I’ve always been a self-aware person. As far back as I can remember, I had the ability to take in everything going on around me and contextualize their meaning. I have memories from as early as Kindergarten where I recall knowing and understanding conversations I heard adults having about life. Money, relationships, friendships, and more–you name it, I “got it” at quite a young age.
It’s no surprise to me that I remember hearing about money from my parents quite early on. Let me rephrase that one: I remember hearing my parents talking about NOT having money early on.
My earliest memories of my mom’s job was that she worked as a manager at a gas station. She was the boss lady, but I knew that even though she was the manager, she still didn’t make enough money to support my brothers and me on her single income without help. We had help from my grandparents, occasional help from food stamps or Medicaid, and reduced or free lunches. My father was in and out of the picture, providing sporadic funding or help, but nothing very steady.
When I asked my mom what she remembers of her financial landscape when I was a child, she said that she remembers when she got a job after staying home with us when we were young.
She told me, “I decided to stay home with you kids while you were young, with the help and support of your Grandma and Grandpa. When I finally decided to go back to work and get a place of my own, the government help stopped. Food stamps cuts you off, and as much as you try to get ahead, when you’re just above that threshold, you are just always waiting for your next check to make ends meet.”
I’d consider my mom to be one of the best mothers of all time, so I am not saying any of this to discount her or her experience. My mother might possibly be the hardest working woman I know, and she got it honestly, as her mother was equally hard-working. Both have had long careers in manual labor at local factories.
She gave me sound financial advice, but not advice that helped me financially thrive, and that’s because it was out of the norm or realm for her and the financial state she was in.
My mother’s advice was simple: don’t get a credit card and keep track of everything. I didn’t listen to her initially, I can tell you that much.
When I went to college, I got funding from grants and scholarships, but my family didn’t have money to support me as I was out on my own. My college classes and housing were covered, but I didn’t come to school with a car, job, or more than $200 to my name. I didn’t run out and get a credit card right away. I got a job on campus and somehow made it work during my freshman year.
For my second year of college, I was told that I wouldn’t have full funding like I (thought) I did before. I searched and applied and prayed, but the money wasn’t coming. I had all but $1,000 and wasn’t able to come back for my first semester. I ended up dropping down to online-only classes. I had a hard time learning this way, navigating other life things and religious traumas, and quit mid-way through my second year as well.
Funding on My Own
Thinking back on the uncertainties and unknowns about college, I cannot believe I was left to navigate my funding on my own. I remember filling out FAFSA forms in my parents’ names, researching on my own, and calculating different grants and scholarships just to see what I could do. I chose a private school because I thought it sounded nice instead of going to a state college, where I likely would have had all four years covered. I had no idea, but neither did my mother, who never went to college herself.
After realizing that “school wasn’t for me” or more realistically, the hardship of trying to make school financially viable as an option got too heavy, I was ready to move on with life. I became a nanny, and decided I’d move to Indianapolis. I had a boyfriend here, but he was living with a friend, so I remember that I spent the first couple of weeks in my car. Without realizing it at the time, I was a young, homeless girl, staying with a friend here or there or sleeping in my car.
While I was rent free, I was able to save up enough money to get an apartment with a roommate…barely. My rent was $350 per month, my friend paid about half, and I still narrowly had the money for utilities, gas, and food. This apartment was a nightmare. Not only was it in an unsavory part of town, but the air conditioner literally flooded my living room, a man walked in (more than once) to steal my newspaper, and my brother called my parents crying from there to come pick him up because it was too scary.
One day, my roommate found me crying in a pile because I didn’t have the money to pay the light bill and hadn’t for quite a while. I just didn’t imagine the lights would get cut off, but sure enough–they did. I didn’t give up. I kept progressing. And I STILL didn’t have a credit card…because my mom told me not to.
More Money…You Guessed It, More Problems!
I ended up applying for, and landing, a job at a fortune 500 company in sales. I got a nicer apartment a block away from the scary apartment, and was working hard to keep moving forward. I was on the top of the world, but some of the things I had done in the past started to catch up with me.
A car loan I had defaulted on and not thought about since it was totaled came back to take money from my paychecks. My “free” college experience ended up not being free because I didn’t finish school or continue my education, so my paychecks were being docked by them too. I wasn’t able to afford my rent and my new car and some other things I had begun to afford with my better-paying job, so I turned to payday loans and…I opened a credit card. (Sorry, Mom!)
I dug myself into a rut, and it took a couple years to dig myself back out. When I finally did, I still wasn’t 100% financially secure, but I didn’t have anything pressing down on me like before. My student loans were (mostly) paid off, my creditors were all leaving me alone, and I was earning more and more money at my sales job. Was I tracking everything like my mom said? No. But I didn’t have a credit card anymore!
It wasn’t until I met my husband and started talking to him about money and finances that I realized I had been hiding from things and never setting myself up for a successful financial future. I made it my goal to get my finances right before we got married. I paid off collections that weren’t even stalking me yet, I made things right with old creditors like apartment complexes I didn’t pay or cell phone bills I had abandoned, and I trusted that things would just work out moving forward.
A couple years into our marriage, my husband and I realized that while we were doing fine and paying our bills, that we let our “newlywed” status take over. We were eating out too often and shopping too much. We had some situations that led to us paying for more of the wedding than we anticipated and we put our honeymoon to London on a credit card. We were going down a path that I didn’t want to take the time to correct. So I didn’t.
A couple years went by, and we were still living from credit card payment to credit card payment. We’d pay them off, fill them up, never miss a minimum payment, and never miss a chance to spend money on a weekend road trip, cash out for casino funds, and so many things we didn’t need at discount fashion stores and outlets. It wasn’t until I was laid off from my newspaper job, took a life break, went back to work making way less than half of what I used to, and realized we needed to figure out our finances that I got serious about our future and finances. (Spoiler: I wanted a baby!)
I decided to track all our spending, confront all of our bills, and work toward becoming debt free. I remember bringing all my research and ideas to my husband. He seemed hesitant, but told me he trusted me. We began to work on things together.
We paid off small debts first, gave ourselves monthly allowances of $10, and spent $200 or less on groceries each month. Every extra penny we had leftover in a month, we put toward our debt. This low budget way of living started snowballing. Every time we paid off a debt, we had more money to put toward a bigger debt, and before we knew it, we felt comfortable to start trying for a baby. We had our first, Clara, right before we paid off all our credit card debt. It took 1.5 years to pay back $25,000 in debt. In the meantime, we also paid close to another $20,000 alone in interest charges. We were working double time to make sure we could get that debt paid off.
Let me break this down for you again. My husband and I were making around $75,000 per year and we paid off over $45,000 in debt and interest in 18 months, all while having a baby. We currently only owe for our home, one car, and a tiny bit of medical debt that has 0% interest.
Have you ever worked so hard toward a goal that when you’re done you feel lost? I initially felt that once our debt was paid off. I was looking at an extra $800+ per month we were not used to having, and I needed another goal ASAP. We decided to start saving for our future, setting our life up to feel comfortable, raise a family, and support ourselves and family into the future.
Within the next year, my husband and I saved for a 6 month emergency fund. And then Covid hit. We were fine, financially, and luckily we didn’t have any loss of income during the pandemic. We both switched jobs, make more money now, and even added a couple more children! (Twins. It wasn’t in the plan, for life or our finances, but Pierce and Beckett add an extra pizzazz to our lives we’d be lost without!)
We have set ourselves and finances up to simply not worry about how we will pay for something. We are not rich by any means, but we have afforded ourselves the ability to be a month ahead on all our bills, have 6 months of funds saved, fully open credit, plenty of equity in our home, savings for our children, the ability to do renovations on our home and pay cash, take vacations and more.
We do all this with still very modest income, although it is more than when we started our debt-free journey with. We just minimize excessive spending, stick to a budget, and plan accordingly. It’s such a drastic difference from what I was taught growing up, but we make our credit work for us. What’s not so different? I track everything. Thanks for instilling that habit in me, Mom!
When I think about the impact I want to leave on my daughter, a million things go through my head. I never want her to take anything for granted, but I also never want her to feel like she doesn’t have enough. I want her to know how hardship feels so she doesn’t make mistakes, but I also want her to live and experience her own financial ups and downs.
What am I doing to help set my daughter up for success?
I am saving money for her. No, this isn’t a “wedding” or “college” fund. This is a fund that can be allocated toward whatever she, as an adult, feels like she needs the funds for.
I am talking with her about money early and often. She’s 3 currently, but I still have her talking about saving money, how much we spend on everyday needs, and treating yourself to something special every now and then.
We try not to talk about things that could make her nervous, but try to be open about finances overall. Sometimes conversations (like I heard as a kid) can lead kids to worry, because they don’t realize it’s just everyday chatter and deciding where funds come from, when, and how. But talking about working extra to make more money, spending money that was unexpected, and saving can help children understand that it’s not all buying fun things every time you have extra money.
I plan on talking to her about how strong my mom and grandma were. They truly impacted me, my sense of worth, and never let me doubt for a second that a woman can’t be a hard worker or money-maker.
We will allow her to have spending money, but also work to earn additional money. You need new school clothes? I got you. You want a ridiculous brand name t-shirt that costs $80? You can spend your earned money on something extra like that.
We’ll be able to talk to her about big financial decisions, like college or other loans, so she doesn’t have to learn about them by defaulting on a loan. I’d save her from these big mistakes I made every single time if I could.
I’ll do what I can to help set her up with a car, anything she needs for a first apartment, money so she can continue her education, etc. I truly feel like the lessons I learned on my own made me who I am today, but because of those lessons, I will gladly teach my daughter about the things I learned and hold her hand and help as much as I can during the hard years as she becomes an adult herself.
I’ll specifically talk to her about how having money as a woman can be empowering. I don’t plan on spewing the “save a secret stash of money” rhetoric, but will definitely share that having money talks and being on the same page is important in future relationships, and even friendships.
I’ll mainly just let her know that I support her. I have experience ranging from being in heaping piles of debt or being homeless on the street to being debt free or financially stable with savings and investments.