Sunday, March 11, 2018
Lee Pitts: The Bankruptcy Book
We've all heard of Chapter 11 and millions of folks have lived through chapters seven and 13, but where is this bankruptcy book where these chapters come from? From what I can tell, no one has ever read the entire tome. I know when I asked for it at our local library they looked at me like I was a few fries short of a Happy Meal, or one taco short of a combo plate.
Here, for the first time, are some of the missing chapters from The Bankruptcy Book explaining many of the ways you too can go broke:
Chapter One: Bike Broke- As a kid I mowed lawns at fifty cents a whack, picked fruit and dusted furniture in my Grandpa's furniture store (the worst job I ever had) all so I could buy a Schwinn Continental 10 speed bike. I knew I needed to save up $64 to buy one but by the time I'd acquired that much cash that model was now $79. This was my first experience with how the ravages of inflation can break you. I had to settle for a Schwinn Varsity which only had eight speeds. This was like getting a letter in high school for playing on the golf team or marching in the band, while all the girls were interested in were guys who got their letter playing football.
Chapter Two: Scrambling Your Nest-Egg- The easiest way to go broke is to get divorced every ten years and keep giving half of everything you own to someone you don't like who wants custody of all the cash.
Chapter Three: "Never a lender or borrower be." After the photo of me and my first Grand Champion Steer appeared on the front page of our local daily newspaper my status in high school immediately went from "that farmer kid" to "most popular rich kid on campus." Kids with cars were hitting me up for loans for gas money while I was still getting around town on my Varsity eight speed. By the time I'd sold my second Grand Champion I was making more money per year than my father, and my mom regularly used me like an ATM. I learned the hard way that you should never loan money to friends, strangers, or relatives. The moral to this story is the closer one is related to you, the less chance you'll ever have of ever seeing your money again.
Chapter Five: House Broke (Not the dog variety)- This is going to be hard to believe for everyone under 50 but the interest rate for our first house was 10%. Conventional wisdom at the time said it was better to keep paying this exorbitant rate than to pay off your house because you got to deduct the interest on your taxes. Such thinking drove many into the poor house.