I Made $50,000 Then It Was Like I Was Blackout Drunk
By: Rocco Pendola
Tags: Money, Personal Finance, Budget, Self, Saving

I Made $50,000 Then It Was Like I Was Blackout Drunk

Photo by Anthony Tran on Unsplash

Read this even if you already have $50,000 saved. If you don’t, think about how long it might take you to accumulate $50,000 via straight saving, as in nothing but meager big bank interest. Then consider what you’d do with it.

I picked $50,000 for a reason. It’s not super precise, but it’s not arbitrary either. In 2012, I made $50,000 over two months as a freelance writer. It’s the most money I’ve ever made writing in such a short duration. For reference, I link to the article where I chronicle my lifetime earnings at the end of the present article.

Anyhow, I earned considerable money in 2012. It’s also when I made some of my dumbest and most damaging money mistakes. You could call 2012 a lapse. Or a relapse. I had already gotten most of my poor personal financial decisions out of the way between 1995 and 2005. Suddenly, I had all of this money coming in, and, quite honestly, I wasn’t prepared. I turned into a deer in the headlights.

Here’s the thing about that two-month period and its out-sized cash flow. I have no idea where a dime of that money went. That’s pretty scary.

It’s akin to getting blackout drunk with no recollection of what you did last night or with who. (By the way, check out The Flight Attendant on HBO Max. It’s good). You try to piece together what happened, but your mind can’t go there. It’s clouded with an emotional cocktail that stunts memory and blocks rational thought.

I know a fair bit about personal finance and investing. I knew a fair bit in 2012. Even still, when I had all of this cash, I probably needed to allocate in different directions, I had no idea what to do. I was truly frozen.

My first mistake was practical. I had no plan. At least not a comprehensive plan like I do today. If you handed me $50,000 right now, I know pretty much exactly what I’d do with it. This is the dream. This is where we should all strive to end up and sustain.

Today, I’d look through my various savings accounts. I’d beef up my emergency fund. I’d add the equivalent of a flat tire to my rainy day fund. I’d distribute a few hundred bucks to my temporary retirement and “go back and get my Ph.D.” funds. I’d direct several thousand bucks to my dividend stock portfolio. I’d give some money to my daughter. I’d hold several thousand back to cover the next few months worth of fixed expenses.

In other words, I’d have a clue and a plan to methodically follow. I wouldn’t have to think in the moment because I’d have done all the thinking and figuring out prior to generating cash flow that requires thought to allocate. I’d be on personal financial autopilot with the ability to adjust on the fly.

More than anything, I’d know myself better. I would have developed the financial self-awareness necessary to handle almost any amount of money without thinking, let alone stressing. Sort of like knowing the exact amount of state-altering substances you can consume to not blackout yet still have a damn good time.

How do you get there? I suggest two things:

Consume a ton of personal finance content. Read authors who share experiences rather than dogmatic prescriptions. Assess their thoughts, ideas, and strategies. Learn what works for you by… Going to therapy. Yep. Don’t even mention money to your therapist. Get into failed relationships or friendships. Talk about why you drink too much. Ask for help figuring out why you can’t be alone. Inquire about why it’s so difficult for you to be with someone else. Go wherever you feel discomfort. Explore it. Figure your shit out. Become more self-aware.

This is merely my experience. Not a dogmatic prescription. It just worked for me.

But here’s the thing — I didn’t set out on this path because I knew it was going to work. I didn’t know therapy would help me situate myself psychologically and subsequently make me better with money. I didn’t see the connection between general self-awareness and financial self-awareness. Getting better with money ended up a welcome, unintended consequence of going to therapy for something else entirely.

When you stop and think about it — with the benefit of hindsight — it makes a ton of sense. There’s got to be something going on psycho-emotionally, something that lives beyond practical money matters, that drives a person to take in $50,000 and, beyond paying rent and such, end up with absolutely no idea where it went.

We play this hypothetical game all the time. What would you do with X amount of money? If you jump to rattling off all the ways you’d spend it, take that as a red flag. If you know, it’d bad form to discretionary spend it, but you don’t know what else to do with it, consider this a warning sign.

Bottom line — if you don’t have a strategy to thoughtfully spread your windfall across, you gotta figure things out.

While part of this, figuring out process involves learning more about personal finance and investing, learning more about yourself probably ought to come first.