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THE FRIBBLE
Thursday, September 16, 1999

Pre-Fool Foolishness

By timestitch@fast.net

I discovered the Fools just this summer but my husband and I have been Fools (by definition) since the summer of 1984. Back then my husband and I were teachers. I had just spent the school year on sabbatical leave getting an M.Ed. In August of '84, my husband took our six-year-old BMW in for servicing. He naturally had to test drive a newer and bigger model Beemer and, of course, fell in love with it (who wouldn't?). He came home and wondered aloud, "How can we afford this car?" I Foolishly said, "Let's make a list of our monthly incomes and our monthly expenses. Then we can see how we can afford the monthly payments. I'll get a ledger book and we will make a budget."

We began by writing down our monthly salaries for the coming school year first on a sheet of paper. Then we listed every possible expense we could think of: loans, bills, credit cards, taxes, mortgage, entertainment, and vices. For us, our main vice was purchasing antiques -- especially clocks. Since searching for them was also our main source of entertainment, this part of our expenses was high. We listed, literally, everything.

Staring at the list we had a catharsis: We owed money to insurance companies for loans against our policies; we owed money to credit unions for car loans and personal loans for antiques. We had credit card debt but not in the thousands (thank God), and we had been foolish because we had no savings except for the two IRAs we had opened the first year they became available (and even they were opened ONLY to cut back on our income tax bill and invested on the 15th of April for the year past). There was no thought of investing for the future then!

Our savings plan at that time was to save enough in the school year in order to have money to last us through the summer when there were no pay checks. But always by summer's end we needed a loan to make it through to our fist pay check! But now we had a different goal: a new Beemer!

We started by budgeting by the month. We listed all of our bills for September and calculated how much we had left over (with two incomes and no children we certainly should have "left over"). We were even able to budget an amount for our antique purchases. We gave ourselves some cash to spend and we did two things that were Foolish: 1) We started to put money in our IRAs for the year we were in, and 2) we saved.

We became more Foolish by budgeting for each pay period. We listed our bills in the order they were due and paid them. And we could see the money in our savings account build! More Foolishness followed. We listed our summer budget months in advance to make sure we had the money in the local bank for our expenses (and we swore we wouldn't blow it on an antique at the beginning of the summer and we didn't.) We were even able to buy a tandem bicycle in August (and a good one for $2100) and not break our budget.

As the years progressed we got more and more Foolish. We invested in the stock market, more mutual funds, and always paid our credit cards on time. We pay cash for all major purchases, cars included (too bad they wouldn't take Discover for that!)

So what about that BMW my husband wanted to purchase in 1984 that started all this Foolishness? He never bought it. We kept the BMW we had for another 13 years and sold it privately. We purchased a used Mazda in 1997 (for cash) that gets great mileage and gets us from point A to point B in the same amount of time but more comfort (it has air conditioning) than the Beemer.

But best of all? I was able to quit teaching 10 years ago and turn my hobby into my full time job (I am a quilter and quilt teacher). My husband was able to purchase his four years of Marine Corps service time (at a price of $32,000 lump sum) for his pension fund and retire at the ripe old age of 48 back in 1991! He now repairs antique clocks, does house painting (or even barns or sheds for that matter), and works part time for the school district he taught in. We continue in our Foolish ways and enjoy reading about the Foolishness of others on this site. So as they say, Fool on!


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