Having mountain of debts is daunting and I had countless sleepless night, thinking about how long it takes to be debt free. My heart was never at peace for as long as I have to face the ‘mountain’ daily. I had insomnia and I couldn’t put my heart to do anything. I lose the joy of living after my husband incurred enormous debts during the Asian financial crisis. It is sad that our children have to suffer when we, the parents make bad choices. I often question myself the meaning of life and why I have to go through hardship when I did not make the bad choices. However, God reminded me of the marriage vow which I pledge before Him years ago.
It means that I have to share whatever debts my husband incurred. (…. for better, for worst, for richer, for poorer, ….) Similarly, if he is sick and bedridden, I have to take care of him for as long as he lives ( …. in sickness and in health, to love, and to cherish,…) He had brain cancer and was on wheel chair after nine months into his treatment. He was bedridden towards the end stage of his sickness. I was like living on earthly ‘hell’ as I have to attend to him 24/7, while taking care of the household chores and the children’s affair. I hired a live-in domestic helper but it lasted only nine months as my husband dislikes having a stranger living in the house. I took care of his daily needs for more than three years, until his last day.
How many of us actually give serious thought about the wordings contain in the marriage vow before making plans to wed? I did not and I don’t know precisely what it is all about until my wedding day. Prior to my wedding, I have vague idea on the marriage vow. In fact I had chilled bone after I give serious thought on what I have said.
Having gone through a few crises, I have learnt my lessons the hard way. Practically I cruise through life with a simple mind and believe goodness in my love ones. Unfortunately, the reality of life is cruel and has proven me wrong, because people change. But by the grace of God, He took care of all my concern and deliver me out from a seemingly bottomless pit.
I kept thinking about these verses when I was extremely hopeless during those difficult years. Matthew 7:7-8(NKJV) “Ask and it will be given to you, seek and you shall find; knock and it will be opened to you. For everyone who asks receives, and he who seeks finds, and to him who knocks it will be opened.” I often recite bible verses whenever I need to motivate myself to have faith in God for deliverance. I pressed on and believe God is my vindicator. My husband and I took ten years to clear all of his debts. How do we get out of debts?
The followings were some of the things which my husband and I did during our financial crisis:-
1. PRAY. I wasn’t a spiritual person and I don’t pray or read the bible regularly. Unfortunately when crisis fell on me, I have no one to turn to except for the merciful and gracious Lord. I prayed intensely for the first time of my life as I was fearful of what would become of my family. I prayed for wisdom and divine intervention. I was given the wisdom to do what I have to do the first thing first, that is to raise money quickly to pay as much of his debts as possible. I didn’t want my husband to become a bankrupt and have undischarged loans. His career would be ruin if he were to declare bankruptcy.
2. RAISE FUND.
2.1 TERMINATE. We terminate our endowment insurance policies to get whatever cash value that is due to us. We terminate both ours and our children’s endowment insurance policies prematurely to obtain the cash to reduce debts. I borrowed from my insurance company using my whole life insurance plan’s cash value. My husband only have term and endowment insurance policy. Thankfully, he still had his term life (with illness coverage) insurance plans after he terminates his endowment policy.
2.2 SELL TO GENERATE FUND. We sold our two year old car. My husband bought the car while he was already heavily in debts (I wasn’t aware about his debts then). The cash generated from the sales of car was not much. In fact we made a huge loss as it has depreciated a lot the moment we purchased it. We sold our social apartment (government subsidized apartment) and use all the profits to reduce debts. We went to stay with his parents and four of us squeezed into a big room.
2.3. BORROW. Basically we borrowed from Peter to pay Paul. He made use of cash advances from one bank and pay to another. He had a total of six credit cards account, one credit line and an overdraft facility. We also borrowed some money from friends and relatives to settle of his debts.
3. INCREASE INCOME. Reluctantly, I forced myself to get a part-time job. After being a housewife for almost a decade, I was fearful and apprehensive to enter the work force again. I was a computer idiot. I didn’t know how to use the computer at all as I was too busy with cooking, household chores and taking care of my young children. I have lost touch of the society for too long to feel comfortable working again. I had a lot of fear and I struggled mentally for a long time before I took the courage to send in my application form. Though the money I earned as a part-time cashier was not much, it provides some extra cash for the family.
4. REDUCE DEBTS WITH THE HIGHEST INTEREST FIRST. We make more payment to reduce debts from the highest interest rate. Our intention is to have slightly lesser amount roll over every month from the higher interest debts. As for the lower interest overdraft, we just pay the minimum sum and let the balance roll over until the higher interest debts are fully paid first.
5. SAVE. Yes! In the midst of your debt crisis, it is essential that you have some cash set aside as getting personal loan is extremely difficult. I set aside at about 5 percent of our total income to save for emergency; and use majority of the balances to pay debts after accounting for our monthly expenses. When you are in debts, it is important that you have some cash set aside for emergency needs, e.g. medical bills and children school needs. I also saved my one dollar loose coins. It was and still is nice to see some real cash growing in a glass canister. I used the money to buy groceries or give my children treat at McDonald once in a blue moon.
6. STOP USING CREDIT CARDS. We used cash for all our expenses. Since my husband used cash advances from his credit card accounts to pay his debts, I didn’t want to add on to the debts and roll over the balances. The consequences would be horrendous as the 1 per cent interest has ridiculous multiplier effect if allow to snow ball every month.
7. REDUCE OR CUT SPENDING. Cut all unnecessary spending and live within budget. We stopped the newspaper subscription and read free newspaper that is available. We stopped going out for leisure so as to avoid spending unnecessary. We did not go to the movie or anywhere that need to spend money for many years. We rarely dine out since we have debts. Even if we need to, we eat at the cheapest food stall that we can find in the neighborhood. No shopping for extra things, except for the things that we really need. Even when something in the house needed to be changed or repaired, we learn to live with the defects, if they are not serious enough to warrant immediate attention.
8. LIVE WITHIN BUDGET. For the first time after marriage, my husband let me manage his monthly salary after his financial crisis. He was in charge of writing cheques to make his monthly debts repayment while I manage the family expenses. I gave him fixed monthly allowances for his meals at work. He learnt to live within his own budget. He even managed to save the little money he has from his small allowances. He would discuss with me if he needs to buy anything extra. If I said “we cannot afford”, he would not insist. In the past, he would ignore and proceed to purchase whatever he likes; regardless of my reasonable objection. We stopped buying tit-bits for the family and only treat them occasionally. We stopped going overseas for tour.
9. MAKE LUMP SUM PAYMENT WHERE POSSIBLE. My husband made lump sum payment with his yearly bonus. He tried to make more payment to clear his debts whenever he has extra cash income. When my dad passed on, he left me with some money; I used it to reduce our debts.
10. KEEP YOUR FAITH AND HAVE HOPE. When you seek the Lord Jesus earnestly with prayers and thanks giving, it pleases Him. Even though I didn’t know when the enormous debts are going to be cleared, I remembered praying numerous times daily and claim on the words in the bible. My used to recite my favourite scriptures, Psalm 23:1 “The LORD is my shepherd, I shall not be in want, …….” Whenever I was depressed, I kept humming an old hymn – “Jehovah Jireh, my provider, He shall supply all my needs. He shall supply all my needs, according to His kingdom and glory. He put His angel charge over me; Jehovah cares for me, for me……”
I believe my faith and hope in the Lord has helped me go through tough journey. The bible said: “Faith without action is dead”. Hence, I reminded myself to do my part as I put my faith to work. The bible also said that among these three: faith, hope and love; love is the greatest of all. (1 Corinthians 13:13) If I have faith and hope, but have no love for my spouse, children and others around me, I will not be blessed. Such revelation comes during time like this when I became more spiritual. I forgave my husband and show more care and concern for him. I want to be willing and obedient to do what the LORD said I should do as I want to be blessed.
I work hard even when I was only a part-time cashier. I was blessed with double promotion as a part-time staff; and became a Team Leader and subsequently a shift Supervisor with pay increment within a year of employment. It was uncommon to earn more than a thousand dollar by merely working five to six hours a day, two to three times a week. Besides, my husband got his pay increment during the first four years of his financial crisis.
11. LEARN TO FIND JOY IN THE MIDST OF YOUR FINANCIAL CRISIS. We used to travel every year but stop since the financial crisis. We didn’t travel for four years. However, when our financial situation was better, I set aside some cash for family bonding activity. When we were not travelling during the four years, I had no time to bring the children out at all as I have to work seven days a week. I had two part-time jobs initially. Subsequently, I took up a full-time job and keep one of the part-time jobs to earn extra income.
My husband had no mood to bring our children for outing when I was at work.(I work 7 days a week) My children were like living in prison at home. As such I planned for a 4 days holiday to Malaysia, Genting Highland on the fifth year into our financial crisis. We didn’t spend much during the trip as Singapore currency was much stronger than that of the Malaysian Ringgit. The children were having a lot of fun and I have a good break from juggling between two jobs and household chores. A few years thereafter, we even travelled to Korea in winter for the first time with the extra cash I set aside. My children were overjoyed as they experience snow fall for the first time in their lives.
IMPORTANT LESSON LEARNT
It is necessary for everyone to be educated in basic financial management. You can obtain financial knowledge through the internet, reading, attend seminar and workshop. Remember not to allow greed and temptation to get rich within a predetermined time frame cause you to fall in the process.
To have incompatible financial perspective can be perilous for a married couple. Before anyone decides to consider getting married, assess your potential partner’s financial views and belief system. It is crucial for a couple to have his/her financial views, expectation and plans clearly spell out before settling down. During courtship, it is good and wise to assess the financial views of your potential spouse.
Signs of potential marital problems arise due to financial incompatibility can be clearly detected: (1) If you are careful with money and prefer to make plan for the future, but your potential spouse is not interested in budgeting and plan for the future, (2) If you are a saver, but your potential spouse is a spendthrift. (3) If your potential spouse is stingy on others, but he/she is willing to lavish on himself/herself; or vice versa, (4) If your potential spouse is selfish and materialistic, but you are the opposite. However, it would be perilous if both of you are alike in this aspect.
It would be foolish to think that he/she will change his/her financial perception and belief system after married. It is very unlikely and difficult to start with since this learned or inborn behavior has been with the person for decades.
It is common for the very rich and famous to have prenuptial agreement signed in order to avoid unnecessary dispute in the future. Many people are marrying later after they have established their career. Some of them may have properties, insurance policies and substantial wealth accumulated, while some may have children from their previous marriages. As such, a prenuptial agreement is needful to put things in place.
After what had happened to me, I believe anyone who wishes to get marry should consider having prenuptial agreement signed, including Christians. I knew of a few Christian friends suffered when they have marital problems. One friend had to battle with his ex-husband in court to keep the house which she bought with him when their marriages break down. It was a long and tiring proceeding since the house worth a few million dollars. She and her children suffered emotionally and psychologically as her husband divorced her in order to marry someone else.
For the young couples who may have just started work and have not much money or property to start with, it is always good to state how the future assets should be distributed in the prenuptial agreement should the marriage break down. A few minutes of upfront planning has the potential to save headaches and tremendous financial hardships in the long run.