Personal Finance: Millenial Edition

Well everyone, I’m going to start writing a bit about personal finance. There is a lot of personal finance advice out there. Some is good, some is garbage. I’m in the process of cleaning up my own finances and wanted to give the perspective of a millenial navigating all this.

The Background

Well, let me give you an idea of where I started and where I am now. As of this writing (04 June 2019), I’m 34 years old. I graduated college (the first time) in 2007 – straight into the rescession. I got a job out of college as a high school history teacher and lost it at the end of the acadmeic year because my state changed their school funding formula, and my school eliminated 30-ish teaching positions as a result – including mine. At the time I had about $18k in student debt, and about $1500 in credit card debt. I had paid down about $2k of my original loan debt ($20k) during the year. I bounced around in part time work for several years. My savings was exhausted. An ill-advised attempt at grad school left me with no graduate degree, but $40k more in student loan debt. At the end of 2010 I was hitting bottom. I had no full-time work on the horizon, my savings were gone, and my credit card debt had grown to about $2500. Desperate times called for desparate measures. I enlisted in the US Coast Guard in 2011. I served on active duty for 7 years and left at the end of 2018. I’ve been living on savings again since, getting ready to go back to school (again.) While I was in the CG, I bought a car, increasing my total debt with an $18k auto loan. While I was in the CG I also paid off my credit card debt, paid my car loan off 2 years early, paid my student loan balance down to about $21k (near the original amount), and built about $35k in retirmeent savings and 3-months worth savings in an emergency fund.

The Series

Personal Finance: Millenial Edition is going to be a weekly series of posts about how I’ve been digging myself out of this mess. I’ll aim to have the posts online by 4pm every Tuesday. I’ll continue it until I’ve finished my story unless there are those of you with questions you want me to address. I have you some background above but I’ll go into more detail of what I did and how it worked. For now, I’ll introduce you to the two main systems I used to go from $60k of debt to $21k of debt and actual measurable savings, and how I’m navigating things going forward. I want people have a picture of how it actually looks to craw out from under a mountain of debt at get your financial ife in order.

The Sources

I’ve read a lot of personal finance over the years, but I really latched on to two main systesm of money management:

  1. Dave Ramsey‘s Total Money Makeover – This was the first real system of personal finance I was exposed to. I’ll say immdiately that I don’t like the blatantly Christian overtones of Ramsey’s work or his debt as a moral issue trope. That said, his steps are a good way to start thinking about personal finance. On his site under “Basics” the 7 baby steps give you the outline of the Total Money Makeover program.
  2. Ramith Sethi‘s I Will Teach You To Be Rich – Sethi’s book just came out with a 2nd edition this year, 10 years after his original book, and his website is regularly updated with new articles. He also sells courses on various topics. The book is updated to look at some of the issues and topics within the PF spehre that have developed in the last decade. Sethi writes mainly for younger people – 20s and 30s – but his Ideas are worthwhile for any age. I moved to his system when the Ramsey system stopped working for me.

That’s it for now. I’ll be back next week with the start of my story. My first full-time job against the background of the worst recession since 1929.