First, let me state that I’m not entirely proud of what I’m about to say, but at the same time I hope that you’ll learn from what I’m about to say.
Early this morning, when I couldn’t stand to watch ESPN any longer due to the Tiger Woods “news,” I flipped to one of my free movie channels and started watching Confessions of a Shopaholic, staring Isla Fisher, the crazy sister in Wedding Crashers.
Anyway, Confessions centers around a woman, Rebecca Bloomwood, who as you’ve probably already guessed, is a shopaholic. She is in massive consumer debt and has a collection agency hounding her, and to make matters worse, she doles out advice consumers while writing for a financial magazine.
Ok, I’ll confess, I thought it was a cute movie and was worth watching purely for entertainment purposes (not to mention Isla Fisher is very nice to look at).
Despite the entertainment factor, I thought there were actually some pretty good financial lessons to be learned from the movie.
1) Know the differences between needs and wants. For those of you who are regular readers of The Personal Finance Program, you know this is something I talk about regularly, and is critically important to getting your finances in order.
In Confessions, Bloomwood is constantly buying new clothes and fashion accessories, despite having closets full of clothes, scarves, purses and shoes. Whenever she sees something she wants, she gets it, even though it’s certainly not something she needs. Over time, these purchases put her tens of thousands of dollars in credit card debt.
2) If you’re in consumer debt, you should make paying it down as quickly as possible a high priority. One of the things that gets Bloomwood into such a huge financial hole is doesn’t make paying down her debt a priority. While the movie never talks about what sort of interest rate she’s paying, we can assume that because she’s in deep credit card debt, the interest is at least 18%, if not more.
Over time, the interest continues to accrue, and eventually snowballs into such a giant number that it’s very hard to get out of.
Obviously, the best thing to do is avoid getting into this debt in the first place. If you weren’t able to avoid it, try your best to make more than the monthly minimum payments. This will allow you to pay off your debt much faster, and could ultimately save you thousands of dollars in interest costs.
3) Don’t delude yourself into thinking you don’t have a problem. The final thing that ends up hurting Bloomwood is the fact she refuses to admit that she has a serious problem. Instead of admitting her issues, she continues to avoid the debt collection agency all while continuing to spend money she doesn’t have on things she doesn’t need.
Had Bloomwood admitted her shopping and spending issues and put together a plan to pay off the debt, she would have been in a much better situation.
Just remember, lying to yourself won’t make your debt go away.
Anyway, if you’re looking for a cute movie that actually has some worthwhile advice, by all means, check out Confessions of a Shopaholic.
Can you think of any other movies that have good financial advice? Leave a comment below and share your thoughts.
Per the new FTC regulations, the above links are affiliate links (via Amazon.com), and should you purchase anything after clicking the above links, I will receive a small commission.
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