Chris McGinty – Enemy of Debt – Episode One

by Chris McGinty (According To Whim .com)

Hello, and welcome to the newest feature on the According to Whim blog:

Chris McGinty – Enemy of Debt

Episode One will be a means by which to explain the scenario and give the disclaimers. You know what? Let’s start there.


Oops. Wrong alert.


The events of this feature are true. I will of course change the name of the person I’m helping. I am not formally trained in personal finance, nor am I a financial advisor. The advice that I’m giving is the advice of a friend to a friend. I am helping him free of charge, and only because he asked me. While I am going to make light of this for entertainment sake, this is pretty serious situation as you will soon see. If you are facing anything like this, you should seek professional assistance from a certified financial counselor.

So what is it exactly that is going on, and why do I think it will make a good feature? What is going on is that a friend of mine contacted me Sunday night. We’ll call him Genghis Conner. Genghis explained to me that he is facing eviction and repossession of his van. He perhaps did his best, but his best was unfortunately based on emotional decisions that put him in a worse position. He has a wife and children, and for that reason he can’t just scrap it all and start over.

Genghis explained to me that the reason he’s facing eviction is that he only had $265 of the $610 rent. He felt that should be enough until he got his next paycheck on July 20, 2011, until the served him papers for an eviction hearing on July 22, 2011. The eviction papers read that he owed $710, plus $10 a day in late fees. Every two weeks he makes $960 before taxes. Around $160 is pulled out every two weeks for child support for a child from a previous marriage, as is an additional amount for health insurance required by the child support order. This usually leaves him with around $600 net pay.

Here’s where the trouble comes in. He has a title loan on his vehicle for about $1,500, which was taken out in February “because we were about to get our tax return anyway.” The problem is that the child support is in arrears, and so the tax return was garnished in its entirety. His wife filed an “Injured Spouse” form to get her half of the return. When she received her half, they paid down the loan a bit, but he ended up borrowing it back

Furthermore, he has three payday loans out: $250, $265, and $600. These were taken out over the last few months trying to keep up with their slipping bills.

His wife gets child support from a former marriage that is somewhat sporadic depending on how much is being garnished from her ex’s paycheck. She pays the car insurance and the cell phone, but has no other income and does not help on the bills otherwise. To be honest, many of their problems stem from an odd idea that even though they are married and live in the same apartment that he’s going to do what he wants with his money and so she’s going to do what she wants with her money.

It’s weird because when my younger kids were ages that ranged from 2 to 7, they would sometimes get in fights over toys. Their arguments sounded oddly like many married couples I’ve heard fighting about money. When my kids fought over a toy, I took the toy away from all of them, regardless of who started the fight. They learned really quickly to settle their toy conflicts calmly and quietly. In the case of Genghis and his wife, they’re fighting over their toys (their transportation and home) and they’re about to have them taken away.

So why am I writing a blog feature about it? Here’s a quick list of reasons:

American Idol Isn’t On – I used to have a regular topic of discussion each Thursday, which was American Idol. As I wrote recently, I’m a little jealous of Nathan who has a rent home to renovate after a tenant gutted it, and so Nathan has a somewhat frequent topic to write about. Since Genghis has gutted his financial stability, I now have a little hobby.

I Don’t Know What Will Happen – This is as close to a reality show as I’ve ever been involved in. Even after spending a couple of days considering his problems and trying out a few leads to fix it, I can’t definitively say that his vehicle won’t get repossessed. I also can’t definitively say that he won’t be evicted. And even if he manages to not be evicted this month, I can’t definitively say he won’t be evicted next month, or that he’ll have electricity in his apartment. I can’t even definitively say that his wife, who is visiting her mom with the kids for the summer, will come home to this mess.

It’s Like a Game – Like I said above in the disclaimers, this is a pretty serious matter, but it is something that I can win or lose. And different levels of it exist. Maybe we can manage to sweet talk enough, and get close to enough money together while we’re at it, that they won’t evict him, they won’t take his vehicle, and they won’t cut off his electricity. But can I help him in such a way that I don’t ever have to loan him my own money? Can I help him through a full recovery? Can we do it before Christmas so his younger children still have a Santa Claus (not that I’m a fan of the whole Santa Claus thing). Can I help facilitate all of this where he loses as little money as possible to false interest?

If I’m Losing Sleep, I Better at Least Get a Blog Out of It – I don’t get much sleep lately anyway, and now I’m wasting time on someone else’s problem. I’ll lose sleep to do interesting things, but I do interesting things so that I have something to write about and here it is.

Illustration – I can rattle on all I want about my beliefs about what is bad money management and what is good, but using real life examples, and risking being proved wrong, definitely illustrates it in a way that theory can’t.

So each week, I will post between 800 and 1,200 words about our attempt to fix this whole mess. In my estimate, he will have to listen to me at least until the end of the year, so if he does, this will be a little over 20 episodes, and I should have a chance to cover a lot of theory and actual events. If he doesn’t listen to me, or tells me he can handle it himself, or ends up evicted, I guess it won’t be that many. So join me in the weeks to come as I discuss the last time he needed my help, my first mini-victory, and a number of mini-defeats.

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