My neighbor Katy thinks that writing this blog about my finances may be cathartic for me.  Actually, it scares the shit outta me:  the idea of admitting publicly that I’ve failed.

To honor my obligations, that I’ve let myself and my family down and people that depend on me.  Maybe that’s a bit too grandiose of a statement, I mean, after all, who really cares?  Truth is I made bad financial decisions and let my debt spiral out of control.  It didn’t help any that I was getting a lot of bad advice and aggressive assistance form a financial system and culture that wanted to profit from my ignorance.

My finances are a mess.  I’ve got $39,000 in credit card debt, another 35,000 in a HELOC on my first house, which is upside down by the way (I still have a 1^st mortgage for 202,000 on a home that is currently appraised at 123,000), my second home is teetering on foreclosure, but there are two offers that the bank is reviewing on a short sale and I owe about 2,800 in back HOA fees…and how the hell did I get here?  You don’t even have to ask.  I agonize over it DAILY!

The past year and a half I lost more that half of my income.  I make my living as an actor and I moved back to LA just in time for the writers strike, then SAG threatened their own…yeah for me!  What timing, huh?   I was also renting out my first house and that would have helped me weather the economic storm, but my tenant got into a fight with his girlfriend in my house and she shot him.  He (unfortunately) lived and he didn’t tell me for over a month when he was late with the rent.  By the time I found out he had left my home a mess- $3,000 worth of back rent and damages (thank the Lord for insurance and my brother who helped out, or it could have been much worse)… so I ended up carrying 2 mortgages for almost six months.  Went through all my savings and my 401K.  Then a creative project that I wrote was being produced and was hijacked from me, which meant lawyers and fees to protect my rights and royalties on the show.

OK, so, that’s enough of my back sob story.  I mean, the drama and the rotten luck, enough already!

I filed for bankruptcy a couple of months ago, but there’s still a part of me that thinks at the 11^th hour I’ll land some fabulous job and that all my money woes will be over.  I mean it happens all the time, people’s lives changing on a dime in this city, right?  God, I sound like a gambler.  That fantasy has kept me going these past 22 years as an actress, “Someday I’ll get my big break:  that TV show or that Broadway show…”It’s embarrassing to admit that I still hold out hope.  My boyfriend told me a great statement the other night that someone made about the acting profession which goes something like “It’s not the despair that’s killing me, it’s the hope!”

Actually, I’ve made a good living as an actress in Los Angeles and in regional theater over the years so I consider myself damned lucky, so I know I have to give myself permission to feel good about that.  It’s not been completely a fool’s dream.

I bought the houses for an investment, because I am in this profession and I wanted to begin to build some kind of financial stability for my future.  Working freelance, which acting pretty much is, is just so nerve-wracking for me.  My brother talked me into buying my first place.  “You’re not gonna make the same mistake that you did in the 90’s are you?”,  he asked when I booked this really good production show.  He sells real estate and was trying to get me to buy a house in San Diego in the early 90’s but I thought, “$150,000 for a 3 bedroom house?  That’s too much!”  If only… So, I went for it.

I learned a lot during that time.  I was curious about money, because I never got a financial education in school or from my parents.  I didn’t know that just because you balanced your checkbook it didn’t mean you were managing your finances.  I was quickly, but not quickly enough discovering how little financial literacy I had.

Credit scores was an interesting discovery for me.  I found out mine was pretty good at the time- around 749.  When I was buying my first house I wanted to pay off all of my credit card debt and close my cards, but was told not to do that because it would ruin my score and I wouldn’t qualify for a good rate.  I was told to keep the balance at around 30% of the balance. It didn’t make sense to me, but I was following this “expert” advice.

I also discovered that when you buy a house, everybody wants to give you money!  The credit card companies bombarded me with offers.  And, oh remember those little “convenience checks” they would send you in the mail?  With those comforting little sayings “pay now, worry later”?  And then finding out about those obscene interest rates.

And of course with my new house I had to have furniture!  All I have to say is God save me from HGTV.  It is like porn for me.

Interest rates are Satan!  How the hell can anyone charge you a 24%to 29% interest rate?

Well, I qualified at the time for 3.99 to 5% rates, so I rolled over my debts into low interest cards.  So fast forward to a couple of months ago, I was one day late on a credit card payment and they hiked up my rate to 29.99%!!  WTF?!  So I called and they said I had violated the terms of the contract.  I spoke to a manager and she said that she couldn’t change the terms of the agreement and that I hadn’t opted out.  “Opt out? What was that?”  “Oh, it was mailed out in one of your previous statements”  “What the junk mail that you pack my statements with?  Besides, I pay online.”  “Well, we can close your account and give you a 17% interest rate.”  “But, I’ve been a customer for 7 years and I was only one day late, it was an oversight (not to mention I noticed they started to change the due dates on the account)…”  Of course now Obama introduced legislation that forbids these kinds of practices, which the banks are fighting fiercely.

I’m convinced debt is the new slavery.  But, I was a willing participant.  I got caught up in the culture of the new millennium :  ENTITLEMENT.

Remember all those shows at the beginning of 2000?  “Who Wants to Marry a Millionaire?” “Joe Millionaire”, “The Survivor”, “The Apprentice”?  Then all those money gurus like Richard Kiyosaki of “Rich Dad, Poor Dad”, Donald Trumps “Think Big and Kick Ass” and Suze Orman who, bless her, was trying to beat some sense into us.

Then the new age metaphysicians and the cult of “The Secret”:  think, desire, believe and manifest what you want.  Hey, I was definitely mesmerized by all of it.  I was going to a spiritual counselor who told me to watch that DVD for 40 days!

But, I bought into it…literally, bought it all.  Thinking that I could keep up, catch up, that my next gig was just around the corner,  if I could just stay focused, keep working, it would all work out…but it hasn’t.  And my Polly Anna optimism is eroding with it.  Maybe it’s called growing up.  That I need to measure my wealth in different ways and  not define myself or measure my worth by what I have.  Consumerism was literally consuming me.  This past year and a half I’ve been plagued with insomnia, dizzy spells and now these panic attacks when I approach a bridge.  I have developed this terrible phobia of bridges and actually had to call my brother to help talk me over one when I was driving.  Now, I just avoid them.  I know this is just a manifestation of the stress and the fear I have around my finances:  feeling out of control not feeling supported.

But, I hope reaching out like this helps in some way.  Maybe feeling that I’m not alone, that perhaps there is a network of people who can relate, advise or enlighten me.  Maybe just the act of speaking the truth, that I don’t have to be perfect and that I’m still valuable as a person and that I have something of value to offer while I am on the planet.  I do have to admit, the man that I have in my life has been such a blessing to me.  I’ve confided in him about my financial situation because I felt it was important for him to know exactly what my situation was, even showing him my bank statements and debts.  That was very hard and I was afraid that he wouldn’t want to be with me because of my debt and my feelings of disappointment in myself.

Then he just looks at me and tells me that that doesn’t define who I am.  Then he tells me that he loves me and that he knows who I really am: that I am a caring, good person with integrity, that I am talented, smart and beautiful and that he believes that I have what it takes to handle any situation.  And it makes me feel so comforted.  I tell ya, ya can’t buy that.

Thanks for letting me share, Katy. J

Karole

Tags: 401K, actor, bankruptcy, credit scores, debt, failed, finances, foreclosure, HELOC, HOA, hope, house, housing, interest rate, mortgage, Obama, publicly, SAG, Satan, savings

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