My Family “Estate”
I don’t understand much of how the rest of the world functions. What I mean is that I don’t understand how people deal with the stress! I read only a few weeks ago, directed to the news item by the folks at PeakProsperity, that very few American families could handle a $1,000 financial reversal with available liquid assets, which is to say money in a savings or checking account or, I suppose, cash lying around the house.
That would have been me as well for 85% of my adult life. First I was a college kid, then I was married to someone whose attitude toward money was not conservative let’s say, and then I was divorced and carried some $15,000 in consumer debt (see “not financially conservative ex spouse”) and owed a good $2,000 a month in spousal and child support. Since then my focus in life has been to bring stability to that part of my life. I made more mistakes along the way of course, but since 2005 I’ve retired all my consumer debt and managed, with the advantages afforded by living cheaply, to put myself in a circumstance where every month sees me go further and further into the black.
The most important decision I made along the way was partnering with a spouse who has the same attitude toward money. The next most important was residing in the neighborhood I do. Living in a difficult place has its financial advantages. I’ll never really know just how influenced by my fear of financial failure, and my disinclination for risk my love of urban living really is. Just like I never understood the kids who took AP classes in high school (still don’t, and I teach them), I don’t understand people who set the bar for financial survival so unnecessarily high.
That’s why I live in a cheap house.
Now back to my inability to understand how the rest of the world survives. My wife and I have suffered a good half dozen temporary setbacks in the last few months each of which has had a direct negative financial impact on our “liquidity”. With the death of my mother I became the executor of an estate of marginal value the stabilization of which is causing an immediate and somewhat large outflow of cash, the humble life insurance payouts intended to pay for my mom’s burial expenses haven’t quite yet made their way back to us, our checking account was hacked to the tune of a few grand in the last week, and a couple of smaller checks which, in all the chaos, we decided to mail to the bank, have gone missing. At the same time we’ve had a major appliance break down, and my wife has twice somewhat seriously injured herself while working around the house, though it must be said that the latter caused much more physical than financial pain.
All of this has led to some tattered nerves and more than a few conversations about regaining our stability. But sitting down and looking at our reality what we see is that…we’re fine. We still have a buffer which would afford us the luxury of going through the whole process again and still not having to incur any debt.
So…what does this have to do with urbanism, rational or otherwise? Living in this unstable neighborhood, troubled though it is with bad behavior and blight, has given us a very stable financial platform from which to move forward in life. This has nothing to do with living in a city per se, as a matter of fact it could pertain just as easily to people drawn toward rural living but who do so in an unfashionable place.
There are easy, relatively safe bets in life, with a $283,000 ranch houses and a $5,000 a year property tax bill in a neighborhood requiring 2 cars which instill a “keeping up with the Joneses mentality. Those places are very stable I suppose because they involve a lot of the same kind of people who’ve opted for that same type of stability. It’s a kind of all or nothing stability though, where you pay hugely up front in order to stay within the safe zone. Instability becomes defined by the inability to pay the ante, and that can be so high that even a small reversal can lead to debt which leads to the margins becoming ever finer with every occurrence.
My wife sits and works in a spot in the home that gives her a view of everything that happens outside our front door; what she sees is a very unstable place. She could fill a book with just anecdotes describing odd behaviors she has witnessed from that one spot. Sometimes it is, as I was accidentally warned many years ago, “The Wild, Wild, West” out there, but, financially in any case, that allows us in here to live a very civilized life.