This post originally appeared at Girls Just Wanna Have Funds.
If you haven’t heard about Teresa Giudice by now, where have you been? She’s only the latest reality TV star to get caught up in trying to keep up with her rich friends by amassing 11 million in debt.
I generally like Teresa’s bad a$$ character from The Real Housewives of New Jersey.
She says what’s on her mind and she means it, albeit littered with expletives I wouldn’t say around children. But, I have to wonder why this woman who plays such a “boss” bitch” character on a reality show didn’t play the same role in her marital finances?
Recently, she sat down with In Touch magazine to discuss her path to bankruptcy. Yep, she and her husband declared bankruptcy to the tune of $11 million.
Essentially, she says they racked up the debt via fancy parties for the kids, 6 figure car ie their leased Maserati where they still owe $60,000, extravagant shopping trips with her friends and their over the top gold and marble home.
Their bankruptcy petition, filed in federal court in Newark, New Jersey, lists $11.8 million in debts. That includes $5.8 million on various business investments made by Joe, $2.6 million in mortgages on three homes, and $12,000 owed to a fertility clinic.
The couple also list $104, 000 in credit card bills, including $20,000 to top-tier department stores like Neiman Marcus and Nordstrom, and $2,300 to the phone company.- Radaronline
What can you learn from Teresa?
Communication: You need to be on the same page as your spouse about finances, even if he isnt. She didn’t get the hint when he started telling her to ease up on the spending, but he should have sat her down and told her exactly how dire their financial situation was at the time.
Know Thy Self: If you’re buying on credit then you can’t afford it. Doesn’t matter how long the credit line, at the end of the month you still have to pay it back to the bank.
You Home Isn’t An ATM: My guess is that they used some of the equity from their homes to finance their lavish lifestyle. Leveraging the equity during good times helped them live the life they love so much. Again, living on borrowed money they would never be bale to pay back.
Teach Your Children The Value of Money: Watching the show you would think this was the last day on earth for the kids. She went overboard with spending on their parties, clothing and anything else they want. As a result, sorry to say it but her children were like rabid brats who didn’t understand the word NO. And rightfully so, she rarely said no even with their strained finances looming. Parents often say to me “well I want my children to have more than I did”. Those are your wants, not your children’s. Separate the two and understand that you children just want your unconditional love and a stable living environment.
I sincerely hope they learn lessons from this process but something tells me they won’t any time soon. Keeping up with the Manzos seems to be top on their list of priorities. By the way, I love Caroline!
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See Also:
- A CFP Sounds Off On Why 20-Somethings Need To Get A Financial Life
- This Social Worker Wiped Out $37,000 Of Debt In One Year
- 4 Mind Hacks To Keep Your Spending In Perspective