hand, used part of his inheritance for college until he dropped out, lived off it (and I suspect bought a boatload of drugs), and I think it’s pretty much gone now.

frigwiggin (#702)

@frigwiggin I didn’t mean to sound like “heyyyy look what I did I am so good at this!”, just that I have felt that same feeling about scholarships, but I try to give myself a break on it. I too wibble about expensive clothing and belongings (I mostly thrift-shop), and generally try to live cheaply so someday, if I need it, it will still be there.

@throwawaysies Thank you on both accounts!

Megano! (#124)

I kind of feel like this sometimes too. But it did pay for my university, and to ride out two years of unemployment, but if I didn’t have it I also wouldn’t have been able to do my program and hopefully actually get into the career I want.

yankeepeach (#276)

Coming into a pile of money when you previously had no money is tough. I used mine to go to grad school and survive unemployment due to the epic bad timiming of my graduation coinciding with the market crash. Do I wish I had done something else with the money? All the time. Do I have any idea what else I could have done? Nope. Do I second-guess myself on this every single day? You bet.

@yankeepeach Same here. I expected everyone to pile on me for being so wildly irresponsible, but it seems everyone kind of has this similar sentiment.

yankeepeach (#276)

@allison cintins Honestly, you were very brave and you did a good thing. I think this is a secret shame for a lot of people (Having too much money? I mean really.) I can’t tell you how much better I feel knowing I’m not the only one who’s been through this and has these feelings. Thx.

che (#714)

@yankeepeach One of my FB friends posted an article a few months ago about “spending like a poor person,” and I have no idea where it was, but all I could think was, YES! Basically it said that when you’ve always been poor, you don’t save because there’s never enough TO save, so it seems more logical to buy what you need / treat yourself occasionally. I make only slightly above minimum wage (I’m starting grad school in the fall, so hopefully this is a temporary thing), and I need to be saving for a new car, but it just feels so hopeless to save thousands of dollars when you make $8.75 an hour. We were also fairly poor while I was growing up, and while I think my parents are kind-of better at managing money now, they definitely didn’t have great spending habits when I was young, so I’m having to learn it on my own.

@che Was it from Cracked? They had a good article recently about that sort of thing- the unhelpful habits you can get from growing up poor.

heather (#701)

Ohh, jeez. I inherited a similar amount when my dad passed when I was 24. The money was gone within about two years, and I was even left with 5-figure credit card debt. And I had nothing but a MacBook,piles of cheap clothes, and cancelled rent checks to show for it. Until I got the inheritance, I’d never had more than a few hundred dollars to my name, and I had no clue how to manage that kind of money. (I even left it all in my checking account! All of it!) It’s been eight years and I’ve almost stopped beating myself up for being so irresponsible. So, you are not alone. But the good news is that you can grown up and take control of your finances and learn from your mistakes. Best of luck to you with that!

This hits close to home – I earned about $20k over two summer internships and blew through it again in about as much time on pretty much nothing: a DVD set here, a dress there, newspaper/magazine subscriptions, purses, movie tickets, nail polish, snacks.

I was very depressed and spending my money made me feel both better and worse – better because I was in the too-slow process of flunking out of a degree program I wouldn’t admit I hated at a university I wouldn’t admit I hated, worse because I’d also hated those (related to the major I hated) internships and the money seemed like the only worthwhile thing I’d gotten out of those two miserable, lonely (I’d had to move to a new state for the job) summers.

Now things are better – I’m closer to doing what I want, and thanks mainly to my parents’ intervention and support I’ve managed to turn things around without adding credit card debt to my student loan debt – but I often think about that $20,000 and how quickly it slipped away on so many cheap small things I can’t even remember. I didn’t even HAVE to take out those student loans! I could’ve paid my tuition balance with that money, and yet for some reason I didn’t.

I do remember my first purchase, though – it was a $2700 Genuine Buddy 50cc scooter in seafoam green. I don’t regret that for a moment.

Wow, this makes me feel so many things. On one hand, I want to be pissed, thinking about how much an inheritance like that would help this 21-year-old, full time student working tree jobs, and I’d like to believe I’d be so much more responsilbe than that. On the other hand, I can totally relate to wanting to have nice things in order to make myself feel better.

It also makes me feel a tad bit less guilty about the irresponsilbe money decissions I’ve made myself. Recently, my mom got a really great job overseas and has started helping me out with my school bills. In the last 4 months she’s given me over $1,000 (more than half of what I owe my super cheap state school) and I’ve only paid about $145 on my tuition bill. The rest I spent on rent/other bills/shit I don’t need. Now I’m stuck because I can’t register for fall classes until I pay up, and I have too much pride to tell her :/ Live and learn, right?

DON (#706)

Allison, You’ve put me through the 5 stages of grief with this. Super brave of you. My take away: FUCK MONEY. (Maybe I haven’t made it through all 5 stages yet…)

@DON Thank you! I agree.

Allison, I was wondering how much of the problem came from the sort of normalizing effect from fashion blogs’ constant emphasis on the new? Some of the more commercial blogs never repeat the clothes, and it seems like (this sounds parental or something) a bad environment.

Thanks for writing this–you are totally brave for it!

@l’esprit de l’escalier I think that’s a totally legitimate point. I was reading Fashion Toast and Blushing Ambition and they always had like, a bajillion new things, and I just sort of…thought that’s what I needed to be doing. Thanks for the support!

Wow, I’m so glad I read this today. I didn’t inherit any money, but I definitely relate to the pattern of spending. I used to stress out about having maybe $500 of debt, then for some reason the SCREW IT switch flipped on and I accumulated a 5-figure credit card debt a little less than two years. I’m in my very late twenties now and have just started a program to pay off the debt in five years. What did I buy with the cards? Dinners, mini vacations, musical equipment, and yes, clothes. I think by age 28, I was fed up with recycling the black-top-and-tattered-pants uniform I had since college, and buying every interesting thing that suited my style become my project. I also stopped buying drugstore make up (like a big girl!). Once I got into the debt payment plan (which closes the card accounts), I sobered up a bit and the urge to shop faded. Of course, now that I have a little tax refund money in the bank, the temptations are starting up a little, but I know that I can’t buy anything unless I earn the money first. (Right…?)

Problem is, I don’t know if I fully regret all of the purchasing I did. I would be kidding myself if I didn’t admit one of the reasons I don’t feel so compelled to shop now is that I’m kind of stocked up on quality goods (for a little while). It seems like I was buying stuff to compensate for not buying anything ever, and each day when I brush on a good foundation or pull together a flattering-yet-creative outfit, I feel very conflicted because I’m happier having made those purchases despite the massive debt burden I now deal with. If this is all driven by vanity and ego, then why do I feel more creative and…I dunno, self-actualized? Like the author and those who’ve commented before me, dealing with the negative fallout is instrumental to learning how to be responsible with money. But, if you genuinely enjoy things like art, style, or good food, how do do reconcile all this? Is living within one’s means really an all or nothing situation?

Holy typos… English is my first language, I promise.

throwawaysies (#696)

@frigwiggin Yeah no, I don’t regret spending the money on college, not really. It’s a good point that I DID have the money for college, and a scholarship would have been taking money away from someone who DIDN’T.

Unlike you, I had very direct access to my cash throughout school. I’d walk into the registrar and write a check for tuition, and then swing by the ATM to get beer money. My regret is that I blew money on stuff like travelling around Europe, or smoking pot all day erryday.

I guess I’m saying I related to the experience of watching at what from the outside sounds like a shit-ton of money — $66,000! $200,000! — evaporate. Now that I’m about to do stuff like get married, find a house, maybe pop out a kid or two, that same amount of money could have been used in much smarter ways.

Lemonnier (#184)

I had an ex who was epically bad with money. He and his ex-wife sold their house at a $500,000 profit at the height of the housing bubble, and the money was gone within three years (save for the down payment they put on their subsequent house). A year after that disappeared, he inherited about $100,000, and that sum was gone within one year. And most of it was spent on restaurant meals, clothing, standing rounds of drinks for friends and acquaintances, kooky ebay purchases, and plane tickets.

He died seven months after the inheritance ran out, and his total assets at the time were so small — really just personal effects like books, household items and clothing — that his family didn’t even have to open a succession.

Y’all have got to be kidding with all this pat-on-the-back breed of comments. I sweat over every single purchase over $30. Blowing that first $5000 in a fit of exuberance? Fine. Blowing the rest of it? Absolutely unacceptably disgustingly 1%. How embarrassing that we write off irresponsible spending like this as some general right of the young, rather than a total and irredeemable waste.

gus (#711)

@Natasha Simons@twitter I made an account to agree with you, fellow sane reader. Interesting article with infuriating comments. In what world is a $20,000+ windfall considered “tough”? I can understand the unfortunate circumstances that commonly accompany an inheritance, but wasting that much cash is mind-boggling.

chic noir (#713)

@ gus haha me too. I just had to post something on this post. I really love this blog. It’s like finance for hipsters and I mean that in a good way, no irony.

Jobeans (#227)

@Natasha Simons@twitter For what it’s worth, I feel similarly irresponsible (though not AS bad, and I still have a nice sum) as the author, and the money I have came from a lawsuit my family filed on my behalf when I was a child due to medical malpractice. My parents were immigrants and always managed to take good care of me while being poor and eventually lower middle class. We didn’t have access to that money, aside from educational purchases such as a piano for my music lessons, until I turned 18.

My family hardly being 1%, I can’t say that it’s been any easier for me to figure out how to deal with money appropriately. Also, 1%ers wouldn’t be regretting their spending because they would probably still have a fuckton more. So yeah, no need for the serious judgementalness.

@Jobeans My initial reaction was like Natasha’s, but then I realized that a lot of “average”, 99%-er people will come into unexpected money at least once, and it’s important for people to know what NOT to do if they get a windfall. We’ve all heard the stories of the unfortunate folks who win the lottery and end up right back where they started.

I didn’t see Allison looking for sympathy, and since she says she regrets it, I decided to leave my initial reaction behind. Do I wish I had $66,000 so I could improve my life and the world? Hell yeah! And I’m already responsible with my money and have specific ideas about how I would use more, so that helps. But she might have said the same thing before it actually happened to her. So take it for what it’s worth, bourgie or not.

carro (#718)

@whateverlolawants I think the original article is a good (if extreme) lesson to hear – what seems incredibly weird are all the comments indicating that this chain of events is somehow expected/ok, just unfortunate. A 22-year old college graduate is not a child! My distaste also probably has to do with current events – my fiance amassed huge amounts of credit card debt in the same after-college period, and though I knew it existed I just recently figured out just how bad the situation is. Ugh.

Megano! (#124)

@carro That might not be true: http://www.dailymail.co.uk/news/article-2134813/Think-youre-grown-Remarkable-new-research-suggests-young-people-dont-true-adults-theyre-24.html
Also to clarify: I have not spent all of my inheritance, but I haven’t (for many reasons, including health problems) been able to save it either.

scooter (#5,950)

@Natasha Simons@twitter I commend Allison for being honest. But damn, blowing through all that money is ridiculous. I wonder how much hard work it took for her grandfather to work for that. I’m amazed by the”oh, it’s ok comments” People bitch about being broke and when an obscene amount is given to them they blow it and look for sympathy. I wouldn’t give anyone under the age of 35 any large amounts of cash…

chic noir (#713)

I’ve been reading this blog for a few weeks. Love it Mike, Logan and the rest of you guys but I really need to chime in.

Blowing thru so much money is not something to be treated lightly. Money= freedom.

I don’t know, this post and comments have me really thinking about why some people are rich and why most people struggle. Sure it a huge part of it is opportunities, connections and just plain luck but even when the less to do are given a windfall of cash, how often do they use that money responsibly?

I would like to think if I inherited 60,000, I would give myself 6-8K to spend anyway I want(Celine bag, 2-3 pairs of miu miu flats, Paris, Italy and Sweden here I come) but the rest would be saved for truly cats, dogs, and cows rainy day.

Jobeans (#227)

Allison, I relate to this a good bit and to be honest, it scares me. Right down to the shame of seeing your banker/investment broker when you withdraw money. DISCLAIMER: I am basically about to tell you my life story.

I have continuously told myself “this is the last time” and “this $5,000 is my safety net,” but I really just don’t even know HOW to say no to myself. I am a college graduate (it’s been a year already, sheeet), so despite my scholarship I still spent a good bit of money on tuition/housing/food/FUNSTUFFORME. After I graduated I lived with my mom for a while back home (in nyc, thankfully) and as of the past 5 months my boyfriend and I have been living together and paying rent for our wonderful apartment in Brooklyn. The problem is that i work part time in retail and I can’t even afford the cost of living. I procrastinate applying to better jobs (jobs that require a college degree! jobs where I COULD SIT) because I often get self-deprecating and think that there are just so many more qualified people out there. It’s not a good place to be, and it only recently dawned on me how this NEEDS TO CHANGE NOW, but I feel a bit paralyzed by fear and having to actually be a responsible adult now. To be honest, despite what other people will say, having an inheritance/savings/whathaveyou is, I really think, a blessing and a curse if you are just learning how to be an adult. I am obviously thankful for it but I also know that it prevents me from taking myself seriously sometimes because I don’t have to think “IF I DONT GET A HIGHER PAYING JOB IMMEDIATELY I CAN NOT SURVIVE.” My survival instincts never get to kick in and I can procrastinate for forever… or as long as the money lasts.

I’ve gotten very accustomed to not saying no to myself. I easily justify purchases in my head, and it’s kind of crazy how you can buy something one week and a week later, that seems so far away. I’ve been better with money overall since I got my shitty low-paying job, but today I spent $200 on samples sales (oops). The bottom line is that I can’t afford my life right now, so I need to make a dramatic change, but I don’t know where to begin.

Hopefully your post can function as some sort of wakeup call to me.

laperegrina1 (#715)

Wow I created an account just to comment on this article. I want to say that it is so brave of you to write this. However at the same time your story is my worst nightmare. I inherited about $27,000 from my dad. After he died, I transferred from my shmancy but super lame liberal arts school to a CUNY where each semester was only $2500. I worked my ass off in school, and never touched a dime of his money until it came time to pay off my loans from the private college which was about $8,000 (I was only there for a year and half – i know i’m lucky). Right after I graduated I spent about $4000 of it bumming around cape cod, latin america and california for 5 months, and after that I drew the line. I know my dad would want me to do something productive and challenging like create some kind of organization with his money so that’s the plan that’s currently in the works. I feel both cursed and blessed to have an incredibly painful fear of spending money despite my inheritance. In the next few months when I feel more secure in a career I’m locking that shit up for good.

meg (#329)

late comment – but I feel like a common thread in these comments is people inheriting money before they’ve had the chance to really earn their own money and work out how much a thousand dollars really IS. one of the few life choices I’m actually proud of is that I stayed the eff away from cashing in my (stupidly generous, I’d-rather-have-my-grandparents-alive) inheritance until I’d worked for three years for a shitty wage at a not-for-profit and then put the whole thing into an apartment. no designer clothes, just the ability to live without constant anxiety.

VintageGirl29 (#723)

How fascinating. I received a $10,000 inheritance at age 24 and a $30,000 legal settlement at age 27. I used about $15,000 to pay back student loans and then I socked the rest of that money away. So at age 30 I still have about 25K of it in CDs and IRAs. The way I did it? I literally pretended that money DID NOT EXIST. I was terrified that was the only money I might ever come into (it might be!!). I didn’t even tell my boyfriend for a couple years! Though now I realize this was a bit extreme, in a way though, this worked out because now we do have money for a down payment on a house or a jump on our savings.

Niko Bellic (#311)

When all you have is money, everything looks like a purchase! Want to be photographer? Purchase an expensive camera! Want to have a style? Purchase expensive clothes! Feeling sad? Feeling lonely? Feeling lost? Purchase, purchase, purchase! Now that you ran out of money, what’s the next tool you have? Blog, blog, blog it all away.

Here is what I learned from my experience: first find out who you are and where you want to go, then figure out what tools do you need to get yourself there. Don’t just grab the first thing in front of you and start swigging like an idiot until you drop.

Myrtle (#116)

I have such a horror at this- also, admiration for the candid writing. I’ve always wondered if the cure for this might lie in learning how hard it is to earn a buck- for instance, taking a job as a restaurant dishwasher or a food waitress. I’ve one friend who also burned through a windfall, and another friend who started out as a waitress and is now worth millions, with multiple homes– and so many problems. I think she was happier when she lived in a one-bedroom apartment over a pool hall.

chic noir (#713)

@Myrtle Tell us about the waitress friend now worth millions. How did she come into such a large amount of money and property?

Thanks for your article, Allison. I hope you don’t mind my asking but are you certain that you have learnt the right lesson from your experience, and if so then do you feel able to articulate exactly what lesson you have learnt? Also, what precisely would you do with the money if you had a second chance? If you used the money as a safety net to try thing that were unsuccessful then in twenty years would you regret not having saved it?

Money can come in really fast and money can go out very fast.I setup a savings account where a can have very little access to it.No access to checks,debit cards and so on.I place money into that account every month.I have no idea what the balance is.

Brigitte Grisanti

What an idiot, she must be a liberal.

@Barack@twitter Thank you for this valuable contribution to the discourse. x

jonathan0766 (#786)

I’ve got some bad news for you Allison. Your father doesn’t know the money is all gone. He thinks you’re being responsible about it and that you don’t want to touch the principle.

Tou say it’s in your nature to be irresponsible (to buy things you don’t actually have any need for). That’s a choice, it’s not in your nature. You’re intentionally destroying yourself financially through repetitive bad / irrational choices. Blaming it on some mythical uncontrollable factor like your ‘nature’ is just indicative that you haven’t learned any lessons. You’re remorseful, but you haven’t decided to actually kill off the behavior that caused the damage, it’s just in remission. I see more financial cliffs in your future, if this article is any indication of where you’re at mentally.

@jonathan0766 if you’re giving out free psychiatric advice, i’ll take some, too please. but send over your credentials first? k thx bai

@jonathan0766 – Although you’ve put it in massively patronizing way, I do think you have a point here. Blaming your “nature” for your poor decisions is a cop-out. If you’re really unable to control your spending, then it may be an addiction — just like alcoholism or an eating disorder — that should be treated with counseling. It is worrying that you acknowledge you’d probably do the exact same thing if you had the money again.

@Logan Sachon

An interesting tactic, the “anti-credentialist” argument.

Mr. Jonathan’s opinions carry no weight unless he can back them up with credentials.

However, you are allowed to have opinions, without such caveats.

Fascinating. But not really persuasive.

Actually, your tactic could be used to shout down anyone who disagrees with you. You need not address the SUBSTANCE of the argument, only the perceived “lack of credentials” of the person making the argument.

And in any credentialist argument, one can always point to someone with more credentials, or make the credential requirement higher.

In other words, you have no point to make, do you?

Address is the argument, not the person making it.

See:

http://livingstingy.blogspot.com/2011/04/why-credentialist-arguments-are.html

One great thing about money that no one mentioned. You can ALWAYS make more of it. What do you have now? Dedication + Job = Money. Dedication + Idea + Customers = Money. 5000 per month is not hard to make. Sure last time around didn’t work out for you, but it has been a year. Just go get more. Sell houses, write software, join scentsy, Serve food. Just live below your means and you will never need more money again. Thought I would check in :) Have a great day.

@Aaron Lennon@facebook

No offense, but “wrong answer”.

The amount of money you earn in life is actually quite a finite number and one that is not to hard to calculate, within a +/- 10% range. For a given career field and choice, what you earn is pretty well mapped out for you.

Yes, I once believed as you did, that I could “just make more money” in life. And as my career took off, it seemed this was possible. But life is finite, and your working life is as well.

And often, at age 55, you may be laid off and never work again. It happened to my Dad, and I saw how it worked out. So I structured my life so I could retire by that age.

I DO AGREE WITH YOU that living within your means is essential. Spend a dollar less than you make, and wealth will accumulate. THIS is the correct answer.

Because when it comes down to it, we really can’t will more money into existence in our lives, but we can control our spending habits. Leasing cars, buying designer coffees and clothes, paying for cable and smart phones – those are all choices we make.

Making more money? That’s not really a choice, or at least not an easy one.

See: http://livingstingy.blogspot.com/2011/05/amount-of-money-you-will-earn-is-finite.html

and: http://livingstingy.blogspot.com/2012/07/how-much-money-will-you-make-in-life.html

It saddened me to read this blog. Not because she squandered a lot of money ($66,000 invested over a 30-year working life at a modest 5% would equal $285,248.20 at retirement), but because she, and many of the responders here, failed to learn anything from it.

Yes, we all make mistakes. I’ve made similar ones – bought a boat for $65,000 and sold it five years later for $35,000. Bought a vacation home and lost $100,000 when I sold it. Big mistakes – bigger than she made.

BUT – and here is the key – I learned from my mistakes. And lesson number ONE was that buying “Stuff” never made me happy, and that “things” end up in the trash within about 5-10 years.

It took me a long time, but true economic independence is in having money in the bank and no debt. And at age 53, I am finally in this situation.

But it took a complete re-thinking of my life. Re-thinking my priorities and goals. And I realized that I was chasing after false Gods by owning “things” and seeking status (which is what owning things is all about).

Now that I am debt-free and have money, I can afford to retire. It wasn’t easy. I had to sell a lot of what I owned, and cut way back on expenses. But a funny thing happened. I realized that I didn’t “need” cable TV or a fancy new cell phone – or a lot of things that were costing me a lot of money in my life.

Small things, really – things I could live without. $5 a day spent at starbucks, invested over a 45 year working career at a modest 5%, comes to $306,025.42 at retirement. No, really. Do the math.

Yet how many people do you know who complain about living “paycheck to paycheck” tell you this over a designer coffee or text it to you from their smart phone.

It is sad that this lady is now back in debt – seven grand on a credit card (no doubt at high interest, to boot). She wants to move to Austin, but feels she can’t afford to. She is deferring her dreams and goals in life to have “stuff”.

And Austin is a nice place, too.

And what makes me sadder is that many of the commenters here are learning nothing at all – and in fact just bootstrapping their own bad life choices. One writes along the lines of, “Gee, this makes me feel better about blowing my inheritance!”

That is not the answer. Digging yourself into a pit and then sharing your misery with others isn’t helping. Not digging is.

Cut back on spending. It can be done. What you think are really “needs” are likely, in fact, wants. I found this out, but it took several years.

Lump Sum payouts are a once-in-a-lifetime deal for most of us. If you get one, invest it, don’t spend it on clothes and a camera. What you are selling is your soul, your freedom, and your life.

See: http://livingstingy.blogspot.com/2010/10/lump-sum-payouts.html

“My dad immediately took me to the bank and helped me open a CD, a deposit account with a high interest rate, stressing that the money would grow, and then one day I could use it on a down payment on a house.”

Parents often give poor financial advice. And unfortunately, he put the money in an easy spot where you could spend it. Rather than a CD with a pathetic interest rate, he should have suggested first starting an IRA, where the money could be invested in such a way where it isn’t tempting you at the local bank.

And since you are young, you can afford to take a risk on higher-yielding things than CDs. CDs are for old people, not for people in their 20′s.

Diversification is another good strategy. Put some into an IRA, some into a CD, and some into – well something else. Squirrel away money to make it harder to get after. We had a credit union account in another State, and I set up a savings account there. If I wanted to make a withdrawal, I had to drive 50 miles to get there. It may be cheap psychology, but it did keep me from tapping into that money.

Sadly, living withing your means, setting up a budget, and maintaining your finances, are not topics taught in our school systems. And many parents are as clueless as we are, when it comes to money.

My Dad made a good salary – and pretty much spent it all. He would let the bills pile up and then once a month write checks. He thought (like so many of us) that if he could pay all his bills every month, he was ahead of the game.

But he wasn’t really checking to see how his overall net worth was doing. And what it was doing was barely staying above water.

See: http://livingstingy.blogspot.com/2011/01/importance-of-net-worth.html

diplostreetmix (#4,472)

@Robert Platt Bell No kidding. Putting a significant amount of money into a CD is idiotic, especially if it’s for an irresponsible college kid.

glenda (#4,344)

I did the same thing, but mine was a swimming pool. It didn’t increase the value of my house, which I thought it would, then problems and more problems, with the pool. I realized to late, I should have saved that money and I could have paid off my home loan, years sooner. I did this years ago, and am still mad.

zenaida (#4,654)

Thx for your honesty, Allison! At young age of 22 it seems your brain needed more development towards life in general, and money handling in particular. Unfortunately, the inheritance was given to you too early, you’ve been totally immature at the time. Nobody mentioned poor GrandDad, his memory and hardworking earn money don’t deserve such “disrespect”.
As for other bloggers: most of you are generation of self-centered human-beings, with huge sense of entitelemnt, cynical towards rational thinking, finicky and shallow towards honest working ethics. My 27 years old son is having great paying job around 200K PER YEAR! Yet, he is 86K in debt mostly for unpaid taxes, and CC debt. Being a brilliant student, he was lucky to get full scholarships, so there is no student loan debt, thx Lord. As his parents we love him so very much, but no matter what we say/advice about money, he just NEVER listens. he is a Bone-head when it comes to spending, so we stopped talking, it brakes our hearts to see him digging the deeper hole into accumulating debt. I wish there is a new policy in place to just stop this credit cards advertisement. The root of all evil in these ideas of giving illusion of “freedom” by letting young adults borrow from CC’s.

kofikingston (#4,818)

Well as I moved to read this blog I found that you have a natural habit of buying things and spending money this way, I am the same type like you are.
SMaRT

tjcr (#5,084)

Wow. I am quite a bit older than you, but you’ve said so much that reaches me. I also received 60,000 dollars inheritance two years ago. That kind of money, for people like us, can open so many doors. One of the first things I did was to take a trip to Ireland. But I knew — I don’t know how — that I was likely to have your experience. I think because I was so much older, I was able to save myself from the same kind of experience. For ME, it would have been a disaster. But you can make up for it amazingly fast. But I really like your essay, and people need to read it; not just to maybe learn something, but — strange to say — it’s fun to read it.

ThatJenn (#916)

I’ve come back to reread this multiple times over the year and a half since it was published because it’s really stuck with me.

My grandparents established a trust for me (and for each of my 3 cousins) about 20 years ago and have been putting some money in each year. It’s worth somewhere in the area of $100-200k now, which is (a) huge compared to my net worth and (b) not so huge that it would, say, allow me to quit my job long-term even if I had access to it.

The way they set it up is something I’m thankful for all the time: it will become mine when I turn 35. When I’m old enough that I’ve had to support myself for more than 10 years, and hopefully basically know who I am. It will really, really help supplement my retirement savings. And some of it has been used over the years at my mom’s discretion when I was in a really bad bind (some medical debt; it also made me a loan at one point), but mostly it’s just off somewhere and I act like it doesn’t exist.

I’m so, so, SO glad I didn’t have access to it at 21. One ex of mine with a much bigger trust got hers at 21 and it ran dry a few years ago after she just… didn’t work at all as an adult and lived expensive places (she is 28 and has never worked a full-time job, and while she’s occupied her time with school and art, she hasn’t really made an effort to have either lead to a career or any money-making, and now finds herself working hard to establish an actual career to support herself). If I’d had access to it at 21, my ex-husband and I would have drained it dry in just the 3 years we were together, easily. When we divorced he even tried to figure out how he could get money from it even though it’s really not mine yet, still. I was very much caught up in the same thought patterns he was and, between student loans, car loans, home equity loans (excluding actual mortgages, of which we had two), and credit cards, we racked up over $50k in debt over those three years with basically nothing to show for it (I mean, the house we bought got nicer I guess? But the housing crash happened so now it’s still worth $40k less than we paid for it). If we’d had access to $100k in cash I am very certain we would have spent every penny (his student loans that he’s paying off now already exceeded that when we got together).

Sorry, long comment, very late, but I’m just thinking about it and shivering with the horrible knowledge that I could have so easily blown all the money that I hope will someday help supplement my retirement. Honestly, even if I had access to it right now I can’t imagine I’d do anything at all with it except let it sit and grow – maybe distribute some into some good retirement accounts or something for tax purposes, and MAYBE consider paying off my car loan since the interest I pay on that exceeds what I’m likely to earn on that money. But that is a thing that comes with age and experience and the awful realization of having already done terrible things to myself financially in my early 20s/during my first marriage. My grandparents are/were smart people, thank goodness.

t2014 (#5,747)

Hey,
Don’t feel bad about it, whenever you get a large sum of money, you tend to spend it on things you want, and not the “basics”. the same thing could happen to you with a house, if you rent an expensive house you’ll regret not renting a cheaper one and it will eat through your money in less than a year, and you be left without house and money, at least if you buy “stuff” you have something to remind you of the time you had money. Also this amount only lasts for so long even if you have cheap place to live at, living for a year or two in good house and a car…
You did what most people would do.

italics (#6,613)

This is right where I am right now. I’ve realized I spend money uncontrollably when I feel as though I’ve lost control in my life. (And I mean uncontrollably comparatively. I already have a hard time not impulse buying when I’m depressed.)

I recently realized just how bad I spend when I felt out of control. I lost my job, but transitioned directly into the new one. The 4000$ I was given is practically gone and, durring the most intense moment of feeling like I didn’t have control I spent 1200 in one day on many seperate things..

I’m not going to do this again.. I am just sad that the only shopaholics anonymous groups in utah seem to be ones that “use your faith in jebus” to help you get through it. ^^;; What about the rest of us? T////T

And there I was feeling bad about 500$ of my hard earned money I had wasted. Actually I still am, this did not make me feel any better.

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