Recently I watched an episode of Big Spender about Joanie and Josh, a young married couple that's starting out on the wrong financial foot. Joanie's the definition of a spendthrift and has been dishonest with her husband about how much debt she's acquired. Larry Winget comes to rescue the couple with a plan to get them talking about their money and rid themselves of debt.
Joanie's mom has been doing everything she can to help the couple stay afloat, but in a way she has served as an enabler to their debt cycle. She gave her daughter a $30,000 loan — that Josh didn't know about — and has moved in to her own mother's home so that the couple could live in her apartment. They live there rent free and don't even pay utilities. If they were using the expense free life to build up their savings, that would be one thing, but they actually have no savings at all.
To find out how much Joanie has been spending at the mall just read more
Have you ever heard of a 26 year-old journalist organizing their closet by designer? Meet Joanie — after taking inventory of her closet it's evident that she has $600,000 worth of clothes and shoes! Larry says that her collection of clothes and shoes is the worst case of frivolous spending he's ever seen. That kind of money could have been used to purchase a home, but they can't even afford to live in the kind of apartments they'd like to rent.
Larry puts them on a "no excuses" budget that includes completely cutting Joanie's shopping habit, getting a joint checking account to prevent any money secrets, not eating out, and putting more money towards savings and debt repayment. They do a great job at following this budget and Joanie says that she feels much more free and not so guilty.
This episode made me think about the worth of my closet and my shopping habits. Could the value of the contents of your closet have been used to buy a home, like Joanie?