Lessons from 2008

Coin stack and saving money
KJ: While I’ve always been a saver, I’m not sure where I would be if it weren’t for 2008. The events that unfolded and the experiences I gained were astronomical, but the bottom line of it all was: inappropriate debt causes insurmountable problems. It’s with this perspective that my aggressive saving really was able to kick-off into the position that my wife and I are in today.

With limited money invested since I was only truly beginning to ramp up my savings, the impact of the colossal crash taught me that all walks of life: extremely wealthy (however you may personally define that if it’s a net worth of $500,000, $10,000,000 or $100,000,000), middle income, and lower income alike were devastated by too much debt. I learned very valuable lessons to live not just within our means, but beneath our means. The Great Recession served – for better or for worse – to really test me on the difference between a ‘want’ and ‘need.’ Sure I need an expensive car, fancy clothes, and a mansion, but I really want food today. Maybe I’ll just get the car. Food isn’t really that important. Wait what?

While my wife and I do partake in our share of what may be considered extravagant meals and trips, we assess our current state each month (more realistically, multiple times a month) to make sure we are on track, saving appropriately, and aggressively cutting expenses when we need (or want) to. Long day at work, craving for all you can eat beef at Texas De Brazil: I think I am willing to eat peanut butter and jelly sandwiches for a week to make-do. Everyone has expenses that are particularly meaningful to them, and for me it’s vacations and food experiences. Whatever sacrifices I need to make in clothing, auto expenses, or finding creative, budget conscious choices for lunches (soups, leftovers), I find a solution to accomplish my needs and the most important wants, so I can save for a rainy day deductible or job interruption and not amass high interest debt in a time of crisis.

AJ: 2008 for me was really just the beginning of our lives together, and it was a really big year for us. We both graduated from college, moved back home, started our first “real jobs,” and purchased our first home together. I’m incredibly thankful for the fear that filled both of us as we thoughtfully made all of those decisions with the overwhelming coverage of what was about to happen to our economy. Of the two of us, I’m certainly the more extravagant, but I’m also the most motivated by a seemingly insurmountable challenge. If Kirby decided tomorrow that he really wanted a Rolex (this is both highly unlikely and comedic, given Kirby’s preference for oversized athletic pants and hoodies when lounging around on the weekends – a throwback to his high school days), I would work diligently to make that happen. 2008 for us meant agreeing to put our future before anything we may decide we want or need in the immediate present. I know there was a lot of destruction in the years following 2008, but for a generation that was given so much from a very young age, I’m thankful for the perspective and for what it might mean for us all to be more practical and more logical.

    What did you learn from 2008?
    If you had it to do over again, what would you change?

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4 thoughts on “Lessons from 2008

  1. I greatly enjoyed the post above. I Thank You both for sharing your experiences. It’s so nice to learn from others. 2008 taught us many lessons. I too believe it was a wake-up call to review how we live and what is truly important to us. Keeping things simple and focusing on what really matters, helps us in our day-to-day financial decision making! Thanks again!

    • Yeah, one of the takeaways from the events around 2008 is that it is important to reflect on what is most meaningful to us. In some cases, it can be an exercise to cut out excess, and in other ways, it can teach us to spend more intelligently.

  2. Good stuff. I would also say that being retired in 2008, it taught me that nothing is forever, you can never have too much in savings and when an event that is life changing happens, you have to change the way you live, stop spending keep saving.

    • Very good point. When something life changing happens, you have to sit down and think about the potential impact, so you can make appropriate changes going forward. That is why it is so important to regularly review your finances, so you can know if anything needs to be changed or updated since the world around us changes so quickly too!

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