Long Story $hort Episode 3

Moving from Passivity to Action to Overcome Debt

Jim Kline funded a lot of his 20s with credit cards. When he entered his 30s, the combination of credit card payments and student loans overwhelmed him and he knew he needed to make a change. With the help of his partner, family, friends, and the counselors at MMI, Jim worked diligently to create a budget that worked for his lifestyle and educated himself on how to overcome his debt.

Today Jim advocates for being active, not passive, with your personal finance.

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Show Notes

  • Guest: Jim Kline
  • Host: Adam Walker
  • Publication Date: June 21, 2022

Episode Transcript

[00:00:00] Jim Kline: It was a good eye-opening experience at the beginning that I did need help. I also needed to educate myself. I couldn't just continue to kick the can down the road or be a passive person with my finances.

[00:00:17] Adam Walker: Debt. We've all heard of it. Most of us have it. Debt is an almost unavoidable reality of life. But what happens when it starts consuming life? The experts at Money Management International believe that financial challenges aren't meant to be faced alone.

On this podcast, we hear stories of people whose lives have been changed by MMI’s role as their toughest coach and loudest cheerleader. Their stories are unique, personal, and inspiring. So stay tuned, because we're sharing each guest’s Long Story Short.

Today on the show. I'm talking with Jim Kline. Jim currently lives in Washington, DC. While working with the debt relief counselors at MMI, he paid off $40,000 in three years. Here to share his story and more about his experience working with Money Management International is Jim Kline. Jim, welcome to Long Story Short.

[00:01:26] Jim Kline: Thank you. Thank you. It's great to be here. Thanks for inviting me.

[00:01:28] Adam Walker: I'm so happy to talk to you and these numbers are just killer. You know I would imagine it's just so daunting to start. But you did it in three years, which is amazing. But let's start with you first. Tell us about yourself. Who are you? What do you do? What do your days look like?

[00:01:44] Jim Kline: Yeah of course. Hi everyone. Jim Kline, I am from New Jersey but live in Washington, DC now, and I'm 36. So I'm creeping up there in, in the years. I feel it more and more. I I wake up now in the morning and I'll like, have a sleep injury. I'm like, how did they like get my neck?

So you know, other than aging gracefully married. And I got married over the pandemic and live with my husband and my three-year-old French bulldog. And that's pretty much my life. I work at an education nonprofit here in Washington, DC and get to work really closely with schools and school leaders.

And yeah, former teacher. So I'm always a teacher at heart. I'll never shed that aspect of my identity.

[00:02:33] Adam Walker: I love that I'll and you should not shed that aspect. It's so important to who you are and to what you do. And also, you know, I feel like we could have a whole podcast just about sleep injuries. But that's a, that's another show for another time.

So we'll move on. We'll move on from there. So let's talk about your debt story. Walk us through, you know, what was your debt? What was your debt story? What was happening in your life when you decided to work with MMI? And was there any particular breaking point that you hit where you knew you needed that outside help?

[00:03:02] Jim Kline: Yeah, a few breaking points. I think the story starts with the prelude. My childhood, I grew up with two amazing parents but blue-collar workers. And my dad, I know, worked many jobs and my parents struggled with debt significantly. They were constantly, I just remember as a kid, going to the toy store and be like, can I have this?

And they're like, whoa put it on the credit card. And I watched my parents argue over debt and really struggle with financing their lives. I think that my early relationship with money was a lot of negative, mixed emotions. I wanted things as a kid. I also saw my parents really struggle and argue.

And my dad actually went through a debt management plan when I was in high school. And I remember that process of cutting the cards up and really having to, as a family of four, a really trim down in the household and get on the right track. And I remember being so proud of him and my mom.

And so that was my first sort of engagement with what asking for help was. And then I went to college. Went to a state school. And just those lessons from my parents came to me. I put a lot of stuff on credit cards. I, a lot of books, a lot of you know, going to the bars and getting drinks.

And I put even towards the end of my college years put a half a semester of tuition on a credit card just to make it. And so I early on in my twenties really established some pretty bad habits around credit cards, specifically. Before student loans even became a part of my life. When those payments started to hit. I moved to New Orleans and became a teacher right at the beginning of the Great Recession in 2008.

And so what a time. I was lucky to have a job and doing what I loved as a teacher. But also teachers you know, the story, especially first-year teachers and second-year teachers, they don't make a lot of money. And so I put also a lot of money on credit cards. To make sure I was able to live a life. And you know, whether it was lifestyle creep after, after college or whether it was low salary and just expenses are tough.

I put just a lot of money on the credit card. And so just over the years being a teacher and you know your wages are pretty stagnant over the years. And just more and more was being relied on through credit. And then student loans were hitting and long story short my twenties just went by really quickly and I had a lot of amazing memories a few relationships that, you know, trip here, a trip there you know let's go out to dinner. Can we afford it?

Just I felt like I woke up one day in my thirties, my early thirties and just saw a lot of credit card debt that was now becoming so increasingly hard to keep up with it. A lot, most of my cash, my free cash is going to paying down my credit cards. And the minimum payments were becoming really increasingly difficult to keep up with. And the breaking point that you mentioned, there were a few, but I moved to Washington DC from New Orleans and started dating my now-husband.

We were out with a few friends and we were going to this party and the casino and you needed to cover to get in. And it was a $20 cover, so I went to the ATM and there was no cash in there. And I remember turning to my group of friends, Like actually, could someone spot me? My card isn't working.

And I did not have a conversation with my now husband early on about my financial situation, my debt, my student loans. And that was a really important moment of feeling really embarrassed. But also. I need to let my partner in. I need to let my friends into this, the struggle. I can't continue to hide and cover it up with more and more credit cards.

And so at that moment I went home, we had a really good conversation. And he said, what can we do? Like what would help us out there? I was like, Oh, I remember my dad did this program. I don't know if bankruptcy is story here, possibly. Let me just call someone. And I knew I wanted to call a non-profit, an organization that wasn't trying to sell me anything, someone with good reviews, and I just thankfully stumbled on MMI.

[00:07:32] Adam Walker: Wow. That's amazing. I mean, and it sounds like I can, I, can, I appreciate you just painting the picture there, you know, I can imagine you're standing at that ATM and having that sinking moment of, Oh man.

And it just kind of all crashes at once. Right. But then you have to turn around to your friends and pretend that it didn't. And I just, that really struck me. So I just appreciate you sharing that. And so, so you started working with MMI. Let's talk about that. So you started working with MMI.

You've now paid off $40,000. Let me just say that again, $40,000 in three years, which is just profound. Talk about some of the challenges you faced along the way and what were some of the lessons that you learned in that process?

[00:08:17] Jim Kline: Yeah, I think financial education is not something, I shared about my parents, and I myself as a teacher, I love education.

I taught high school. We just don't teach this in schools. We don't teach budgeting. We don't teach credit scores. We don't teach, you know the game of life. And I I was a, you know, at the start of my my my work with Money Management International, my debt management plan I didn't know much about the financial system or budgeting.

I didn't have a budgeting system. I didn't know what worked for me. And so at the beginning it was really challenging. I remember working with a counselor and going through and like the counselor asking really great questions, like what were my utilities and expenses and put it all on a spreadsheet.

Figuring out how much, you know, available cash I did have. And what was I contributing to my 401k? And I was really it was a good eye-opening experience at the beginning that did need help. I also needed to educate myself. I couldn't just continue to kick the can down the road or be a passive a passive person with my finances.

It was really beginning to impact my mental health, and my relationships, and my friendships. And so I think first was just understanding I needed that education. I needed to, as a teacher I needed to teach myself some things. So that was one challenge that I needed to overcome was just, what did I not know?

How do I get that information? The second was lifestyle creep, you know, it's fine to live in your twenties you know, shoestring. You know you, especially at the point in my life, when I was going through this process in my early thirties, I really wanted to have a car in Washington, DC, I wanted to have a nice place.

I didn't want to, you know, continue to live in homes that I didn't feel like were mine. I wanted eventually to own my own home. So the challenge of lifestyle creep you know, as soon as I got a little bit of breathing room, not going and spending all that money, but putting that money again towards additional payments on by debt management plan.

And making those right decisions. So I think that was a second challenge of just making sure I avoided the, you know, let's get a nicer car or let's, you know, upgrade apartments, or let's go clothing shopping and let's go out to dinner, a vacation. And those things are important and I did some of those things and you still have to, you have to make it work with your budget. But that was a really important lesson.

And then just cashflow, understanding, I think, this could be a whole, maybe less, less interesting podcast topic. But just understanding where my cash is going in and out automating things, creating buckets, knowing. You know a lot of my problems were just based on cashflow and not planning and then putting it on credit cards.

So those were continuous challenges. Just especially cause you don't have credit cards, you cut them up. You have to promise not to use a credit card or any of your lines of credit with your debt management plan. So relying on a debit card, having to get really disciplined about budgeting, what's coming in and out, when are my pay days, when are my bills hitting. Those were all things that were challenges that I had to work through.

[00:11:32] Adam Walker: Wow, so you made a comment in there. You said you couldn't be passive with your finances anymore. And I wonder if we could just unpack that for a moment. Because it occurs to me that when we don't have financial education in our homes as children, that we really don't know how to manage money and sort of money, we're sort of for lack of a better term, willy nilly about.

We're kind of passive. We don't really think about it. Right. It's just, oh I want that pair of pants. Let me buy it. I want this, let me buy it. Let me, you know, whatever, and we just don't consider the long-term impact. So, so what do you? Like, so I guess, what do you think the impact of being passive with your finances is? And then how did that mindset shift affect how you moved forward?

[00:12:17] Jim Kline: Yeah, I think the outcome of being passive is where I, and so many other people. Are just debt it's being. You know, there was I have some issues with with the book, but the book Rich Dad, Poor Dad was one of the first books that I read. And you know, putting some of the politics aside.

I think he talks about paying yourself first. And this concept of you know, you, you still need to pay your bills, but this idea of investing in yourself, investing in your financial education, is not is not something that we should look down on or like it's not icky or like I think I viewed myself.

I am an educator. I I'm very much someone who doesn't want to talk a lot about money and I want to talk about social impact and I want to talk about the work that we do, and children, and families, and communities. And so I think for me being passive. I was like, well, this isn't a huge, like, I don't work in finance.

I'm not on Wall Street. I'm not in this world of finance. So I don't really need to know all of this information. And the reality was I got myself into a pickle because of that. And it wasn't just going to work itself out. Like I needed to be the driver of it. And so being more passive, I think let a lot of years of wasted opportunity go by.

And I'm glad that I did get the help when I did. Because if I waited until I was 40, or 45, or 50 or retirement age, then I wouldn't have been able to make that shift in my life.

[00:13:53] Adam Walker: Right. Yeah. I mean, in the mountain would have been just so unimaginably high at that point. Right. So. All right. So it's June. It's Pride Month. I understand that you identify as gay and you mentioned your husband. So congratulations on getting married, by the way. And I'm curious what your take is on how debt and financial issues affect the LGBTQ plus community.

[00:14:17] Jim Kline: Yeah, I mean I certainly can't speak for the whole community and happy Pride. But I think for me just there, there's a lot of stigma. There's there's a lot of marginalization of our community and there's a lot of living in the shadows or chasing something. Chasing happiness, chasing a lifestyle that that I know I've struggled with. And there's also a sense of pride quote unquote, that we have.

We want to be the best version of ourselves. For so long, we I grew up like repressing a huge part of who I was and who I am. And I think the lifestyle, like I wanted to deserve that. Like, I deserve this thing that I'm gonna put on my credit card. Or I want to feel good about you know, I had a bad dating breakup and I want to go to Puerto Rico and lay on the beach for a few days and I deserve this.

And while that was true I made some bad decisions. And I sort of I lumped that into just my own sense of self and how I viewed myself. And so I know our community, the queer community, I mean homelessness affects us more.

We, the student loan crisis, you know, that I still am paying actively down my student loans. But I know this hits us differently. So I think the one we shouldn't be afraid to talk about it. And I think we shouldn't be afraid to ask for help. And I know everyone's, situation's a little bit different.

I think we're community that celebrates each other and celebrates all the differences within our community. And really allows allows the community to flourish together. And I think for me opening up, asking for help talking to my friends about it, getting resources and sharing best practices.

I think that's the beauty of our community. And that's what I learned in opening up to my friends and my family and people in my community. I think for me it's been very personal. It's been hard to open up. And so I, I don't think it's, you know, I think it would be simple to say like, oh, we all have this lifestyle.

We want to keep up in. That means that, you know, financial hardship hits us differently, but I don't necessarily know if it hits all of us differently. But I think the stigma is there. And I think for so many of us who were struggling with our identity as I, when I was coming out was, and so many of us are struggling with other aspects of our life.

It's so easy to just not to be that passive person to put things on the credit card or to not learn about this aspect of our lives and finance. Yeah. Well.

[00:17:00] Adam Walker: and it occurs to me as you're talking about that. I mean, you said, you know, as you were struggling with your identity and as you're struggling to express.

With the people you love in your life, you probably don't want to talk about something else that also has a stigma, which is debt. Right. So it's almost, it feels to me like for the queer community, this would almost be doubly hard. I mean does that feel accurate to you?

[00:17:25] Jim Kline: Yeah, I think, you know I know a lot of folks in the queer community who are very financially solid and I know a lot of.

A lot of my friends who are new parents in the queer community, or are facing things that, you know straight folks and have experienced for years re childcare costs and educational costs and the more your family grows. So I, I. There's a lot of nuance and there's a lot of there's a lot of complexity that our community, but I think I couldn't agree more that just double stigma is usually assigned for repression.

And I can only speak for my myself here. I just know when I was in a new relationship or when I was going through really hard times at work or with. I moved to a new city. It's just, it's so easy to put your financial health on the back burner. And thinking of it as separate or other, but your financial health impacts your mental health that impacts your physical health.

My ability to have the, you know the flexible space to, to, you know, can I join a gym? Could I like put money towards. Like doing XYZ, like going on a vacation for my mental health. Having that available money is really important. I think it's really important to our community.

Just given the stressors, given the struggles that we have and so I think that it's very much important for our community to have these resources as well as other communities.

[00:19:01] Adam Walker: Yeah, totally agree. I totally agree. So, so Jim. Last question for you. What does freedom from debt look like for you?

[00:19:11] Jim Kline: Yeah, I think it is one of the it. My partner and I, when we had that talk we color-coded it. And it was, you know, are you red? Are you green? Are you or are you yellow? And when I was in the red, it was like, this is deeply stressful. I'm walking around, like anything could trigger me.

I'm going to go off on someone. If they asked me if I want like coffee or creamer in my coffee, like, red I'm on edge. And he was such an amazing partner in that because he would ask me all the time, like, know, where you at? Red? Or yellow? Or green? Like is the budget is working this month? Maybe I got a little bit more cash from a project and I was able to put that aside and that was a buffer.

So for me, just having that freedom from credit card allowed me to not be in the red and still, you know, student loans and there's other bills and at times, you know we're all on this journey, there's no like, magical, like, and then you're free.

And then, you know, there's never any more financial obstacles there. There are definitely still obstacles in my life that I'm working through. But I have the tools. I also, I think most importantly, I had the confidence and the belief that I can do it because $40,000 is a lot and you're looking at it and you're like, I'm never going to pay this down, but with the MMI's program with automating it with the resources, with the counseling and then your personal conviction.

Yep. I'm gonna, I'm gonna listen to more podcasts. I'm gonna read more books. I'm going to discipline myself to, to budget more. That for me, that means I'm in the red less. And then the green more I know when I'm in the orange or the yellow zone. I can actually, I know what to do. I have a coping mechanism and I also know like deep breaths.

I can do this when it gets tough and also to celebrate what did I have that buffer money. When I have that emergency savings fund. When I'm contributing more to my 401k. I know I'm helping that future Jim .You know, in 10 years if I'm on this podcast again, like I, I wonder what I'm going to be able to accomplish now and who I can help and how I can transform my life because of the things that I did with MMI.

[00:21:19] Adam Walker: Well, Jim you are, you're certainly a teacher at heart, and I really appreciate that. I appreciate you sharing your story with us. And man, I just appreciate the fact that you were able to overcome so much in honestly, such a profoundly short amount of time. So congratulations to you and thank you for joining us on the show today.

[00:21:37] Jim Kline: Thanks so good to be here.

[00:21:45] Adam Walker: This guest is a real MMI client whose success is the result of hard work and dedication. While MMI cannot guarantee results, taking early action can increase the available options and improve long-term outcomes. Thanks for listening to this episode of Long Story Short, brought to you by Money Management International.

To learn more about how MMI helps people from all walks of life get unstuck and out of the vicious cycle of debt through personalized solutions that inspire hope, visit moneymanagement.org. This episode was produced by Edgewise Media. Scriptwriting and production by Clara Jennings, editing by Brandon Ellis, and show hosting by me, Adam Walker.

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