Part 1Author’s note: This four part-series on relationships and managing money was originally written for The Royal Gazette in Summer of 2003. The content has been updated to reflect our current recessionary environment. This is a composite case couple, with no intended physical or factual resemblance to any individual / couple residing in Bermuda or elsewhere. Living the Idyllic Life and Owning a Piece of the Rock in Bermuda. This week (and the three segments to follow) we are going to examine the financial (and emotional) life profile of our composite couple, Joe and Tanya Smith.As we progress through a small segment of their simple (they think) lives, perhaps you may recognise familiar patterns in your own family. We will analyse their current financial situation, track them through a serious of significant life and economic changes in Bermuda, then provide an individually tailored financial plan to assist them in keeping their lives focused on their goals, attaining their dreams, and achieving future financial security.Mr and Mrs Frugal. Joe is 43, Tanya is 40. They’ve been married 15 years and have two children, a boy George (eight) and a girl Crystal (13). They are a good-looking couple, but constant fatigue has prematurely lined their faces.They still feel they have built a wonderful life together. Finances are always very tight; but they set aside time to go out for modest dinner once every three months, that is, when their schedules coincide. It used to be once a month but they are feeling particularly cost conscious these days. Crystal, their daughter, is responsible, and willing enough to care for George for short periods, especially as they believe in paying her market rates.Years ago, they met on a bus. While they did not grow up near each other, he’s from Southampton and she is from St George’s, it seems as if they have known each other most of their lives. Bermuda is like that. As children, they attended different school systems; neither of them liked formal education. In fact, just they just barely scraped by scholastically, waiting for the day to get out and earn their own money.Down the Way Where the Nights are Gay, Drifting. For quite a few years after high school, both of them drifted completely unmotivated from job to job, spending each paycheque as fast as it came in. Joe had worked in retail stores, driving a delivery truck, tried repair jobs for a while, and was getting into computer repairs.No manual labour for him.He was obsessed with old electronic equipment, meticulously building a huge collection of sound tapes and records. You remember those 33 big plastic things?Joe’s father, arriving home after long days spent running a small landscaping compan,y upon seeing this accumulation of trivia, was often very critical of his spendthrift son. “You should be getting some more education, boy, so you can help this business grow, and I don’t have to work so hard. I wish that I had your chance for education.”Customer Service, Not. Tanya tried jobs in customer service (she hated it, “may I help you, Madam?”), office administration (file clerk, she was bored out of her mind), and shoe shops (she loved it, but you can’t eat shoe discounts). She stumbled into doing a little bookkeeping at one small business she loved the numbers, now that was easy! Not too seriously she decided to take a college correspondence course in accounting.Tanya’s big weakness was shoes; like fashion-obsessed women everywhere, she thought she was Imelda Marcos’ cousin. She owned more shoes than her own mother, no contest there! She and her mother did not get along; as directionless as Tanya felt sometimes, her mother was worse. At age 58, her mother was still spending every cent she made, and sometimes borrowing from Tanya before next payday. “Are there some parents out there who never get it together,” she wondered?Goals, what goals? If you had asked either of them what were their personal goals? Or, what did they want to do with their lives? You met a blank stare.What goals? Not to be bored was a big one, said Tanya.Joe said: “He never thought about it, he just wanted to have a good time and listen to cool sounds.” Some day, he was sure his record collection would be valuable. Sometimes he went all-day fishing with his friends.At that time, Joe is an only child and still lived with his parents. Tanya shared a small apartment with a couple of friends. Kids could still do that (on starting-out wages) 15 years ago. Nor did they even like each other back then, although by their middle twenties, they moved in the same party circles.And the trips! How they both loved going on trips! Joe had even been to Tahiti; “too long to get to a place almost like home,” he said. After that one, he and Tanya started seeing each other; they were married a year later.In true Bermuda party fashion, they spent everything they had saved, and ran up their credit cards for an elaborate wedding. One of the gifts from his parents was a year rent-free in the large studio apartment in the basement of the parents’ small cottage.Opportunities derived from tragedy. Life has a way of shaping us, does it not? How you play the cards you are dealt, determines your character. Within weeks of their marriage, Joe’s father, at age 56, passes away worn out from a life of physical labour and onset of diabetes.There are few assets: a small pension, $100,000 in a passbook account and a debt-free house to his mother. His father loved him fiercely, and in a great surprise left him a very small life insurance policy. His mother, with no employable skills, is slowly diminishing before their eyes. Joe is forced to leave his electronics sales job, and take over the family business. His mother insists they pay rent; she can’t make ends meet as it is.And there they were, with no savings, facing their first tragic life crisis, the challenge of operating a marginal-return business in a tough economic environment, no place to call their own, and a dependent mother-in-law.They have a revelation, determining with every bit of resources they can muster, that they will some how, some way buy their own home.Joe and Tanya are managing to handle some physical and mental hardships. But how financially and emotionally equipped are they (or most of us really) for catastrophes, even on a small scale? How balanced is our family planning when life hands us a setback? Could we be better prepared? Stay tuned for the next three segments. Martha Harris Myron JP CPA/PFS CFP(US) TEP is an international Certified Financial Planner™ and a US tax practitioner with Patterson Partners Ltd specializing in cross border tax and financial planning, retirement, and estate strategies for dual citizens of Bermuda and the US, foreign nationals with US connections, and US citizens living abroad.She serves on the American Institute of Certified Public Accountants Advanced Personal Financial Planning Conference Committee.She is a Masters in Law candidate in International Tax and Finance as well as the American Citizens Abroad contact for Bermuda www. aca.org. Contact martha.myron[AT]gmail.com or 296 3528The financial planning case composite described above does not represent any living individual or family. Any resemblance to any real person is purely coincidental, and does not imply endorsement of any particular lifestyle, culture, religion, or ethnic background.The article expresses the opinion of the author alone, and not necessarily that of Patterson Partners Ltd. Under no circumstances is this financial advice to be taken as a recommendation to buy or sell investment products or as a specific individual financial planning advice. The Editor of the Royal Gazette has final right of approval over headlines, content, and length/brevity of article.