I was in my mid-twenties when it dawned on me that my credit card debt would never disappear unless I did something about it. To that end – as with most goals in my life – I became aggressive and obsessed. To the point that I may have even ruined a friendship over it.
I had read every book I could find by the personal finance greats: Dave Ramsey, Lynnette Khalfani, David Bach, Michelle Singletary… And I took all of their lessons to heart. I committed to saving, budgeting, and debt elimination. In hindsight, I realized my budget and spending plans were quite austere. But since I was beginning to see the benefits of their advice in my financial life, I ignored the pangs of deprivation. My emergency fund was growing, my credit score was improving, and I was making a huge dent in my student loans and my credit card bills.
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At the same time that I was in “extreme debt elimination” mode, I was taking an Afro-Caribbean dance class. One night it was pouring hard. Relying on public transportation guaranteed that I would get wet – and possibly sick. My new friend and dance partner, Eve, offered me a ride home. I graciously accepted.
A few weeks later, as we were getting ready for our final performance, I offered to run to the corner store for snacks and water. I asked her if she wanted anything.
She only asked for water, but I waited for her to give me a dollar to pay for it.
I could immediately tell from her reaction that she was (rightfully) taken aback. Her face showed it clear as day.
As money karma would have it, 10 years later I was sitting in my stylist's chair getting my hair done. After she twisted the last lock and prepared me to sit under the dryer, she told me she was running to the store. Did I want anything?
“Maybe a water,” I said.
But when she stood stiff and there was no more hair to twist, I realized that she was waiting for me to give her a dollar. And this despite our 10-year relationship, which included generous Christmas tips, patience during double-booking, and a listening ear about her quips and complaints about life.
I took a mental note as I swiftly dipped into my purse for the money. In doing so, I couldn’t help but think about my dance partner from the Afro-Caribbean dance class. I fully understood the look of disgust, dismay, and shock that registered on my old friend's face as she forked up the dollar bill over a decade ago. Now, at the salon, I was feeling the exact same way, but hoping my face wouldn’t rat me out.
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Having been both sides of the water-buying debacle, I’ve learned a few things about money, social currency, and friendship.
1. There’s a Huge Difference Between Money Knowledge and Money Wisdom
Once I decided that I wanted to be debt-free, I became committed. This was good, but I was also sorely myopic in my thinking.
I internalized the urgency of financial freedom from the literal dozens of financial literacy books I read.
This made every financial transaction a threat to my safeguarded goal of financial independence. Had I had more money wisdom, I would have realized how cheap and unnecessary my behavior was. If a person can’t spend a dollar on a friend without repayment, then they shouldn’t be friends.
2. Favors are Payments, Even If There’s No Money Exchanged
My dance partner went out of her way to make sure I got home safely that rainy evening all those years ago. If we quantified it, she saved me what would have been a bus, train, or taxi ride. I learned that I should never overlook others’ kindness. You lose the goodwill and esteem of your friends and associates when you do.
3. Zero-Sum Budgeting Doesn't Work for Everyone
If you’re the kind of person that obsesses over every penny, then you may need to rethink your budgeting strategy. With zero-sum budgeting, there’s a tendency – although not intentional – to be ruthless with discretionary spending in an attempt to maximize savings and investing. This approach can create unnecessary tension in your relationships if not monitored and planned for accordingly.
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4. It Feels Good to Give, So Do It as Often as You Can
As humans, we're wired to reciprocate and up-level unsolicited largesse with premeditation. For example, if a friend does something nice for you out of the blue, you’ll note it and try to think about ways to add value to their life in return, sometimes in ways that far exceed the initial overture. If you build your generosity muscle, you’ll never run out of friends – or funds. I promise.
Becoming debt-free is an admirable goal, but it takes financial maturity and perspective to ensure that you reach the end of this journey with all of your relationships intact.
