Pizza is Not an Emergency, and Other Personal Finance Lessons I Learned the Hard Way

So, real quick, before we get started:

What this is: 
One human's unique personal life experience with money over the long haul.

What it is not: 
- A list of tips & advice for obvious money saving techniques (aka-"stop going to Starbucks so much!");
- A get rich quick scheme or advertisement for any particular money saving strategy; or
- Humblebrag about a "hashtag-blessed" life.

I entered college in 1998, the only child of two great parents who were blue collar factory workers in rural Missouri.  My folks didn't impart much money-knowledge on me, but they taught me how to be thrifty, have a savings account, balance my checkbook, work hard for the money that I get, and never burn bridges.  And that's about it. I didn't have a finance class in high school (or college), nobody taught me about loans or credit scores, taxes, 401(k), etc. I'm pretty sure I didn't even have a debit card at that point.

Junior prom: young, innocent, and completely unaware of what "compound interest" is.

So when I went off to college, I, like most college students, was inundated by credit card offers.  They showed up in the mail, and there were booths scattered across campus offering free t-shirts in exchange for filling out an application. Stupid Me thought, "hah, they'll never approve me, so yeah, I'll fill out your form and get a free shirt!" 

And then...the credit cards arrived.  Small at first--my first card only had a limit of $500.  And I said, "I'll only use these for emergencies."  And that lasted about 6 months.  Because to an 18 year old, pizza can be an emergency.  By the time I graduated in 2003, I had over $15,000 in credit card debt, a high interest $2,000 "rent-to-own" loan on a crappy laptop, a $4,500 car loan, $1,600 in "Stupid Tax" I'd accumulated by paying bills for roommates that never paid me back (despite taking them to small claims court), a judgment against me for a card I'd defaulted on, a credit score in the 500s...oh, and of course, now $25k in student loans that I needed to start paying on.  

Note: I went to a state school so my tuition was pretty reasonable, and my folks pushed me to apply for scholarships and fill out my FAFSA. My parents told me to "only take what I needed"--so each semester I only took out a subsidized Stafford loan which covered my books & tuition with a few hundred bucks leftover. My student loan debt could have been WAY worse if they hadn't given me that direction.  I worked through college to pay for rent and living expenses (usually 2 part-time minimum wage jobs at a time: errand runner, pizza delivery, retail/cashier, bartender, photographer for the student paper, etc.). Because I was working, I took a smaller course load (~12 credit hours) each spring & fall, and then also took summer classes.   But in retrospect, I wish I would have known more about community colleges. I had a really snobbish opinion about 2-year schools as a young adult, but I wish someone would have told me that they're a great tool for knocking out gen-ed classes at a deeply discounted rate.

After college, a coworker introduced me to Dave Ramsey's radio show (while I was working my second job as a pizza delivery driver, because surprise surprise, entry level jobs, even in your career field once you have a degree, still don't pay that great). I started my Debt Snowball, and threw every extra penny (after rent, utilities, groceries, and a little bit of pocket cash) at my debt. And I made a lot of headway in that year.

But then, I decided to move to Louisiana for grad school in 2004 (more loans & out of state tuition), had a bad breakup with a live-in boyfriend (so now paying all of the bills instead of splitting them), and lost my job and graduate assistantship to Hurricane Katrina in 2005 (buh-bye savings).  Back in the hole I go.  

Eventually I got a new job, graduated, started the cycle again. Lived on a cash budget for a while.  But in 2008, I decided that because I'd gotten a promotion at work and had the word "manager" in my job title that I needed a nicer car.  Got $15,000 in car loan debt with a high interest rate (because of my crappy credit score, then somewhere in the low 600s).  But otherwise, continued to live modestly and pay down the debts.  I can't say I had the best money management habits, though--I dined out for lunch with coworkers most days of the week and did my share to keep coffee shops in bankroll.  I was also horrible about keeping track of how much I had in the bank, and at one point had EIGHT overdrafts ($35/each) in one month.  Probably for purchases that were about $10-15.  Stupid.

In 2009, I finally paid off all of my debts except the car and the student loans. I decided to move back to Missouri for a job that paid less, but allowed me to be closer to my family.  I started dating a really nice guy, who was actually great with his own money, and who inspired me to be more responsible with mine.  He also inspired me to start tithing, which I know seems contradictory to throwing all your money at your debt, but I decided to go by faith....and got a promotion/raise at work not long after, so I 100% believe that's a God-thing.

At the 2011 World Series, Game One. Go Cards!

Then the nice guy proposes (in case you haven't figured out, this is now "The Hubs"), and we decide--we will pay for our wedding and honeymoon with cash, no credit card debt. Which we did.  And I also managed to pay off the car that year (2011, so 4 years after purchase).  Then two become one, and I moved into the modest 3BR/2BA house he had bought in 2004.  So now we share a joint bank account, his mortgage, and my student loans.  We made a budget (which included some monthly allowance for personal spending), and then we started throwing all of our extra money at the student loans and mortgage.  We still liked to dine out a couple times a week, and hang out with friends every Wednesday to play trivia at a local pub, go to the movies, and travel a bit, but otherwise, we lived pretty cheap. 

In 2012, a horrible tragedy... my aunt was killed in a car accident.  My family was devastated and completely caught off-guard.  My cousin & I decided to step up and become the executors of her estate, because our aunt didn't have a will and our parents were grieving and shouldn't have to think about money and all of the stressful little things that come with a horrible event like that. Unbeknownst to us, this Aunt had a life insurance policy...listing me & my cousin as beneficiaries.  As her executors, we used the insurance money to pay for legal fees, funeral expenses, and her outstanding personal debts, and after everything was said and done, had some left over.  I used part of my share to pay off student loans, we used another portion to pay down our house, and then the rest we put into savings until we could think of something to do that would honor her memory.  While I would rather have my aunt back than even a million dollars in the bank, I'm including this bit because that "inheritance" played a big role in our finances. 

Me & my cousin with our Aunt at her wedding in 1995. We miss you so much.

Later that same year, the owner of my company passed away in a plane crash...2012 was a really rough year. So maybe the Mayans were a little right.  But these things inspired us to make sure we had a will in place, because life is short and you really never know what could happen.  On the flip side of that--we paid off our house AND my student loans by the end of the year. But it was very bittersweet.

In early 2013, we had some savings amassed from being debt-free, so we decided to invest--in ourselves--and buy a business. We bought a small ice cream shop that was sold to us as a "great seasonal absentee-owner opportunity for side income" (this is HILARIOUS now).  We committed to a 2 year lease, paid for the business with our savings, and never had any debt on it.  Running that business was the most stressful time of my life (we were both still working our regular full time jobs).  It definitely wasn't a cash cow (and the "side income" didn't really off-set all the man-hours we put into it), but we learned A LOT, and we both have a much greater respect for the small business owners of the world.  After the 2 year lease was up, we sold the business to friends who are veteran restaurateurs in this area, and they've transformed that location into a hugely successful restaurant...which is a little bittersweet, but I'm glad for them.  The money from the sale of the business went into the stock market, retirement savings, and savings for fertility treatments, with the remainder to eventually go into a college savings plan for our (hopeful) future kid.

In late 2015, after 2 years of trying, we had our son--I was 35.  Since he was VERY much planned, I'd been working on a "baby budget" for years. I knew how much day care would cost, and what the best price point for diapers was, and had short-term disability coverage to help with lost pay during maternity leave.  We were incredibly blessed with hand-me- downs from friends and family, so his first year of life cost us very little (other than sleep, our sanity, and my ability to not pee when I sneeze.)

Now...here we are.  In our late 30s, "old but experienced" parents, but incredibly blessed.  I have a 6 year old car, purchased with cash, that runs well (despite having over 180k miles and the imprint of a deer on the passenger side).  We moved into a bigger house in November of last year, and between savings and a 401(k) loan (that we paid off once the old house sold) were able to buy the new house without a mortgage.  We have good paying jobs (for this area), but it took over a decade of work experience each to get to that point.  Lil' Man's day care is our biggest monthly expense (day care is stupid-expensive).  Since we have no debt, The Hubs & I max out our retirement contributions each year, contribute to a college savings account for the Kiddo, and I've recently started maxxing out my Health Savings Account (HSA) as well, which we can use down the road...because we'll almost be senior citizens when our kid graduates from high school, so we'll likely be falling apart and in need of new bionic 3D-printed body parts.  We also still tithe and donate, because we are supernaturally blessed and believe we should give back generously.  That all means that we still live very modestly--living on about 20% of our gross income for our 3 person family.

I don't dare take credit for this.  I KNOW I've been lucky. I believe my life has been blessed in supernatural ways. I hate that part of the reason we became debt-free when we did is because I lost someone I loved.  Yes, I've worked hard, but that's only a small part of this equation.  I married someone who was good with money.  We had a lot more to throw at our debt because we waited so long to have children. I've always lived in relatively "cheap" areas of the country (except the year in New Orleans, but it WAS considerably cheaper before Katrina than it is now). And there's the whole inherent "white privilege" thing. My situation is very unique.  And I know it can all change in a matter of seconds in the future.  But I'm no less grateful for all of it, the entire experience.

And honestly, I'm really proud. To know where I was 15 years ago, I honestly thought I would just always be broke. That broke-ness would just be my lot in life, because that's all I saw around me--everyone was broke and in debt.  Debt was normal.  Which sort of made it seem okay...sad, but okay.  Now, I can see how hard I worked, and that it didn't happen overnight.  It sort of snuck up on me.  And that's pretty amazing.