HONESTY CIRCLES - WHAT DEBT HAS TAUGHT ME ABOUT MYSELF AND CHOICES

Oct 23, 2014
Photo by Towfiqu Barbhuiya on Unsplash
"This shirt looks pretty good but it costs $150. Should I get it? Yeah, maybe I should. It's a small part of my pay cheque and you can never have enough shirts right?"

And that's how I got that $150 shirt and 10 others like it.

"Mmmmm.. that Salmon belly sashimi plate costs $16. And I really like it. There's other stuff on the menu but.. Salmon belly sashimi, man, I could really have some of that."

And that's how I ended up having $20 lunches most days.
 
"That's a $5 coffee.. mmmm I like coffee. It's a bit expensive but.. I need coffee to work. Okay, I'll have this coffee because it helps me work better."
 
 And that's how I ended up having 2 $5 coffees a day.

"It costs $10 to get to the office by cab and it takes 5 min. It will take me 25 min to get there by train. I need to take a cab. It will save me more time to make important work decisions."
 
 And that's how I spent $20 a day taking a cab to and from work.

"That hotel costs $300 a night and it looks really awesome, should I book it? Yeah I should, I've been having a hard time at work and having a vacation means you need a good place to sleep. I really need to stay there."
 
 And that's how I ended up paying way too much for accommodation every time I travelled.

At that time, I was 28 and the partner in a relatively successful game company. I drew a monthly salary of $5,000 but I saw very little of it by the end of each month.

"It's okay, we'll sell the company for lots of money later on. Right now, my time is important and I need to pamper myself, so I can make good decisions. Nobody makes good decisions when they're uncomfortable." This was my mantra and it was how I justified most of my purchases.

But, have you ever had that feeling that even though you were comfortable, you weren’t at peace? Have to ever felt like you were chasing something? A better life, perhaps? But what does a better life mean, exactly? Upon reflection, I realized that at that time, I was grasping at anything that would give me a temporary feeling of a “better life”. And gee, I spent an awful lot on myself only in those days didn’t I?

Then, 2008 came. The company was close to sealing a $1m investment and I thought I would finally be able to have a big pay cheque after all my hard work, then I would truly be able to live THE lifestyle.
 
But by July, the US financial markets had bottomed out and venture capital firms had started to issue warnings about the economic uncertainty and the impact on startups. By end 2008, our investors had pulled out and my business partner and I were left with $100k left in the company account, 5 staff to support and potentially $150k in upcoming project costs for a game we were making to be finished and shipped.

The investors pulling the plug was a big blow for us. We'd already committed to a large project on the Nintendo Wii in anticipation of the investment being closed and we were already halfway through the development cycle. We were caught off guard and had to decide what to do with the remaining capital.

Both my partner and I decided not to draw salary. I would fund my own expenses and cover some of the costs to further develop our PC online game, which was doing relatively well, and he would fund the Nintendo project as he had had more finances in the bank.

Having $0 salary, you would think that I would have changed some of my habits.
 
Let's see..
 
 "It costs $10 to get to the office by cab and it takes 5 min. It will take me 25 min to get there by train. I need to take a cab. It will save me more time to make important work decisions."
 
 "That's a $5 coffee.. mmmm I like coffee. It's a bit expensive but.. I need coffee to work. Okay, I'll have this coffee because it helps me work better."
 
 I didn't have $20 Japanese lunches anymore but I would have $10 sandwiches.
 
 Yup, not much had changed. There was $0 coming in, but the outflow wasn't that much different.

This all began to snowball and by the end of 2009, I found myself $20,000 in debt. I remember the day reality hit me. I'd maxed out both my cards with ~$10k limits and I realized I had no way of paying. I could not even afford to pay the minimum sum and I had $0 coming in.

There were things I couldn’t control (like the economic cycle) and there were things that I could (like my own spending, and the choices we made within the company). There were things that I needed and things that I wanted. Looking back, I don’t think I could tell the difference and I don’t think I took the time out to make the effort to consider my choices. I was always on the go and always reacting.

6 years on, there is an upside to the story.. Since we started off on the topic of clothes, I should perhaps sum up how my choices have changed by reflecting on my choice of clothes. Today, my wardrobe consists of exactly 5 plain black round-neck t-shirts, that cost me $25 each. It’s pretty much the only thing I wear out every day.. and I couldn’t be happier. :)

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