EVERY now and then, I encounter stories that make me shake my head and say…… What???
An 80-year old lady on a $10,000 annual social security pension getting mortgage for a $400,000 house. A caregiver and a security guard who had 3 houses at one point, 2 of which were rental properties but eventually were foreclosed. A retiring professional couple who still owes $900,000 on an expensive mortgage, plus 3 luxury cars still on financing. A nurse working 3 jobs to sustain a $1,700,000 house in a really nice area in Southern California, shared with her husband. A salesman earning minimum wage driving a BMW.
We run through these stories all too common today and it makes me wonder, have we, as a culture, learned our lesson from the disastrous stories of foreclosures and bankruptcies that is vigorously affecting our economy?
We live in a world of pretenses- nice homes, luxury cars, brand name clothes, shoes, and purses, lavish vacations, extravagant parties- albeit the source of these is credit, whether credit cards, mortgage or whatever it is that makes things easy to buy or get. We got so accustomed to spending money we don’t have.
I could empathize with people saying they want to elevate their quality of life...and who doesn’t want to? Isn’t it the American dream that we’ve all wanted to pursue, and leave our mother country for, is all about upgrading our economic well-being?
But it is inane and absurd to divulge in too many purchases based on assumptions of your future income or wealth. It is true that America is a country of opportunity and equality, but having a negative net worth (assets is less than liabilities) doesn’t mean you’re living the American dream, doing “better” than your parents did. Keeping up with the Joneses is not the epitome of American dream….. unless living with the Joneses still leaves you with a positive net worth.
Meanwhile, I will share a story I’ve personally witnessed and fonder as a good paradigm of economic responsibility.
Two Filipinas work alternately as private nurses to a Jewish lady (whom I’ll refer to as Client) in her late 80’s in a Westside neighborhood. Both are making $5,000 a month, living comfortably in their Mercedes and BMW, respectively. Client somehow owns an older model of Ford- nothing fancy and extravagant.
At some point, the nurses wonder if the Client could still afford to pay their combined salary of $10,000 a month. Yours truly asked what would be the basis for such doubt. One answered, “Because she’s driving an old car.” I simply said, “Don’t worry; she wouldn’t keep you if she couldn’t afford to pay you”.
They say there is no wrong question but, subjectively, that is the most irrational question I’ve heard. Had they known that the Client had more than 10 million dollars in just one investment account alone!
In most cases, the Jewish (no special favors here, just the fact that you encounter as you analyze the economic dynamic of Los Angeles alone); formula for economic success is based on accumulation of wealth (not debt), obtained honestly, and social responsibility.
I hope that remains our basis for success in our very own culture…others in us have taken that stride (kudos to those) but most us are still groping through the dark shadows of living large through credit- beyond our means.
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Evangeline is a California registered tax preparer, a legal document assistant for the general public, and a freelance paralegal offering assistance to various attorneys. She can be reached at her office at 2451 Colorado Blvd. #2, Eagle Rock, CA 90041 or at her marketing location inside the Eagle Rock Plaza. Her phone number is (323) 550-1869 or you can check her website at: www.evangelinegiron.net. She is a member of the court-endorsed California Association of Legal Document Assistant (CALDA) and an Associate Member (Non-attorney) of the LA County Bar Association (LACBA).
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Note: Evangeline is not an attorney nor does she provide legal advice. She is a bonded and registered Legal Document Assistant and prepares legal documents per the specific direction of clients.
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