When Did You Start Caring About Personal Finance?
Posted by Cap in Even More Ramblings |Question:
When did you start caring about your finances? And how did you come across these personal finance blogs?
I’m really curious, by the way. Although I always read all my comments, I promise to pay extra, tender, loving attention to comments left in this particular post.
My Answer: (for those that care)
I’ve mention the 10k+ of debt I incurred during my spending years before. Basically, one day I woke up, logged into my Bank of America account and saw something along the lines of: Checking account: $24.76. Credit card balance: $10,642. On that particular day, the debt level really struck me.
Perhaps it’s because the amount in my checking account will hardly cover the minimum payment. But more importantly, I was making money. I was making enough to pay off that debt, but somehow… the amount I owe hasn’t changed in months, and if anything — it has increased.
Alhough when compare to others, 10k+ isn’t a lot… but it was a lot to me at that time, considering how I didn’t have any large expense. I was bumming lodging off of mommy. The car payment was paid off. The school tuition taken care of by grants. Just how the heck did I accumulated this amount, when I was making money? (You see, in my mind, if I wasn’t making money… oweing money would have made more sense. heh).
I looked around my room, saw the numerous junk laying around. Rummaged through the stacks of old receipt in the tissue boxes (wasn’t really into shoes), and realized that I was squandering away my money. I realized that if I don’t change my ways, I will never pay off my debt and will never truly have the ability to take care of myself financially.
And so, I started to care more about my finances. I stopped buying crap (hence the craptastic blog name). I put efforts into paying off my debt. I found ways to reduce my interest rates. I started to save money.
On another particular day two years ago, I tried Googling for other similar accounts to ING Direct. Stumbled upon Jonathan’s My Money Blog, thought it was incredibly neat how people are sharing and writing about their finances. Hopped on the bandwagon, and now here I am today, asking you this question: when did you start caring about your finances?
44 Comments to “When Did You Start Caring About Personal Finance?”
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March 16th, 2007 at 7:51 am
I started caring about my money at the start of the new year. My checking account was always at a negative balance and my credit card was supposed to only be used for “emergencys only” but I kept buying crap on it. So I put my foot down and have zero dept and it’s only March. I’ve got an emergency savings account building up and my checking account is always full of money. The number one thing that has helped me is looking up money saving tips on the internet and reading books like The Tightwad Gazette and Americas Cheapest Family. I look at my checking everyday and keep track of all the crap I can stop buying.
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the Tightwad Gazette is indeed a spiffy book, thanks for sharing Misiti.
March 16th, 2007 at 8:14 am
When your blog (and others’) popped up on the front page of Yahoo! Finance. I’ve been engrossed ever since.
March 16th, 2007 at 8:40 am
When I realized that my car payment was nearly equal to my rent and that I was planning on getting married soon. Oh yeah, wondering why I couldnt properly buy groceries while I was making money as well. Then the blogs came along and now I’m an evangelist!
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Ah seems like the same deal of “where’d the money go?”
March 16th, 2007 at 10:03 am
It sort of hit me in spurts. The summer after my Freshman year of college, I realized that since I didn’t come from money, I’d have to learn how to generate it myself, so I bought The Motley Fool’s Investment Guide For Teens. I took two things away from that: Index funds and using a credit card responsibly to establish credit.
However, I didn’t really “learn” either of those things. I noticed that you needed about $3,000 for a minimum deposit to get an index fund from Vanguard, so I held off on that, hoping to save up my money for a few years – rather than trying to look for other options. I didn’t even know where to look.
The credit card was where I got into trouble. I got it and paid off the balance every month for six months, and then I hit a wall. I had tons of school expenses, and no money, so I started putting everything “necessary” on the card. And also putting crap on the card. And flying to Los Angeles… on the card.
Suddenly I was nearing my credit limit. A paltry sum of $1700 or so, which is nothing compared to most people, but it was enough to REALLY wake me up this time. A friend recommended I Will Teach You To Be Rich… and since the moment I got into the PF Blogosphere, I haven’t been able to pull myself out. I’m hooked.
March 16th, 2007 at 10:06 am
$10,6420? dang… you were so far in debt that you started seeing extra zeroes?
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typo. hah. and that’s zero not zeroes :P :P :P
March 16th, 2007 at 11:03 am
(I read that as: “somewhere along the lines of … ten thousand, six hundred and forty-twenty dollars.”)
I have cared about personal finance as long as I can remember. I grew up knowing we couldn’t afford much, so I never asked for anything.
When I got an allowance my first year in college, I used part of it to buy some useful things I’d always wanted, such as my very own scissors and fingernail clippers that I could always find!
My fourth year in college was particularly tight because I had decided to decline one of my student loans. I saw only free movies, and I never paid to take a bus if I could walk (even to the grocery store). It was easy because I was young and healthy and had a lot of homework to take up my time.
Then I focussed on paying off my student loans, although my interest rates were so low that I probably should have been contributing some money to retirement accounts.
Then I saved for a car and started saving toward retirement, then I saved toward a house.
I periodically like to re-read “The Tightwad Gazette” to inoculate myself against all the messages about buying, and I periodically keep track of everything I’m buying for a few months when my budget doesn’t seem to be working well. I periodically decide I want to add a new category to my budget or separate one category from another. Each year that I get a raise, I make adjustments to my budget.
There is always more to learn. Now I am trying to teach myself that I really don’t need to keep everything I own (nor do I need to own everything cool). Sadly, I also can look around my room and see “numerous junk laying around.” For example, if I have only the clothes that will fit in my closet and dresser, that should be enough clothes. But it’s like part of me is afraid I might suddenly be poor for years on end and my clothes will wear out and then I will be glad that I had these spare clothes lying around in the garage. Yes, this did happen to people during the Great Depression and could happen again, but it is highly unlikely!
Also, things keep changing. In the 1970’s, it was good to keep cash in savings accounts–they paid 5% interest! Then interest rates plummeted and I started using CD’s, occasionally paying the penalty for early withdrawal, and that was still better than using a savings account. Then I-bonds looked pretty good for a while–I got a few when they were paying 3% + inflation–but those have a lot more restrictions now and aren’t as good a deal. Now I keep my spare cash (emergency savings) in an online savings account, which pays about the same as CDs at my bank but which is more liquid. Who knows what lies in the future?
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great point on the student loan.. sometimes if the rates are so low, it’s probably better to not pay the student loan off all at once, and instead allocate them to other savings/investing goals. ditto on excessive clothes, I still have stuff I bought years ago that I haven’t worn yet. simply because they were cheap at the outlets. doh
March 16th, 2007 at 11:56 am
I started really caring back in early 2001. The economy started to turn down and it hit Florida (where we were living at the time) really hard. My husband and I both lost our jobs within months of each other and we had to find a way to pay our bills on unemployment, which in Florida, was an outrageously small amount. My husband was unemployed 5 months and I was unemployed 8 (a few of which overlapped). We had no savings and a lot of bills. We didn’t think there was a chance we’d both lose our jobs at the same time and we were making decent money, so what was the harm in owing so much?
As soon as we were both working again, I made it a mission to get everything under control so we would never be that helpless and unprepared again.
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ah I had similar mindset too. only reason why I didn’t get into serious trouble was the fact that I lacked any large expense. you’re right though, it’s entirely about being financially prepare for many different scenarios. as was mentioned, who knows what the future holds?
March 16th, 2007 at 11:58 am
Sadly at the tender age of 25…when I noticed that I’d been working for a couple years with less than 1k in my savings account. It’s amazing what you can do in a year.
March 16th, 2007 at 12:56 pm
@ Stephanie, try tradeking.com or t. rowe price you can start as little as $50/month for an index fund.
I started caring about my personal finance at 29, when I bought a house.
The first blog I came accross was 1stmillionat33. Since I was 33 years old, I figured I gave it a click and been hooked on pf blogs every since.
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I also use tradeking for my lumps of ETF index purchases. Stephanie should mind the transaction cost when using tradeking (depending on what she’s trading), although the $4.95 per trade cost is lower than some other discount broker, they can still add up easily and really put a dent into the returns.
March 16th, 2007 at 1:33 pm
For me, it was after my mother died and I was due to receive a sizeable inheritance. I knew it was my one big chance to really to straighten things out. Up to then, I had always carried a CC balance of around $20k. Always stayed current, but could never knock it down much. Always stuck renting a 1 bedroom apt.
Even before I received anything I started educating myself by listening to Clark Howard, a great radio consumer advocate, and just trying to wise up about money and investing.
By the time the money came, I had my plan. I paid off all of my CCs and auto loans, used some to put a downpayment on a home, and lastly to fund a 6 month emergency fund. I think the only luxury I allowed myself was a new TV, because the old one had a chip in the screen and drove me crazy.
Ever since then, I’ve been putting money away for my retirement, and staying out of debt. My only debt is a 0% interest loan from CCs, which is earning interest in an online savings account. When that term is up, I’m paying it right off and keeping the interest.
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thanks for sharing Kevin. great that you planned ahead of time to find out how best the inheritance can help you.
March 16th, 2007 at 4:23 pm
I’ve always care about my money and been a saver since I was a little kid, and understood the value of green paper. I’m a lucky adult that has two degrees, no debt, but still lives at home until I can get full-time work.
I’ve been reading this blog, a bunch of others, and started my own since I worked a temp job in a finance department. Learning more about the many options and intricacies of my money has been fascinating. As an environmentalist, and an attempting-less-consumer I think it’s a great blog. I find a lot of inspiration and fellowship here, the humor helps too.
March 16th, 2007 at 4:28 pm
I’ve always cared about putting money in the bank, even when I was little. For a long time, that meant spending less than I made. I had invested about $5000-6000 while I was in high school, and had another $2000 in the bank when I entered college.
Then, last year, I dated a guy who made a lot more money than me. He repeatedly invited me to do things with him, but expected that we’d pay separately for events requiring tickets or hotels. $800 worth of expectations in 2 months of dating. I asked when it would end – I make X and he makes X+25K – and he responded by telling me I wasn’t worth dating if I couldn’t afford to have fun all summer. “What kind of person can’t afford $150 for a beach trip???” I was in the midst of fixing my car, moving, buying furniture and saving up for grad school. I bank 20% of my salary annually, and it’s not like it’s easy. In short, I’m the kind of girl most guys would be happy to find – one who’s not out spending all “their” money.
Now I’m focused on earning every extra dollar – or hundred or thousand – that I can.
After that disaster, I vowed that I will never, ever, be told I’m unworthy because of my salary again. I plan to go back to school next fall to earn my MBA, after which I will be making way more than I am now and more than most guys I know. My goal is to earn enough money, and invest such a large portion of it that I never again have to waste my time in such a degrading relationship.
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wow the guy sounds like an incredible douche ball. I understand that you don’t want to be in that position again, but I think you shouldn’t aim to achieve a certain income level just so you won’t have to deal with someone telling you that you’re unworthy (although I may be assuming, since that may not be your only reason/goal). fact is, that guy you dated was a complete materialistic moron. his opinion and idea of a girlfriend is incredibly narrow minded — and although there may be a few other douche bags like him out there, their opinions should be ignored completely. guys like him will probably end up as a lonely old man.
March 16th, 2007 at 5:55 pm
GREAT TOPIC!
I actually have THREE answers:
1. I’ve “always” worried about having a job and staying current with all of my bills. Even without a budget, etc. I made sure that I was a “good customer”.
2. Three years ago I started listening to Dave Ramsey… and the light started to come on, just a bit.
3. Two years ago, at age 30, having worked for 14 years, I had less than 500 dollars in the bank and over 11.5K in credit card debt… That’s when I started my blog, and That’s when I started changing my life!
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The first two pfblogs I found? Neville’s Blog and PFBlog
NCN
March 16th, 2007 at 6:26 pm
About 6 months ago. Much like you, stumbled on MyMoneyBlog and was intrigued by his super-leet 0% bal. transfer skillz. From there found your blog and Get Rich Slowly, been hooked to all three since(also Make Love, Not Debt, cracks me up). Always liked this type of stuff and had blogged quite afew times ago giving, social justice, luxuries, etc, before I knew much about it.
Even started my own foray into the topic of PF, focusing on how PF and faith interact. It’s called Cash Money Jesus (shameless link whoring complete).
March 16th, 2007 at 11:30 pm
once i became a stay at home mom finances run through my head 5o gazillion times a day. (sigh)
what i would like to learn:
1.how to get that 10% earning potential on some investments(is it a lie?)
2.how to retire, travel once a year for a week, and live off our retirement comfortably
3.what are the best places to find the MOST interest rates on checking, savings, money market accounts
well, i’ll close now it’s starting to sound like i have NO clue of what i’m doing. it’s true, i don’t but, everyone else here seems to be geniuses so, i’ll close now :)
March 17th, 2007 at 10:13 am
I started caring when my credit card debt became too much for me to handle. The amount wasn’t large at all. I was unemployed and missed payments on my cc bills. The threatening phone calls from cc companies came pouring in and that’s when I really started caring about my personal finances or lack of. Started paying down my credit cards by finding contract work and by abstaining from everything that I enjoyed like snowboarding, drinking and eating out. I never really kept up with the Joneses but it got me to thinking why people are so consumed with impressing people they don’t know and might not like with material things such as clothes, cars and huge homes. My financial situation is much healthier now. I don’t ever want to go back to those days of having a large credit card bill that hangs over you like a dark menacing cloud. Came across your blog by chance/google.
March 17th, 2007 at 12:30 pm
Same time you did. Except mine happened a month ago but it’s a very similar story to your own. That you, apparently, have found a way out really is inspiring to me.
Onward and upward, I hope!
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Keep it up Patty! It’s entirely feasible. My thought was, if I made the mess… I sure as heck can clean it up!
March 17th, 2007 at 4:18 pm
I used to be a real CNN junkie, and if you watch CNN for very long at all you’ll see lots of ads for investment companies, and there’s a big subtext that you’d better start saving for retirement tout de suite.
So for as long as I’ve been gainfully employed, I’ve been concerned about spending money in responsible ways… which doesn’t mean that I’ve always been good at it!
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No worries Emily! The same applies for everyone. I mean, look at my “woops, bought crap” category. Plenty of silly things there. Still, it’s not about hording it all up anyway.. the point to gain financial independence is so that when given the chance, you can spend without worries.
March 18th, 2007 at 7:09 am
The funny part is that the ex was actually a cheapass. We both grew up in families of modest means; when he’d take me to dinner, it would be to an average restaurant or somewhere nicer if it was an occasion. However, he’d spend all kinds of money when we were with his friends – but then would ask me to pay my 1/2. It wasn’t so much being asked to pay some things that offended me – it was that when I balked at the expense, he said “what kind of person…” and called my values into question.
I responded with “what kind of person hears his lady is suffering and responds by telling her she isn’t worth dating?” A real man would have felt his heart ripped to shreds, and either taken care of the hotel bill or offered to stay somewhere else with me and meet up with his friends later. He would not have said “well if it’s this bad now, how is it going to be when you *are* in school”
I wanted my MBA anyways, but using the anger/frustration from past experience helps fuel the motivation.
I also have to consider that my mom is poor. Right now, she’s working poor, so I don’t have to help out with anything, except maybe a plane ticket for her to visit me. However, I know the time will come when she’s either in a crappy medicaid nursing home, or I’m suffering to pay for her care. At my current income level, I can’t afford enough to really make a difference; any assistance I could provide would simply be offset by a reduction in government assistance. I don’t want to end up resenting my mom for her life’s choices, or feeling that she’s a burden. I want to have enough that I can take care of those kinds of bills and still do well for myself and future family of my own.
The things that kept me from pursuing a tougher and more lucrative career in the past are no longer here. There’s a whole laundry list of things that have changed, but the events of the last 2 years have been pivotal in changing my mindset from “be comfortable and secure” to “take the world by storm and make a fortune”.
March 18th, 2007 at 12:41 pm
About fourteen months ago at the advancing age of 38, I had just been hired to start a job I vowed I would not do anymore. “Okay, I’ll do this job for a year but I have to do something about my financial situation.” I sat down got out all the credit card bills and totaled them up. The damage? $19,500. I had not really been paying any interest maybe 2% on a chunk of the balance but mostly 0% (I had become a very savvy CC surfer–still am.) But $19,500 worth of debt is still $19,500 worth of debt. I had just over $1,000 in savings.
Now while I was never really “into” money (in fact I probably would have called myself a communist before a capitalist) I had turned the corner before in my life. I was living in LA about four years ago and was down to 5K worth of debt and 3K in savings but then made a very profound mistake. You see I was a single man working in the entertainment industry driving a hideously banged up GEO Prism, that while anything but a babe magnet (babe repellent even, I actually had a woman on-line tell me that I “obviously had no self respect if I allowed myself to drive that car…” TRUE STORY.). So I bought a new car. I bought a new car and you guessed it…the debt soared, increased insurance, car payments, repairs, etc…all to the tune of an additional $600.00 per month. Money and debt became “conceptual” again and I slipped deeper and deeper in debt.
So back to my moment of reckoning in February of 2006. Facing this financial and existential crisis (again, age 38–oh yeah and two master’s degrees). And so I started. I did every thing they say to do, I started writing down every expense, I paid myself first, I opened up the obligatory ING account on line, stopped eating out, and added something of my own, I vowed to pick up every penny I found on the ground (which inevitably has led me to start finding much more than pennies…I found three dollars this past Wednesday…interesting how that works out.)
So, I’m happy to report that in the last year or so, I’ve managed on a salary just under 60K to pay off 6K worth of debt (still all covered by 0% cards) and saved an additional 9K. So now I have 13K worth of debt, 10K in the bank and a budding career as a financial planner/coach (I have been seeing friends helping them get with the program…and just signed up for a course (”Fundamentals of Financial Planning” at NYU) and have become a total geek about all personal financial products…oh yeah, and I did this living in New York City paying $1,300 a month on rent.
I’ve also done a tremendous job helping out my new girlfriend who, just coming out of divorce, was faced with a mountain of financial problems…she’s now more on her game than she’s ever been in her whole life and we’re in love with each other and all the wonderful cheap and free things we can do with our free time (museums, walks, elaborate but cheap meals, etc. etc.).
So I am a convert. And oh yeah, I just started a blog this week for the very first time in my life…with the awkward URL of “www.basicfinancialfitness.blogspot.com”
I’m giddy with all of this and am in love with the on-line community of folks sharing information about themselves and their financial struggles.
Love this blog, especially the title, because I think it is all about getting off the crack pipe of consumerism…buying has becoming a impulsive response to a generalized anxiety…not a thought behind it, nothing but fear. I see it around me every day, so yes, stop buying crap! Thanks for the question.
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And thanks for the great response. When I came to the part about the GEO, I knew what was coming up next. It’s true though, that thing is such a repellent (of everything), but eh, if I ever have a kid, their first ride would be a nice used Geo-ish beater. Again, thanks for sharing.
March 18th, 2007 at 11:55 pm
I am weird. I never carried any debt. No debt, whatsoever. I am completely unleveraged.
I have been interested in personal finance ever since I can remember myself and have always been talking about it with friends and family, but I have never really heard of PF until a chance conversation with my brother-in-law a few months ago. A quick google search later and BAM. Hooked.
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Consider yourself on top of the game, you weirdo you. Most of us required a good slap in the face to become weird, so being a weirdo from the onset is totally awesome :)
March 19th, 2007 at 5:44 am
Well, I’ve cared about and struggled with finances since I started college at age 18. Far from the image of the student who is spend-happy, I worked 2 and sometimes 3 part time jobs while in school. When I graduated I pretty much started graduate school right away and also started working full-time downtown. There was never enough money and I did some crazy stupid things like taking out a cash advance loan because I couldn’t make ends meet. My 20s were a spiral of student loans, spending on credit cards sometimes for necessities and other times very foolishly, and being constantly all but broke. By the time I was in my 30s, I was finally making MUCH better money and starting to be able to dig myself out of debt. I still had insane spending habits. I would search out ways to get out of debt but never commit to anything. I read Jerrold Mundis over a decade ago, and nobody has really said anything new since his book.
THAT was when my layoff happened. The layoff was my wakeup call.
Post-layoff, I found Dave Ramsey. I read his book and listened to his radio program daily for about a year. I started doing a monthly budget and started getting my spending under much tighter control. At first that was all I could do. Then I started to be able to make more than minimum payments, and to get my disastrous 25% interest rates lowered. I’ve been working on all this seriously for the past 2 1/2 years — I’m finally starting to see some real progress and it’s been an ongoing battle with myself.
I just found personal finance blogs about 2 months ago — I don’t even remember how except I knew they existed and went looking for them.
db
http://www.debtblitzkrieg.com
March 19th, 2007 at 8:48 am
I have always been obsessed with earning my own money and paying things off. When I was a child, I would take toys and things from my room that I did not want anymore and set up a “yard sale” in my kitchen so my parents and grandparents could buy my stuff. I pay on my student loan weekly. By doing this alone, it will knock off a good 7 years of payments. And I am constantly analyzing my financial data. I am facinated with numbers. Suze Orman comes a close second.
March 19th, 2007 at 9:55 am
I hit 30 years old, looked around my money world, and didn’t like what I saw. And the prospect of becoming a daddy for the first time didn’t help my anxieties, either. (I was interested in investing years before this, but the ‘get out of debt’ journey didn’t happen ’til later.)
March 19th, 2007 at 3:27 pm
When I started my first job, stopped living off of my parents and got married — all were within a 9 month period. We didn’t make a lot of money, but had a large rent (by choice). So budgeting was necessary. And, thanks to our wedding, we happened into a bit of money … and needed to know what to do with it.
March 19th, 2007 at 4:18 pm
Lots of great response, many of them varying too! It seems there are quite a lot that has always cared about their finances (which is awesome, by the way). I still haven’t fully (& carefully) read through all the comments yet; so if you haven’t share yet, feel free to!
Note: Just because I didn’t directly respond to your comment does not mean I didn’t read it.
March 19th, 2007 at 5:50 pm
“Personal huh….?
March 19th, 2007 at 5:53 pm
It wasn’t until I got some money that I got interested in it.
I was suuper poor all through college, I had a baby in the middle of it, got a full time job after school, bought a house… I never carried any debt or anything… I put into my 401k and saved and whatnot… but I wasn’t interested in finance until I got married and all of a sudden we had to houses and tons of money coming in. I sold my house and got a large amount of money that I had to figure out what to do with…
March 20th, 2007 at 4:03 am
I started getting truly concerned about the hole of debt I had been digging myself into for years just in the last few months. It started with reading a few personal finance blogs, here and there, until I realized I was adding blogs to my bookmarks and checking them many times a day.
Buying a house last year has also been a motivator. And really, it just seemed like it was time to own up to past mistakes and work on correcting them.
March 20th, 2007 at 4:44 am
Graduated with my PhD in 1996 and was deep in debt & broke. The last two years before graduation was spent avoiding collection agents and selling blood. I even owed 1000’s of dollars to my close friends on top of credit card debt & student loans. I suppose I “cared” about personal finance then but only to avoid it!
But then I got my first real job (in my field even) and with my first paycheck I wanted to pay off my debt (at least to my friends). I was so helpless with money I could not even do that so one of my friends suggested that I get debt counseling (at Consumer Credit Counseling). I did so and it opened my eyes to budget basics. Budgeting came easy once I paid attention. I found money to pay not only my friends but also all my other debts (most which had gone into collections). Then I saw one of the Gardner brothers on C-span (press club) and that led me to the ever-increasing on-line world of personal finance. Just recently I have really started to read the pf blogs.
So today, 11 years later, I live well below my means, am debt free except for a modest mortgage, have ample credit, have substantial investments in individual stocks & index funds, and a solid cash reserve and am looking at the ability to retire early at age 50.
So I really got the importance of personal finance when I left the university and discovered that me being a deadbeat was not hurting some faceless/souless company but rather my very real friends. I am so very glad I paid my friends back…and yes, even those big companies too.
They were good friends…..and still are!
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Great story Mr.eh! Glad to read that consumer credit counseling helped you out, apparently they are one of the better debt consolidation/counseling service out there. Your friends do sound a great bunch too, especially since it seem like they care more about your financial well-being than getting their money back.
March 20th, 2007 at 8:00 am
Became more interested in my finances after I had my daughter, with my husband not working (and me being the sole income) and slowly going into debt by 500 monthly. I suddenly became involved in lots of 0% credit card offers and started to understand that money is a tool (even a tool that you can use when you need an extra $6K a year to get by). While I was never broke (I do have lots of retirement savings, which lets me sleep at night), I was getting more negative by the day.
The answer, of course, to my problems, was for my husband to get a “real” job (he had his own business) and we have been digging out of the CC debt for the past year and a half. I now owe out only $5K (and I’m doing some 0% magic with another $5K as per Jonathan at mymoneyblog.com), and have plenty of income. I’m looking to learn more from all the good advice out there so that by the time my daughter starts school, I can have a type of job that lets me spend all holidays and summer vacations with her. That’s what I’m shooting for now.
March 20th, 2007 at 5:53 pm
I too had a rude awakening. My wife wanted to file bankruptcy but I was dead set against it as I incurred the debt and I was responsible for paying it off. I had to get a handle on things to know what credit accounts I had. I developed an excel workbook with a monthly worksheet that had the account name, account number, type of credit card and contact information. I also had to identify what I owed, the statement’s minimum payment required, the interest I had paid during the prior month, the rate of interest (percentage) I was being charged and my credit limit for each account. I also threw in a priority column and some computations as to how close I was to the limit, the amount on each account available for use and percentage indicator as to how close I was to paying off the account. I then totaled each column and was shocked to find that I was nearly maxed out on several of the accounts. I almost fell over when I totaled the amount of interest I was shelling out each month. And even more surprising was the unrestrained interest rates I was being charged each month.
Account Name ACCOUNT # CARD TYPE TELEPHONE # AMT OWED MIN. PMT. INTEREST Finance LIMIT Priority % of Limit % Available % Avail. Est. Payment
Charge of 5% of Amt Owed
After gathering information and tracking each account, I was able to tackle the higher interest rate accounts in priority order from the greatest interest rate to the least. Firstly, I stopped buying crap and charging it. I eliminated the accounts with the higher interest rates and proceeded to the next highest rate. All the while, I was making slightly above the minimum monthly payment required on each account. Once I eliminated the higher interest account for the next month, I would take the amount of the payment I had made and combine it with the minimum payment due for the next highest interest account and before long that account was cleared and I would take the monthly payments on the two cleared accounts combine the amounts and apply them to the next highest interest rate account. And, so on.
No, I am not totally out of debt but, I am well on my way and I can actually see progress from month to month using the workbook. I guess from all this, YOU need to get control of YOUR spending, know where YOUR money is going.
March 20th, 2007 at 8:30 pm
i started caring about money when i filed for bankruptcy right after college. i had an excellent salary right out of college, but racked up so much debt in college thinking i’d pay it off when i got out. it’s not easy to pay of $30K in debt on a $58K salary. the market fell out after 9/11, and my salary decreased. at least for me it decreased since i had budgeted in those quarterly bonuses. i was young and stupid. my credit cards raised my interest rates, tacked on late fees, my car got repossessed. finally, i gave up and filed bankruptcy. i thought i’d never be able to buy a car or house again, but i had no choice.
so after going through bankruptcy i decided it would never happen to me again. and, i realized that all the money i put into nortel stock was trashed after the market fell out. i’d always believed in saving for retirement.
so, i’ve been working really hard the last five years to increase my salary so i can have a nice life and save for retirement. my husband and i make good money. i think i really started caring about money when i realized that we will have to fund our retirements, and i want to be sure i’m putting my money to good use.
i stopped here more for investing advice, but i found the blog funny so i kept it.
~cindy (30)
March 20th, 2007 at 8:55 pm
for Margo..if you know you’re going to have to pay support for your mom you might consider signing her up for long term care insurance.
March 21st, 2007 at 6:14 pm
My parents never seemed to have money. My dad was self employed most of his life and never had any retirement savings. I started caring out of a desire to someday retire my parents. Hopefully I’ll make a little for myself along the way.
-limeade
http://fiscalmusings.blogspot.com
March 22nd, 2007 at 7:42 am
I’ve always been kind of a natural saver–my parents paid my full way through college, including living expenses, but I still had a part-time job and saved my paychecks–but the PF bug really bit me this fall, when I started setting up my post-graduation life, with an apartment, and a job, and the whole grownup deal.
I was reading MSN Money, and one article featured a link to Madame X’s Open Wallet, and given her extensive blogroll, I was totally hooked. I read for a couple of months before starting up my own blog, which I think has organized my thinking about personal finance and allowed me to set some concrete goals.
March 22nd, 2007 at 3:43 pm
I can’t afford the premiums for LTC insurance for my mom right now, not when I’m saving up to go back to school. Plus, I’m also concerned about the ‘healthy enough to live alone, not healthy enough to earn an income’ phase.
March 25th, 2007 at 6:23 pm
I only recently became interested in personal finance. After incurring no debt through all of undergrad, I was accepted into my dream grad school with a two year deferral. With a price tag of >$50K a year, I’ve suddenly realized that debt is going to be a very real part of my life for the first time ever. With that in mind, I’m trying to save up as much money as possible before tuition bills start coming in to reduce the amount of debt I actually need to accumulate. I understand that educational loans are “good” debt, but going from $0 to $100,000+ in debt is still scary.
March 25th, 2007 at 7:47 pm
I started caring when Husband decided after 25 years it was time to retire from the Marine Corps. We had always talked how when he retired, I’d work in a career field I loved for at least 10 years, then think about retiring myself. We’ve been living in military housing (yuk!) and have mused about that dream house we wanted. We also decided that I would quit my job and move to where we were going to retire to start job hunting and house hunting about 3 months before his retirement date. I have always kept my CC debt separate from his so I sat down one night to total up my debt and nearly freaked out when I saw it was close to $30K. I am determined to pay as much as I can toward it by August 31, 2007.
March 30th, 2007 at 6:56 am
hi! i had just borrowed $6000 from my mom, with the plan of quickly paying it off… i paid $2000 within the next few months, but then she was diagnosed with cancer. At the same time, the entire industry of my self-employment changed… so i was taking days away from working to go to the hospital, etc. while my days AT work were very unproductive. All of a sudden, a year later i owed $10,000. I actually broke up with my boyfriend over it because i felt it would be totally irresponsible to enter a relationship owing so much money! Anyway, i even took a job at Pier 1 just to feel secure that at least i would get a Regular check every week, no matter how small. In another 2 years my job situation got better, but i still was owing $15,000 after having to purchase a used car on top of the debt!
So, needless to say, i had spent already 5-odd years, and the debt had only gotten worse, not better, after focusing on clearing it up! And that was after switching to 0% interest cards!
That’s when i started googling information on saving money. I think i fell upon “Savvy Saver” first, but honestly, your blog came up on a search, and i dug the name SO much! The particular entry intrigued me, discussing how we buy so much *C* from all over the world, but none of it is of any value. So then i started on focusing on Net Worth. And everything changed.
Thanks for being a part of my life! I am now debt free (after 3 years of working like a dog and spending NO money), have an excellent credit score… and feel great! The scripture that says, “The wicked one is borrowing and not paying back,” really made me realize that hey, i “borrowed” all this money from the credit card companies, and i should pay it back to them with the same conscientiousness that i would pay a friend or family member back.
It can happen to any of us, i realized that, too, because i always regarded myself as pretty good with money. I had never been in debt until 26 years old.
Long story long… :) I came to enjoy all you bloggers… Savvy, Madame X, FMF, SBC, mapgirl, S&B, ELYM… You guys are great, and responsibly educate many a person in trouble. Keep it up!
April 5th, 2007 at 4:54 pm
I started when I was 12. I started working for my parents company & my mom would only give me 1/2 of my paycheck. I never really cared all the much & really liked the money when I graduated high school. – Now… I still try to save 1/2 my money now. – Garry