Life & Financial Lessons From Being Broke

DollarsOf course no one likes to be broke. But sometimes financial struggles can help you learn more about yourself and how to better handle finances in the future.? interviewed several people who actually found that being broke had some upsides–believe it or not.

This is what Atlanta-based Bruce Ailion, realtor and attorney of RE/MAX Town and Country, discovered when he hit a rough patch following a divorce. ?Broke or poor is really a state of mind or being, as much as wealth is. Wealth without happiness and health is worthless. I meet many people considered poor, according to the government, who have a wealth of happiness and rich relationships, meaningful jobs and committed hobbies in spite of a lack of money. In my financial downturn, I was never poor or broke, I was without money. I always knew the money would come back,? Ailion says.

The downturn was a turning point for Ailion. This was also the case for Los Angeles-based Shara Koplowitz, a professional organizer at “O.P.E.N.,? who says, ?Being broke was the best thing that ever happened to me.? Koplowitz was a successful executive in Hollywood before she hit a rough patch. ?I made more money (in my field) than many of my peers and I never thought it would end.? It did. I went from making $300k to $0 within a year’s time. Looking back, it was the most important time in my life,? she says.

Koplowitz had a total lifestyle change. Like Koplowitz, Ailion had to seriously cut back on expenses–but realized that all the material things he and his family had earlier acquired weren?t all that important or necessary. ?I had a divorce that consumed virtually all of my assets. My kids and I left and moved from a country club home to an apartment, ? he says.

The situation hit Ailion?s children the hardest. ?Going from ?price doesn?t matter? to a budget that did not cover basics was a harsh reality for my children. I had been without money in the past. They were embarrassed I used coupons at supermarkets and restaurants. I cooked so much chicken at home that my daughter became a vegetarian and my son had to get used to wearing American Eagle instead of Abercrombie, but the idea of wearing Berkos instead of Birkenstocks was just too much,? Ailion says.

The hard times also taught Ailion’s kids an important lesson. ?As a result of the change in financial circumstance, my children learned to value money and are actually quite frugal today. As a result of the financial and emotional challenges, their psychologist told me they would grow up to be more resilient adults which is also true. It changed their character – and mine a little, too,? says Ailion.

The financially difficult period in Koplowitz?s life too made her re-evaluate. ?By having nothing, I was able to gain much-needed perspective and? understand the value of a dollar. It gave me the freedom to make major changes in my life that I would never have been able to make, had I continued to be reliant on a paycheck,? she says.? ?Being broke was the absolute worst time of my life, but I wouldn’t change a moment of it. It was the best life lesson I could have ever asked for.?

Graphic designer and artist Yuri Cataldo agrees. Cataldo, who founded IndigoH2O, an alkaline-rich mineral water bottling company, in 2011, went broke after a divorce and had to move in with his parents. ?Even though it felt shameful at the time, it is probably one of the best things that could have happened to me. It taught me about humility, self-reliance and reinvention. I also learned how to ask for help when it’s really needed. It has taken me a few years to build myself back up but now I know how to handle difficult financial situations with less fear because I have been there before and have come back,? he says.

The low point, surprisingly, gave Cataldo a chance to start over and refocus his career goals. ?I am now in a better position because of having to reinvent myself. Before, I was just a theater set and costume designer and that was all I thought I could do. After getting divorced, I started a company and found a way to connect being an artist with starting a company, which is a huge market now. I still do set and costume design work but in addition I am running a new program at Emerson College focused on helping artists combine their creative skills with business skills so that they can make it in the world. Also, I own the company that produced the best tasting water in the world,? Cataldo says.

Being broke also freed Cataldo to take more risks. ?Going broke before means I am less scared of taking risks and have even more confidence in myself. For that alone, it was worth it,? concludes Cataldo.