The other day, a friend and I were having a general conversation about personal finance. My friend began by complaining about some debt he has and then he mentioned how he had no idea what he had in his checking account and how he kept getting hit with overdraft fees. He kept railing at the bank for charging him and I finally had enough. I mentioned that it doesn’t take that long to balance a checkbook and that if he would just take five minutes a day to write down his receipts, he would know what he had. I think this person was having a bad day to begin with and my comment, which I intended to be helpful, not snarky, rubbed him wrong and he went off.
“I guess you think that because you’re debt free that you are more organized and responsible than the rest of us. I guess compared to you the rest of us are just losers,” he said.
Well, wow. I never would have characterized myself that way, but I had to think about what this person said. I wondered: Does being debt free confer upon me some sort of honorary degree in organization and responsibility?
In some areas, the answer is probably yes. I don’t think it’s possible to be debt free without a certain level or organization and responsibility. If I weren’t organized enough to pay my bills, balance my checkbook every month, and know exactly how much I have coming in and going out, I’d probably be in debt. If I weren’t responsible enough to save for the things I want and to refuse to buy what I can’t pay cash for, I’d probably be in debt. But does this make me a better overall person or some kind of super organized, never been irresponsible person? I doubt it because I know full well that organization and responsibility are but two components of a debt free life.
Not all people who have debt are organizational disasters or irresponsible jerks. Some people have run into circumstances beyond their control that no amount of organization or responsibility could have staved off. Some people are very organized and very responsible, but they got laid off while their emergency fund was in its infancy, or they got cancer two weeks before the new health insurance plan was to kick in. That has nothing to do with their level of organization or responsibility. Call it bad luck, karma, or whatever; it stinks. I’ve been fortunate and I know that, which is why I would not classify myself as better than the rest of the world, as the person I was arguing with seemed to think. And it’s also why I would never say that someone who has debt is a total loser without knowing the full story.
But on the flip side, it’s true that I don’t know any debt free people who are not at least moderately organized and responsible. I think the two do go together, although you don’t have to be some an organizational Rain Man to be debt free. I’m disorganized in some areas of my life. If you ever saw my desk you’d wonder about me. And I’ve been irresponsible in some areas of my life, as well. I’ve screwed some things up pretty good in my time. When it comes to money though, I employ my organizational skills and responsibility to their fullest and it has kept me debt free. Why I can’t (or won’t) do that in all areas of my life is a mystery.
So, yes, maybe I am more organized and responsible than the person I was arguing with. But only when it comes to money. Where I am organized with money, he can tell you every last car part in his garage and where to find it. I’m lucky if I can find a rake in mine at times. Where I am responsible with money, I happen to know he watches his kids like a hawk and knows their friends, their whereabouts, and everything about them. So what if he has debt where I don’t? He has other aspects of his life well under control. He is responsible and organized, just not when it comes to money. He could certainly apply his skills to money if he chose to, which is why I got so frustrated with his whining. He knows how to be responsible and he has the organizational skills to become debt free, he simply chooses not to apply himself to that goal. It makes him no better or worse than me, just a case of different priorities.