Fabulously Unrealistic

It has never ceased to amaze me how far women will go to be able to buy what they want, be it shoes, a copy of the latest Vogue or a new outfit for a hot date. Some women give up food and/or beverages, and others, just spiral further into debt. If faced between these two choices, I’d give up a Starbucks Venti Soy Chai Latte for a copy of InStyle instead of giving up my financial security, one page at a time.

In “Sex and the City”, Season 6, Episode 15 entitled “Catch-38”, Carrie’s talking to Charlotte about The Russian, and how he doesn’t want to have children, and it has made her have second thoughts about wanting children as well. This is where she muses about what she’s wanted in life, and how she’s gotten it, but yet she says she hasn’t felt that desire to have a baby, but is ultimately unsure whether or not inside of her heart, she feels that statement is true.

Carrie: “I wanted to be a writer, I made myself a writer. I want a ridiculously extravagant pair of shoes, I find a way to buy them.”

This statement resonates with many women out there, but are we really to blame for our out of control spending?

In recent years, there has been a disturbing rise of reports outlining people’s shopping habits, and what it’s doing to their credit. Metrics 2.0 cites that the Federal Reserve has reported Consumer Credit being at a record level of $2.35 trillion in July 2006. When comparing that to The Motley Fool’s stats in 2001 that the number used to be $1.7 trillion, that’s a $72.3% increase in consumer debt in the last 4 years yet 78% of U.S. households are deemed “credit worthy”, which leads to the reason why $8,562 is the average credit card debt carried by an American, which means 1.3 million credit card holders have declared bankruptcy in the last year. And this is just in the States. In Canada, the numbers are similar. CBC Marketplace reports the following:

There are 50.4 million credit cards out there, which is about 2 or more credit cards per Canadian, and out of that, 22.2 million carry a balance

I alone have 4 credit cards, but actively only use 3; I am as guilty as charged! I use one for business only (either corporate per diem meal and taxi expenses, and/or for my own business), along with an official corporate card that I use for travel and hotels which I’m not technically affected by, as the company is the main “personal” who pays the bills. And lastly, I use another for personal purchases only that I won’t get reimbursed for, and have full accountability on. The fourth unmentioned card is one I chopped up but never cancelled. You may wonder why I have 2 corporate/business cards. That’s because American Express only has a 1 month repayment grace period, and it has to be paid 100% in full. This is a problem because my expenses take at a minimum, 3-4 weeks to be returned to me, and even if I submit my expenses on time, I may miss that grace period, and end up paying money in interest charges, of no fault of my own. So unless it has anything to do with travel and lodging, I always use my Mastercard which gives me a 2 month grace period (plus I get points towards free groceries!).

Here are a couple more facts from CBC on Canadians:

Average Canadian household debt in 2004 through personal loans, lines of credit and mortgage debt: $69,450.00

Estimated household debt (mortgage and credit debt) owed by Canadians in 2003: $731 billion

Estimated household debt owed by Americans: $8.4 trillion

Estimated personal savings by Canadians: $9.39 billion

Estimated personal savings by Americans: $191 billion

Standard credit card interest rate (average): 18.9%

In Sex and the City, Carrie’s lifestyle is completely unrealistic, but yet when I watch it, I think “Wow.. I could do that”. The show hints slightly at the financial predicament she’s in, but never shows how it really plays out in real life. I haven’t personally experienced it, but I’ve definitely see the effects of it: the threatening creditor calls, the constant worry and stress, the shame when you go to the grocery store and your debit card or credit card is declined….again. It’s tough. And the show seems to glamourize Carrie’s lifestyle and showing a fantasy lifestyle that seems attainable because she touches lightly on the touch financial situations such as either buying her apartment with a down payment or be kicked out to another non-rent controlled apartment. The real rub for me, is that in the end, they gloss over the details, and her life seems like it works out in the end! I mean think about it – her down payment came from Charlotte’s huge Tiffany rock (about $40 grand); she married Mr. Big in the end who is a multimillionaire; her friend Amalita in the beginning buys her expensive Dolce & Gabbana shoes… this an obviously a farce. Sure, she has some fame from being a writer, but realistically speaking, it’s telling women that you can be financially irresponsible, blow a couple grand on Jimmy Choo shoes and end up dating politicians and other powerful movers and shakers, all on a piddly writers salary.

If I were in her position, I probably would’ve Ebay’d all my items (such as that ugly Laura Ashley dress circa 1990), and used that cash to build a portfolio for retirement. I mean, was she going to write forever? Or was she just waiting for some rich guy to come along and save her from her financial woes? This is what women are internalizing and fooling themselves into thinking that their future husband will take care of it all. Well what happens if you divorce? Or if your husband dies accidentally without life insurance? You’ll be left with no retirement plan and no way of taking care of yourself – a penniless divorcee or widow.

All I’m saying is that retail therapy is fine once in a while, and in fact, quite healthy if you don’t go overboard and blow a couple grand (or a month’s rent) on a pair of shoes when you know you can’t afford it. This goes for the upcoming holidays too! This time of the year should be all about getting together, not trying to outspend each other on getting fabulous gifts. If you know you can somewhat afford it, and it won’t make you miss your rent/mortgage payment/bills, then by all means, treat yourself but don’t make it a regular occurrence or a crutch for things that go wrong in your life. Lastly, for a brief moment before you pass over your plastic, consider if having a pair of skyscraping sexy lace-covered Christian Louboutin heels measures up to having a sense of financial security when you retire.

P.S. I’ll think of some shopping tips that I utilize before going out to the stores, and post them next time.

Related Posts:

• What would you do with your old credit cards?
• The Alternative to Cash & Credit or Debit Cards
• Answer to Gail’s Polly Riddle
• Finding the money to do what you want (from a "Sex and the City" perspective)
• 5 Finance Basics

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