I was always somewhat financially responsible, I guess it was something my parents drove into me. I had a job through high school and didn’t manage to get into a ton of debt early on. When I left for college I had financial aid and scholarships that made a relatively expensive school possible with minimal student loans. My first personal finance mistake was buying a car I thought I had to have, with no job. I figured I could find one easy enough in the big city I was now living in (I’m from a rather rural area) so I talked my parents into co-signing a loan for the fairly reasonable priced but perhaps maybe unpractical car and it was mine. After a few months of pulling together what I could to make payments (and an embarrassing month of having to ask my little brother to spot me some cash for a payment in exchange for being allowed to take the car to his prom) I got a job that I kept through college that helped me pay for most everything including the car, eventually graduating from a nice college with affordable student loan debt.
Buying the car might have been my first mistake but it wasn’t my biggest. During college I was required to spend some time in an internship. I was lucky enough to find a paid one and made twice of what I was used to. During this I started a side business so the money was rolling in, or it at least seemed to. Still being relatively young I wasn’t focused on savings and instead dumped it all into the modifying that car. I threw a bunch on the credit card with the belief that “I’m eventually going to buy it so why not charge it” (big mistake number 2). When the internship was over I still had a decent amount of credit card debt and, since I only had another semester of school to finish didn’t go back to my old job and instead relied on my side business. I was making OK money but the business wasn’t taking up enough time to prevent me from taking on the old job again.
I owned a business, of course I had money for everything. I held that thinking through the last semester of college and a few months before getting a real job. The biggest mistake I made was not separating business and personal accounts and not keeping records of what I was actually making. Yeah, I was making enough to live on but I wasn’t making enough to finance my credit card debt, my living expenses, and the fun that I could have when I had no real commitments. I was burning through more money than I was making and it was all ending up on the credit cards. Due to my complete lack of any budget (business or personal) I didn’t even realize it.
I still remember sitting at my desk and realizing this. Staring at the negative numbers that kept adding up for the past few months and a total credit card debt of well over $10k. All I had to show for it was a shiny sports car. I made a budget for the first time in my life and opened business accounts (bank and credit card) to keep things separate. I started keeping track of business expenses to make sure I was actually making money. I was on the right track and crawling out of debt, finally. Lesson learned.
Fast forward a few years and I was living with my girlfriend in a house I bought and had erased that $10k+ debt and built a savings account equal to it. I was doing well in my job and doing what I wanted as the money was there. I was saving a huge chunk of money monthly still and dumping cash into my 401k to max out my employers contribution. It was personal finance nirvana. However, the rest of my life wasn’t so happy.
Long story short the girlfriend and I broke up and through a whirlwind of months I was engaged to a new girl that I am positive is “the one”. During the break up I had to buy some things that were deemed as hers which she took so savings took a pretty big hit there. The new girlfriend and now wife was just finishing up her masters in education and had masters sized student loan payments with little promise of quickly finding a teaching job due to the horrible market.
Fast forward to now and we’re not broke, we’ve never had a negative month for as long as I can remember. It’s just tough looking back on what I had financially and trying to make it all work. I’m of course happier overall but the financial side of my life is where 90% of my stress is.
That long story leads me to here. I’m hoping this blog will not only help me get back on track but also inspire others to do their best to get their finances in order. I’ve read plenty of other personal finance blogs and although those guys who have it all together might know what they’re talking about it seems like they might have lost touch with the ones of us who are still struggling. I’m hoping this mutual struggle will help me help you (yes, I realize that sounds corny).