Are you ready? It's 2022, time for a confession. A confession I doubted about a long time. But the time has come to tell it anyway. If only to keep someone else from making the same mistakes I made.
The fact that I am in a difficult financial situation has certainly not gone unnoticed. I have told it several times. But I didn't want to talk about that today. Today is the time to take an honest look at how it got to this point. Because once in my life it was completely different!
A time that is now far behind me, but in which I did throw away a big opportunity. An opportunity to get seriously rich and be rich now. Hence, the title, If only I had known!
I have to go back a long way to explain that. To the time when my parents just got married and lived in a small house next to my mother's parents. That was not an official residence, but it was temporarily tolerated that they had domicile there. Both my older sister and I were born here. But with two small children, that house had really become too small. However, the outdoor space that came with the house was large. My parents had the idea that if they would expand the house a bit, we would have more space in the house, without having to give up on freedom. Unfortunately, the municipality refused to issue a permit for that plan. It was rejected, and my parents were faced with the choice of staying in a house that was really too small, or trying to get a cheap mortgage and looking for a house to buy.
At that time, new homes were being built in the village. These homes were intended for starters on the housing market. And therefor, affordable! My parents went to have a look, and soon they decided to buy one of those semi-detached houses. They took an option and talked to the bank. They could take out a mortgage of then 80,000 guilders. And so my parents became the proud owners of a newly completed house. Over the years, a lot has been renovated and added to the house and of course maintenance, modernization, etc. Besides being a carpenter, my father was also good at laying tiles, plumbing, installing central heating ... everything you could need in a house. It is therefore not surprising that the house had considerably increased in value over the years.
When our father died of lung cancer in 2005, our mother was the surviving, and automatically full and sole owner of that house. Unfortunately, she couldn't enjoy this for long, and in 2007 she passed away from the consequences of COPD, and at that moment a lot changed for my sister and me.
Because I had quit my job to take care of my parents in 2004, and since 2005 I received a benefit from the municipality where I lived on, I was the first to have to deal with this. It is impossible to pay even the smallest mortgage from a benefit. And buying out my sister was completely impossible, of course. In addition, it is also a rule that if your assets exceed a certain limit, you are no longer entitled to a benefit. And with the inheritance of a 'half house' you are suddenly above that capital limit. That much should be clear. Which therefore meant that the benefit that I would still receive until the money from the inheritance was in my account suddenly became a loan. And yeah, I had to repay that once the money was in my bank account. And I would also no longer receive the benefits from that moment on. They even calculated the years I should be able to live off the money I would receive.
My sister had a job at the time, but wasn't earning enough to buy me out.
We could have said we'd stay in the house together, but what if one of us got into a relationship, or whatever reasons you can think of for not wanting to live in a house with your sister anymore.
Conclusion: We had to sell the house and after deducting the small mortgage that my parents had always kept for tax reasons, we would both have an inheritance.
The sale was not a problem. The house got sold within a day. We didn't know before we started the sale, but on Saturday we told our family that the house would be for sale as of Sunday, and on Monday a cousin of ours had bought the house.
1 month later, all notarial matters were settled and my sister and I both received 160,000 euros deposited into our accounts. And that's really where what I want to say begins. Because 160K euros is a large amount. At least it was for me then, and it would be again now...
From the time of my mother's death to the time of payment of the purchase price of the house, about five months had passed. So five months in which I had received benefits, to which I was no longer entitled. And so five months of benefit that I immediately had to repay to the municipality. But hey, with 160K euros in your bank account, that's the least to worry about. So pay back immediately, and that's it! Two weeks after the payment of the inheritance, a blue envelope fell on the doormat. Oh god, yes, of course! The tax! Let's see how much they want. And I can tell you, the inheritance taxes back then were no joke. Both my sister and I had to pay about 23% of our inherited capital for inheritance tax. We were not exactly happy with that. I can tell you that!
It's the most unfair tax there is if you ask me. My parents bought that house with money they have always paid tax on, the house itself has always been taxed. Then my father dies, and my mother has to pay tax on the total assets, whereby a child's share is already counted for both children. Then our mother dies, and my sister and I have to pay another 23% tax on the inherited assets. But hey, we could worry about what we wanted. That doesn't change the fact that we just had to pay. And 23% is a huge amount.
In addition, of course, I now had no other income, only capital. And there was a problem. I had no one to educate me, I had no one to tell me, to teach me how to deal with my 'financial freedom'. And after living at an absolute minimum for a few years, that financial freedom was also something I overestimated.
The depression that I ended up in after the death of both parents certainly did not help to see in time that things went wrong. I started by buying a new car, it could easily have a camera on the back and many more things. In addition, I had to live, and of course you understand that I no longer paid attention to the price when I went shopping. I didn't have to look at it, nor did I want to. So who did I care that detergent A was 3 euros more expensive? And what did I care that perfume A was 20 euros more expensive than perfume B? Just nothing at all! Of course, I also had a monthly rent that I had to pay and other fixed costs such as insurance etc.
And all of a sudden I found it very necessary to refurbish the house where I lived, not just a little! No, I went for the whole. A renovation where I created an open kitchen, well, not me. I had that done! But that cost a nice penny again. And well, while I was at it, do something on the walls right away. So I bought wall paint for most of the walls, but one wall had to become the eye-catcher in my house. And for that I bought a shockingly expensive wallpaper. And oh well, the floor ... that really wasn't nice anymore. No, I wanted a decorative gravel floor! It was easy to keep clean now that I also had Rowan in the house, and it looked beautiful! In the end, the renovation of that house left a big hole in my capital, but it was beautiful when it was finished. Unfortunately, I didn't get to enjoy it for long.
In the meantime, I had also met a guy that I was very fond of. And I THOUGHT it was mutual. We had photography as a common hobby. Well, that means, for me, it was a hobby! He said he was a professional. Only he had a little problem. His equipment fell short. My still sensitive heart went out to him, and after only 1 evening I was convinced. I would lend him 10K euros, and I would buy his 'old equipment' from him for 3K euros.
And I swear, I felt so good doing this! I helped 'my lover', and as soon as he could, he would pay me back. A story with a happy ending, right?
Unfortunately, things turned out a little differently. 'My lover' disappeared into thin air with my money. And despite the fact that we had drawn up a contract (yes, I had just been that wise), I still found out that I couldn't do anything. 'My lover' had so many debts to his name that he started a procedure for debt restructuring. He was included in the program, and I could whistle for my money.
But after all these crazy excesses on my part, and the normal livelihood, the bottom of my treasury had also come into view.
For years, I literally cursed 'my lover' for having messed with me so much. And trust me, it's no fun going through this. But, it's 2022 now, it's time to clean up. And to be honest, "No one has been there to tell you to do this". There has also been no one to tell me that I had to renovate my house for so much money. No one has ever decided for me that I should spend that money… I actually did it myself! I was the one who realized too late that my capital could run out, and ran out!
Yes I learned a lesson! A very expensive lesson!
If you suddenly have access to a nice capital, invest it wisely! And yes, of course you can treat yourself to something nice! Certainly do! But invest it, grow it and be careful with it. Because really, you can run out of money again much sooner than you'd expect.
