September 23, 2003 by Michelle Singletary
Transcript with Michelle Singletary, Post Business Columnist, and Karyn Bosnak, Author
This is one online discussion you won't want to miss. What would you do if you had $20,000 in credit card debt? Panic? Phone a friend for a loan or ask strangers to bail you out?
Author Karyn Bosnak asked total strangers to send her cash to help her get out of credit card debt. And it worked. She raised more than $13,000 by setting up a web site on which she begged for money. She is now debt-free and the author of this month's Color of Money Book Club selection, Save Karyn: One Shopaholic's Journey to Debt and Back. Whether you agree with how Bosnak got out of debt her account of how she got into debt is fascinating. Join personal finance columnist Michelle Singletary and Bosnak on Wednesday, Sept. 24 at 1 p.m. ET to discuss her book, Save Karyn: One Shopaholic's Journey to Debt and Back.
The transcript follows.
Editor's Note: Washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.
Michelle Singletary: Welcome folks. I have to say I couldn't wait for this online discussion. I received a ton of mail about why I chose this book. It was a risk but one I'm still happy I made. It's began a great debate about debt and how you get out of it. So, let's get started.
Michelle Singletary: To start, tell me what made you decide to write the book? What was your work history and how did you get so deep in debt?
Karyn Bosnak: First of all, I love to write, so I was excited at the idea of writing a book, and delighted when the opportunity to do so presented itself to me. Second, I thought the story of what happened was both funny, hopefully inspirational, and received so many emails from people asking about the full story of what happened, that I wanted to share it with others.
Takoma Park, MD: What advice would you give to people who do not want to get into debt in the first place?
Karyn Bosnak: Self-control, self-control, self-control. My problem was due to a complete lack of self-control and the thinking that I would always have a job that paid great money, that the economy would always be good, and the thinking that if the economy was bad, it wouldn't affect my income or job security.
Washington, DC: Um, wasn't it your fault that you got into debt in the first place? With all of the non-profits who need money these days, I can't believe someone gave you money to pay off your credit card debt.
If I were you, I would be embarassed!! How can you sleep at night when you aren't responsible for your actions. Maybe it is time for you to grow up!
Karyn Bosnak: I'm not emabarassed about creating a website topay off my debt It was not a one page plea asking people to give me money. It was a lot of pages that I put hours of work into each night that honestly entertained people. Most of the money I received cam with notes that said, "I expected to go to your website and hate you, but you have kept me entertained for the last hour, and that's worth a couple of bucks to me." I think I was proactive in getting rid of my debt.
I was, however, and still am a bit embarrassed about the debt. I agree that it completely my fault. But I could beat myself up over it, and wallow in self-pity, or do something to fix it. I fixed it.
Michelle Singletary: Can you elaborate on how you ended up with $20,000 in credit card debt? Did you have a good paying television job? Why couldn't you pay the debts?
Karyn Bosnak: I moved to New York in May 2000 from Chicago. When I moved here, I landed a good job a television producer, and was making about $75,000 a year. My rent was about $1,800/month, and about 40% of my check went to taxes. So beleive it or not, my take home pay was not amazing.
Chicago is a big city, yes, but New York is enormous. I charged up $20,000 in clothes and stuff because I think I felt a bit "midwestern" if you will, and a bit out of my element. I was also a new producer and a bit naive. I think I bought the stuff because "looking like one of them" if you will have me an extra boost of confidence that I needed.
Michelle Singletary: In your book, before your self revelation that buying the way you did was wrong, you talked a lot about how important it was too look good? Do you still feel that what you wear is important (even if you get it on discount)? Oh, and why oh why did you spend that $750 for a blind date? It was a "blind" date which means he has never seen anything you have in your wardrobe.
Karyn Bosnak: Yes, my father yelled at me for that one after he read it... Like I said, going back and assessing the way I felt when I bought things... It made me feel like I belonged in this city. It was kind of like "keeping up with the joneses."
Michelle Singletary: Why do you think so many people (wasn't it more than 2,000) sent you money? I agree with many readers. I was just amazed. I mean you seem nice enough but I wouldn't have sent you a penny.
Karyn Bosnak: I think when people initially heard of the website they were like, "Huh? We all have debt. Who does this chick think she is?" But then they went to my website and honestly, got a chuckle out of the things I was writing and doing. I volunteered for a PMS study. I switched from bttled water to Brita water (gasp!). It was so tongue in cheek and simply outrageous at times, that people gave me money because they admired my honestly about how I got into the debt in the first place, and laughed at the changes I was making in my life. I think that people - if even in a small way - related to the things I was doing. We've all brought our lunch to work when the wallet is tight. We've all (maybe?) had to wash our clothes in the tub. We have all had to make our coffee at home. Maybe... but you know what I mean.
Severn, MD: Good afternoon, Karyn. Thanks in advance for taking my question.
Besides becoming deep in debt again, what would you say has been the driving factor(s)that has kept you from "reviving" your past spending habits? Also, what spending habit(s)have been the hardest to break?
Karyn Bosnak: Well, I "removed" my self from Manhattan - which really is one big shopping mall. I live in Brooklyn and work from home. If I were to go back, move back, or work back in Manhattan, would I spend myself inot a tizzy again? Hopefully not. But it's too soon and I don;t trust myself enough to find out. Maybe I have a problem. Maybe I need help. Maybe I will look into it. But I will not go back. not yet.
Springfield, VA: I actually did come back from being $18,000 in CC debt, and paid it all off over a two year period through a lot of discipline, hard work, and sacrifice. Is the difference between the two of us that you see yourself as a writer, and therefore were self-employed being paid to write your website?
Karyn Bosnak: Yes. Kind of. I was not happy in televison, and wanted to change careers. And the funny thing was thta I didn't know that I enjoyed writing so much until I put up this silly website. And people really started to respond to what I was writing and what I was saying. It became a really rewarding experience for me, because I started to receive emails from people who I made laugh, cry, etc. I felt like I was finally "doing something." I finally felt rewarded in that way.
Contrary to popular belief, I WORKED for the money I received. I worked at updating my website, answrring emails, making people laugh. I would work my regular job from 9am to 9pm, and then come home and update until 2 in the morning sometimes. If I had not done that, if my website was a one page plea, I would not have received the money I did.
Michelle Singletary: I still have to know because what you did is so foreign to me. What was going on in your mind each time you plunked down that charge card knowing full well that you were broke? I just can't relate. Help me see what you were thinking. And more important is there anything you can say that others might do to prevent them from doing what you did? As they are shopping or before they head out to shop what would you advise a shopaholic to do? Maybe hearing it from one of their own might help.
Karyn Bosnak: The more that time passes and I'm able to look back at that time, yes I too am shocked at my lack of self-control. But I also try to think more about why I really bought the things. I will absolutely admit that looking good, fashionable, hip made me feel better about myself. I think a lot of people who compulsively buy things get that same sort of reward from it. But in regards to the spending and the charging, I honestly believed every single time I charged somehting, that I would not charge again, and would pay off the debt. It was a "Just this one last pair of shoes" thinking. AND, I saw my career path in front of me. I was making $75,000 a year, I got a new job in June 2001 and my salary went up to $100,000 a year. I saw myself getting promotions, and raises. I didn't see myself losing my job.
NY, NY: Rock on Karyn! Debt happens, it's like an avalanche -- bit by bit and one day you're COVERED and you made lemonade out of your lemons. Way to go!
(a less creative fellow debtor, climbing out of the crevasse)
Michelle Singletary: Interesting. So NY how did debt happen to you? And I'm not so sure anymore that debt just "happens." It's not like it's a dog running loose in your neighbor and bites you on the ass. You have to decide to whip out your credit card and get biten by the debt dog.
Karyn Bosnak: I think what she means is that some people have to learn by making mistakes. I am one of those people. You can't tell me something is hot, I need to burn my finger to understand. For people like me, debt is and was an avalanche. I think once it got to a pint, there was no turning back. Interest, late payment charges. If you fall behind even a bit, it will and can crush you.
Springfield, VA: What makes you think that you will never get yourself into this position again? To be helped out by so many strangers once is wonderful. Do it again, and the people who help you out are idiots. Have you changed your ways, aside from your "celebrity"?
Karyn Bosnak: I have heard this often: "You have not learned your lesson because you did not pay your debt off yourself." But I think I have learned a BIGGER lesson because of all that has happened. First of all, I do not want to get back in debt honestly to save face. And two, after being in almost every newspaper around the wqorld, and receiving about 40,000 emails, I've done a lot of self-evaluation about why I spent so much money in the first place.
Springfield, VA: "Contrary to popular belief, I WORKED for the money I received..."
This detail doesn't often come across when hearing your story, which I have read on the Motley Fool as well as the Post. It seems much more admirable that you worked for what probably turns out to be a pretty low wage doing something that you like and discovering a new career along the way, when you could have also been waitressing (and hating it) making the same (or more) money. What a fascinating trip to find a new career!
Michelle Singletary: I totally agree.
Karyn Bosnak: I do belive that things happen for a reason. So I would not change anything I've done. And in the process of finding a new thing to make myself happy, I think my website made other in debt get serious about their debt. It made people pull out the calculator and add there credit card balances up. That's the first step, and was something I NEVER did fo fear of what the number would be. It gave people who felt alone and in a hole a bit of inspiration. Number one, they realized (as did I) that they are not the only person in debt. And two, they need to think outside of the box to get rid of it.
In DC: Hi Karyn –
Quick question: Is your website still up? and if so, what is the address. I would like to visit! Thanks.
Karyn Bosnak: www.savekaryn.com
There a link on the left to the old original site too.
Somewhere, USA: Karyn, are you now practicing responsible financial management? After reading your first few responses, I doubt it. You don't seem to have learned that your values were false. You're treating your past debt as a silly escapade rather than a sign of a serious lack of understanding of what crdit is for and what life is about. You're like a teenager who crashes the car and then sweet-talks her parents into buying her a new one. Just because someone or 2000 someones were foolish enough to bail you out of trouble doesn't make it OK.
Karyn Bosnak: I don't agree with you. I'm not just looking at this as a money-management problem. I know and admit that my problems with money were the result of a deeper issue of self-esteem.
I'm not stupid; I'm weak. I know - as does everyone else who runs up frivolous debt - that you shouldn't charge things that you can't afford.
Richmond, VA: Karyn - I just checked out your website and in fact, it is funny.
Now for my questions - did you try budgeting in your earlier days? Do you use a budget now? Are there any things you thought you would NEVER be able to live without that turned out not to be a big deal?
Karyn Bosnak: I NEVER budgeted. NEVER. I was a live for the moment kind of girl, always assumming my next paycheck would come. I'm not 100% cured here, but I have made some big changes in my life. I make my coffee at home, I color and cut my hair, I RARELY go out to eat. I buy generic, I buy from the dollar store - I LOVE the dollar store. I buy Bonnie Bell lip gloss. I have Quicken and try to track where my money does go. I try to pay GREEN cash for things - including groceries - instead of using my debit card. These things have helped me.
Silver Spring, MD: Your book sounds a lot like Confessions of a Shopaholic by Sophie Kinsella. Her character worked in TV as well and managed to get out of debt by having an auction to sell all her expensive things! Have you read her books and how does your book differ? Congrats on being so creative!
Karyn Bosnak: My book reads like fiction, hopefully is funny, but does have a deeper message about not trying to be someone you are not. I have haerd the comparisons to that and Bridget Jones' Diary.
Michelle Singletary: You know Karyn in your book and in our discussions you sometimes say things that make me believe you still have the wrong attitude about money and what it should buy. For example, you just wrote "I switched from bttled water to Brita water (gasp!)." Why the gasp? Sweetie some folks don't have enough money to even buy a Brita. They drink tap water and are just fine. They (my grandmother for one) would see the expenditure for a Brita to be wasteful. You seem to think that people should still have brand name stuff -- only now you are proud that you get it on sale. I would agrue that whatever you wear or drink is fine as long as you stick to what you can afford -- even if it is Pay Less Shoes.
Karyn Bosnak: My website was very tongue in cheek, and comments like the Brita were meant as a joke. The (gasp!) was a joke, meaning if that was the worst thing that I had to do, then that's not too bad. In reagrds to clothes, I mix brand name stuff with non-brand name stuff today. I'm getting better... and getting les brand name as time goes on.
Burke, VA: I'm not sure how I came across your Web site, but I thought it was incredibly funny and honest. I didn't send you money, b/c shocker, I was poor too, after being downsized. What some readers may not know is that you did put a good amount of effort into it. You itemized your bills for everyone every month. And it wasn't like you weren't contributing to your own cause. You were just asking for help.
After about 3 years of being in near destructive debt, I am within a few short years of being debt free. Debt is truly the shackle of the middle class.
I'll have to read the book. While sitting in the bookstore!
Michelle Singletary: No. Don't read the book in the bookstore. Send me an e-mail (only Burke people!!!) and I'm send you a free copy courtesy of Karyn's publisher Perennial.
Karyn Bosnak: Thanks. Or go to a library. I don't mind when people tell me that share the book with their friends and stuff. You gotta do what you gotta do!
Somewhere, USA: Did you pay taxes on the money you received? If you are claiming you worked for it, rather than received charity, I wonder whether you paid taxes on your "wages."
I don't have a problem with your choices or solutions, just interested to see if you were consistent in your analysis.
Michelle Singletary: Really good point!
Karyn Bosnak: The site wasn't set up as a business, and honestly I didn't think it was work, and with the advice of an accountant (some random dudes who emailed me) I stated that any money I received would be considered a gift. An Associated Press reporter who interviewed me contacted the IRS and asked them if I would have to pay taxes on the money and they said no. I got an accountant / attorney to do my taxes, and they said the same thing.
So yes, I worked for it meaning I didn't just put up a one page plea, but no I don't and the IRS didn't consider it income.
Alexandria, VA: I'm not sure I "know what you mean" at all. Our living room furniture is about 20 years old (I invented shabby chic). My good purse is older than my daughter. The daughter takes figure skating lessons from 3 coaches, so she is not deprived. I read the fashion mags (by subscription, so they are cheaper), to know which of my clothes are in this year. My husband and I have combined retirement savings in the low 7 figures, and I sleep at night.
Karyn Bosnak: Good for you for not being so caught up in frivolous items and brand name things. Like I said, I know my problems weren't just simple money management problems.
Bowie: When I was college-age and took some time off, I worked in a shopping mall and then a downtown shopping district. I never saved anything because there were too many temptations.
Today I make about what you were making in Manhattan, and live in a house I bought in a blue collar neighborhood, around people who make much less than me and have kids, while I'm still single. I invest thousands a year because I have nothing else to do with the money.
The difference appears to be at least partly, that I'm now in a non-spending environment of people who literally can't afford the extravagences that get many people into trouble. Do you find it's a lot easier not to be tempted in your current situation than it was living a life that sounds like it resembled Sex in the City?
Karyn Bosnak: YES YES YES. This is exactly what I mean. I was a television producer who went out, went to fun media event, and everyone around me looked the part. I felt like I stuck out like a sore thumb if I didn't. I am somewhat removed from that lifestyle now, and that has helped me immensly. I have also grown up a bit.
Upper Marl, MD: How long did it take to get the $13k?
Karyn Bosnak: 20 weeks. I recived $13,000 from people, sold $4,000 of stuff on eBay (which I did have to pay taxes on) and paid $3,000 myself. I fully intend to donate the $13,000 back to charity and have started in small amounts.
Laurel: One cultural explanation for high consumer borrowing is the effect of TV. Sex in the City is the latest of a number of very popular shows featuring single Manhattanites that don't always make much money but whose lifestyle never suffers for it (Friends, Seinfeld, Mad About You).
Did you ever feel like you were in an environment in which it seemed everyone was buying new fashions, and seemed to be making out all right?
Karyn Bosnak: Exactly. Oh, and now I know those people can't look that fabulous for that much money. That Carrie Bradshaw - she's a farce I tell you...
Washington, DC: Where on earth did you get the idea to create a web site? When you created the site, did you hope that you would receive money to pay off your debts? I can't imagine being in debt and thinking of a web site as a solution to my problems.
Karyn Bosnak: My roommate at the time went to a grocery store in Brooklyn and saw a sign hanging on a bulletin board that said, "I need $7,000. If you can help me, let me know. I just need $7,000." It had those tear off number things at the bottom. He cam home and told me about it saying, "Why don;t you just ask for the money?" I thought it wasn't such a bad idea... but thought I'd go a bit more global with my idea and posted a letter on a community bulletin board on the internet. I got 10 responses - one of them being from a girl who said she'd give me $5. So I decided it could work and created a website.
Somewhere: I agree with Michelle that "you sometimes say things that make me believe you still have the wrong attitude about money and what it should buy." For example, when someone wrote about how to avoid debt you said "self-control." ie, you are saying that it is fine or inevitable that we should want more than we can afford, only we should stop ourselves from buying it. You yourself say you're weak, so that doesn't work in the long term. What works is to decide that Prada shoes-- or whatever it is that is beyond your means-- aren't what it's all about. You say you're not stupid, but you also wrote that you need to make mistakes to learn. In my opinion that is stupid and self-defeating. You don't have to make bad things happen to yourself to begin making good choices.
Michelle Singletary: Preach on. You totally got what I was saying. I think Karyn (by her own admission) still has some growing up to do about money matters. I think she should talk to someone about why she had such low self esteem. I go to NY all the time and I'm NEVER tempted to go on a buying spree or feel the need to complete with the fablously dressed New Yorkers. I wear my nice Pay Less Shoes and inexpensive suits to very important meetings and don't care a darn what people think. They ain't going to pay my bills! If you are going to really get a handle on your debt and avoid the marketing machine that says buy more you have to have a lot of self esteem and get rid of any notion that you have to be like others or look good for others or have what others have.
Karyn Bosnak: I agree with what you are saying, and am admitting that I make/made poor choices in life. But hating myself for being weak is not what I am about. I am about learning from what I did. I will not be the perfect fiscally responsible person because of a website. Making a change like that takes time. I am much, much, much better than I ever was, and am getting better every day. Every day I realize more of what life is about. And it's not about shoes, and looking good all the time.
And making mistakes does NOT make me stupid. Are you telling me that you never screw up, you have never been weak? Cast the stone when you are perfect. But ubtil then, don't judge.
Washington, DC: I went to DA for a while & cut up all my cards. DA is a very very good thing. Now I have 0 debt- this is good. However, the rest of the program is about PROSPERING. I think I need to go back. If you ONLY have no debt, it feels not too great- what is my gravestone going to say: She paid off her visa?
I want to do more & enjoy more- so I guess I go back.
Karyn Bosnak: Yes. I am trying to teach myself to be happier with the simpler things in life. I have always lived life for the moment, and I do not want to change that part of myself. But I do want to change the "live life for the moment at no expense part."
Michelle Singletary: Hold up there. I'm trying not to judge you (okay maybe a little bit) but just hoping people see that in many cases their debt is a symptom of a larger problem. And I'm by no means perfect. I do make money mistakes but I get paid to preach so I'm preaching. Karyn Bosnak: That is exactly what I am saying. My debt - as is many other people's debt - is not just a simple matter of fiscal irresponsibility. And by off my debt and starting to save money is not the only answer here. WHY, WHY, WHY did I do it in the first place. That is where the healing will begin!!
Alexandria: I'm amazed at the self-righteousness of some of the people who say THEY never buy blah de blah blah whatever, so they're obviously of purer heart and sounder wallets than Karyn. I don't see it. Anyone who works for a living is asking people to give them money for something. Karyn is no different, for writing a website and asking people to send a couple bucks. She works, she entertains, people send what they think it's worth. Fair exchange.
Michelle Singletary: This is a good reminder to be kinder to spendthrifts. Thanks. All of us frugal people have been rightly hand slapped.
Karyn Bosnak: Thank you. I like to say "I am not the beggar who simply shook a cup in your face. I am the beggar who did a dance, sang a song, told a joke - and then I shook the cup in your face."
My next new book: I have found my next read for a flight home, thanx Karyn and Michelle! I can sympathize on a smaller level, since moving to DC I feel the need to more trendy than my farm-grown hometown in Ohio.
Michelle Singletary: Hey glad you will pick up the book. Despite my criticism "Save Karyn" is a very interesting read. And this is why I do the book club every month focusing only on personal finance related books. I want people thinking, reading and discussing money so they can get a better handle on their own personal finances!
Karyn Bosnak: Yes, the "big city" influence can be a powerful thing. But I have learned that people also admire and appreciate my midwestern attitude. It's something is few and far between in big cities like New York. (I'm not saying anything bad about New Yorkers.) I am catching more bees with honey (by being myself) rather than trying to keep up and be like the rest.
Washington, DC: Hi Karyn!; Don't let all these critics get you down; I was a big SaveKaryn fan because the site was so funny. And no, I didn't send you any money, but I figured you would be okay with me looking at your website for free rather than buying a Vogue or something.
My question is: Do you think that young women in particular are at risk for getting in trouble with credit cards? I know literally dozens of young women who have overspent a LOT. It seems like the self-esteem thing or the need to impress at a new job can be a credit killer.
Karyn Bosnak: I was a brand new producer when I moved to New York, and was nervous that I wouldn't be able to perform at my first job. I didn't have the experience that the other producers had, and was being given a great opportunity. I kind of felt that I was not one of them (due to my lack of experience), so I thought I could fool them into thinkning I was if I looked like one of them. You know I mean?
USA: I have news for Karyn. She did not "fix" her debt. She caused her debt and then people from Ohio and California helped her pay it off. But Michelle--you are still my girl. Anytime a woman preaches thriftiness she makes all females look better. You go Michelle. Karyn--life--get one.
Michelle Singletary: Now, now. Don't be mean. I'm glad I'm still your girl tho.
Karyn Bosnak: I fixed it more than I would have fixed it by not paying the debt and/or defalting completely and/or filing for bankruptcy.
Michelle Singletary: Well folks, we are way over time and I've got to go. I really want to thank Karyn for taking so much heat. This has been a great discussion. This why I love the book club. I hope you all enjoyed the debate and come back real soon for another Color of Money Live Online chat. Now, go save some money $.
Falls Church, VA: I happen to be about $20k in stupid credit card debt and I'm working my a-- off to pay it off. In the process, I'm learning how to budget my money, how to save, how to live without things I want, how to cook at home,how to plan for unforeseen circumstances, how to clip coupons and basically how to pinch every penny until it screams for mercy. What did you learn?
Karyn Bosnak: I will say that I have learned/am learnig pretty much the same. I will reuse coffee filters, clip coupons (but don't let the coupons influence me to buy more expensive items that I might not have bought in the first place), buy in bulk, cook and freeze food, downsize my life (I still sell stuff on eBay), etc. I'd rather be naked sleeping on the floor and be debt free than be surrounded by stuff and owe money.
Thank everyone. I am going. Bye bye.