Confessions of a real money coach Part one

I was wearing my beautiful coat, dropping my son off at school on the way to my office. He turns to me and says, “Wow mom, you look so rich in that coat. Really rich! Too bad you’re driving around in such a clunker. Bye mom!”

And away he goes. Ah children. They have such a lovely but strange way of speaking the truth, don’t they?

Yes, my car was awful. In fact, it had come to the point where I hated my car. It was very old and I admit I’ve stopped properly maintaining it. Embarrassing but true! My dad would be aghast if he knew how often I checked that oil… (Sorry dad, I know you’re reading this.) And I had even stopped emptying the clutter out of it. (Clutter is a sign of many things…) I was silently protesting the car by simply not caring about it.

Now cars aren’t everything, especially to women. We generally don’t need the car to shore up our self-esteem, or project our image out to the world. But… I felt out of alignment. I was the director of the Women’s Earning Institute, a money coach, and my damn radio had stopped working.

Replacing my car has simply been on the back burner. I’ve been very busy for several reasons. (Running a business, single parenting, buying and rehabbing a house and getting that divorce does take time….) Maybe that is why when the urge to buy a new car hit me, it hit with full force, a full blown hurricane of NEED-

I need a brand new, bright shiny car and I need it right now! And by god I deserve it! I work hard, and this is absurd. What kind of message is this sending? I hate my car…..I’m sick of this piece of shit. I don’t enjoy driving around in it, and the truth is that I do like driving and I enjoy cars. I’m sick of feeling so deprived…. And this is getting embarrassing!

The wail was almost deafening, especially after I dropped my son off at school that day.
Ah, but I have training in this type of thing- emotionally fueled spending that can really bite you in the butt. So I calmed down and asked myself: what is really important here? What is the need beneath this need? Do I really NEED a brand new car?

Well, the real need was a better car- a more reliable car that I felt safe in. And the want was a car that I enjoyed driving. I do love driving. (I would never drive an automatic because that’s no fun! So there’s a clue.)

Okay, so the next question I would ask a client is: Is there a more creative way to meet this need that won’t cause you undue financial stress, or won’t derail you from your financial goals?

God, I hate those irritating questions. I mean really. Was my inner money coach asking me what I could afford? Boring!

But I also noticed that while I had started to shop the car ads and was starting to regularly cruise www.autotrader.com, and had even gotten myself up to Lynnwood Honda on a brave day to “test drive” a new and a used car, I wasn’t really about to pull the trigger.

Why? Because I hadn’t completed my personal 2010 annual spending plan. My life is so different now than even a year ago. I have a new mortgage, my son has started a martial arts program with a monthly fee, and the dentist wants us to see the orthodontist. (Damn! That is my “wusband’s” fault- my son inherited his father’s lower teeth. Mine are perfect!)

Oh, and I have other wants next year too. It wouldn’t be very fun to have a brand new car and then not be able to afford any fun three day weekends cruising around the peninsula…

Sigh.

So last weekend I completed my annual spending plan to look at how much I want and need to spend in 2010 relative to what I am going to make. (That’s a whole different post. I’m still writing that one.)

And I came back to those irritating questions: Is there a more creative way to meet this need for a new car that doesn’t cause me undue stress or won’t derail me from my goals?
Yes. The answer was to buy a decent used car. Hmmm. But I want a new car!

Could I buy a brand new car? Yes. But at too high a cost. If this was a year in the future, I may feel different. But I am in the middle of a divorce and am still settling into my new house. I can’t change those facts. It will get easier. But why would I stress myself out by adding a high monthly payment to my life?

Ideally, I would pay cash for a new car. But that would mean emptying out my safety net. And my savings has already taken a huge hit with rehabbing my house. And if I have no safety net- my cash fund designed to catch me if I don’t bring in my paycheck (I am self employed, remember) or I’m hit with an expense so huge that my regular monthly savings habit can’t cover it– I won’t be able to sleep at night! Gulp!

In a year, maybe I could buy a brand new car for cash. But by then my car may start leaving parts behind it on the road. (Being a Toyota, it will never truly die. It will just continue its slow process of decay.)

So I wrestled my annual spending plan to the ground during a long boring football game (my beloved Seahawks suck this year) and came up with how much cash I could put down from my savings and what monthly payment I would be willing to make. I looked at the cost over the whole year and came to peace with a number.

Then I marched off to my bank to take out a small auto loan. After much debate with my nice banker Brad (they weren’t super thrilled with my debt to income ratio because my mortgage is brand new, but my credit score is very high and I don’t carry credit card debt) they gave me a $10,000 car loan. And of course I could pay it off early with no penalty. And since I do have some cash, I may not use all of the loan. (My inner money coach watched this all very carefully, noting how the monthly payment would fit into my monthly spending plan.)

So now it was time to find a car and negotiate the price…

And again- gulp!

I do like cars, but I don’t really know jack about the inside of them. Hmmm. The prospect of cruising car lots on my own was daunting, to say the least.

(Curious what happened? Here is part two.  It’s good!)