I’ve been stewing over something for the past few days, and I’m finally ready to write about it.

I’m not a fan of judging others and their actions. Like Atticus Finch, I believe you never really know a person until you stand in their shoes and walk around in them. But I’m human. Like everyone, there are times I can’t help passing judgment. And although I know that judging others isn’t productive, sometimes I’m at a loss to do anything else.

Rock bottom
I had dinner with my buddy Michael last week. Michael’s moving back to Portland after several years away, and his financial life is a mess. He’s had a rough couple of years:

  • He lost his home to foreclosure.
  • He lost his job.
  • His wife is out of work, too.
  • And, last month, Michael filed for bankruptcy.

Not all of Michael’s problems are due to the economy. He’s brought plenty of woe upon himself due to a typical consumer lifestyle. He knows that.

Over a meal of southern-style fried chicken — my treat — we talked a lot about his financial situation. We’ve chatted some in the past, but I never feel like what I say makes much of an impact. I don’t want to be too pushy, for one thing, but I also get the impression that Michael isn’t ready to hear the message. Now, however, that may be changing. He has a haunting, hunted look about him.

Michael told me about the mistakes he’s made and the lessons he’s learned. He also confessed that he borrowed money from a family member, but had never repaid the loan. “It tears me up inside,” he said. “I feel so guilty.” Once he gets everything worked out, his goal is to pay that money back as soon as possible.

Michael explained how he’s hoping to set up a budget; he wants to set money aside for things before buying them. “Plus, I want to pay myself first,” he told me. “I’ve been reading about saving. I want to open a savings account and set aside $400 per month. My wife thinks we should use the money for other stuff, but I really think we should save.”

Old habits
Because Michael is a good friend, I want to help him and his family. (Michael and his wife have two kids.) I’ve been watching for cheap rentals in the Portland area, and even found a house where he could stay for $500 a month (which is incredibly cheap). There are some drawbacks to the place, and I wouldn’t suggest that he and his family stay there long term, but it’d be an awesome temporary home be while they get back on their feet.

“Thanks for finding that place,” Michael told me as he took a bite of mashed potatoes and gravy. “But we’ve decided to rent someplace else. We found a place in Rock Creek for $1300 a month.”

“Wow,” I said. “That seems like a lot.”

“Not really,” he said. “That’s pretty good for similar places in Portland. Plus, it gives us space for our two dogs.”

I sighed inside. Sure, that may be a good price compared to similar houses, but I know there are tons of places to live in Portland for less than $1300 a month — if Michael and his wife are willing to make some sacrifices. I wanted to pursue this line of questioning — What about getting rid of the dogs? Why not look at the $500/month place I found? — but I let it go. You can only argue with your friends so much, right? We moved on to other topics.

Michael mentioned that although his wife is still looking for work, he’s managed to find a job. (He was vague about what the work entailed and how much it paid.) He even has transportation. “I’m borrowing an old beater until I have a chance to buy a new car,” he told me. Michael’s last vehicle belonged to his employer, so he came to town not only homeless and jobless, but carless as well.

“You might want to wait to buy a new car until you’re more sure of your situation,” I said. “There’s nothing wrong with driving an old beater. Heck, where you’ll be living, you could ride the light rail into work.”

“I hadn’t thought of that,” Michael said. And from the way he said it, I could tell he still wasn’t thinking of it. In his mind, he needs a car — and a new one, too.

Further to fall
Before we parted ways, Michael gave me his new cell phone number. “What happened to your old phone?” I asked.

“It was the company’s. I had to give it back,” he said.

“That makes sense,” I said. “What did you get instead? Did you go with a prepaid phone? That’s a great way to save money.”

Michael evaded the question, but when we stood up to leave, I noticed the phone hanging from his belt clip: a brand-new iPhone. Later I learned from a mutual friend that Michael didn’t just buy a new iPhone for himself, but he bought one for his wife and for his 11-year-old son as well. (And he bought his 9-year-old son an iPod Touch so he wouldn’t feel left out.)

This is the part of the story where you now have to imagine a little black squiggle hanging over my head, like in the comic strips. This is the point at which I go from being sympathetic for my friend to judging him — and not favorably.

The mote in my eye
But as I began to silently judge Michael’s choices, I thought of my recent trip to Alaska. I spent ten days on the boat with my neighbor, the “real millionaire next door“, and in those ten days I often felt like I was being judged.

  • Before the trip, I bought a $120 backpack at REI. My goal is to use this for much of my travel during the coming years. It fits in an overhead compartment, and is a great way to limit what I carry. John frowned when he saw the new pack and asked, “What’s wrong with a duffel bag from Goodwill?”
  • On the first day, Mac and I tore a paper towel in half, and we each used our half as a napkin for several days. Eventually my napkin became grimy and gross, so I went to tear off another half a paper towel. When John saw me, he scolded me and told me I ought to use a cloth towel instead.
  • Near the end of the trip, I threw a molding orange overboard. “I wish you hadn’t done that,” John said. “I could have cut out the bad part and eaten the rest.”
  • On the last day, I went to the bookstore in Sitka and bought a copy of Bruce Chatwin’s In Patagonia, which I’ve been wanting to read for a long time. (After our trip to France and Italy this year, Kris and I hope to save for a trip to Argentina and Chile in 2012 or 2013.) When John saw I’d bought a new book, he shook his head. “I’ve got a lot of perfectly good books here on board,” he said, indicating his library of old paperbacks.

Throughout the trip, I felt like I was under pressure to, well, be more frugal, to make the same choices John would make. And you know what? That pressure sucked. It felt awful. I didn’t like the feeling of being judged, especially by somebody I look up to.

To judge, or not to judge?
So, I’m torn. As much as I hate to judge others, sometimes I can’t help it — and now I’m judging Michael. He says he wants to change, he says he’s learned his lesson from his bankruptcy, but his actions say otherwise.

He has no savings, no car, no home. His wife is out of work, and he’s only just started a new job himself. Yet he’s decided to rent a $1300 house, is looking to buy a new car, and has signed up for at least $180/month in cell phones. (I’m ignoring the start-up costs of the phones.) These are just the things I know about. Michael is talking the talk, but he’s not walking the walk. (I’m reminded of a previous conversation with another friend.)

I know how tough it can be to change your behavior. I’ve been there before. I used to talk about changing, too, without making any actual change. I’m sure my friends just shook their heads at me. (In fact, I know that some of my friends used to wonder at my foolish choices — they’ve told me so.)

I hope Michael turns things around, but I can’t help but judge his actions right now. And I don’t know how to help him.

Footnote: During dinner, Michael told me that he’s been reading personal-finance books. “Like which ones?” I asked. “Rich Dad, Poor Dad,” he said. That should have been a big clue that things weren’t right yet. Rich Dad, Poor Dad has some interesting entrepreneurship lessons in it, but it’s a terrible, terrible book to base your financial philosophy around. If I could remove only one book from the hands of people just learning to manage money, that would be the one.

Footnote #2: Okay, folks. No need to leave any more “I can’t believe you said that about the dogs” comments. You’ve made your point. In fact, I’m now whipping up an article for Friday where we can spend all day talking about the relationship between dollars and dogs. (And cats.) So, please: Save your pet-related discussion until Friday.

This article is about Choices, Debt, Real-Life, Relationships