My financial history is not nearly as exciting as my parents’. They finally got everything pulled together when I was in high school. We moved to an affluent area with better schools and less crime. My sisters and I performed better there because being smart was a point of pride instead of being something one could be teased about. There was less pressure to drink and take drugs (and we were only like 13 or 14 at this time!).
My sisters and I worked over the summer starting when we were about 16, the kind of jobs you get in high school – working as cashiers, as waitresses, as Sandwich Artists at Subway. This money could be spent on whatever we wanted. I still remember saving up nearly $500 for a field hockey training program (with coaches who had played in the Olympics), but never being able to go because my parents couldn’t drive me. The rest was frittered away on pizza and movies. Besides the general discomfort that comes from being pretty solidly middle class in a town where most other families were wealthy, I didn’t think much about money until I went to college.
Freshman year was all about balancing meal plan points. I hated the dining halls, but with only a minifridge and a microwave to use for cooking, I wound up buying a lot of prepackaged food (EasyMac, anyone?) or sandwiches at the deli. Looking back, it would have been smarter to eat at the dining halls, where meals only cost $2. Near the end of the school year, I ran out and ate nothing but Ramen for the last few weeks of school. Can’t beat 5 meals for a dollar!
My sophomore year I moved into an apartment with a friend of mine. She had always been a little uptight, and I think I knew – even as I agreed to move in with her – that things would end badly. She would go food shopping (without me!) and buy nothing but SmartOnes meals and diet soda and would sneak magazines into the cart and make me pay for half. She was on a diet and would eat the meals, or nothing. Later, once our situation deteriorated, she would accuse me of eating everything she bought. Which may have been true. The only food we had was those meals, so I would eat one for dinner every day. This, apparently, was more than my fair share.
This was the first and only time I ever overdrew my bank account. Her parents kept checks I had written at the beginning of the fall semester and cashed them around Christmas. I didn’t track anything at that point, so I had assumed things had gone through and the balance at the ATM was mine to spend. I wound up using most of my Christmas money to cover the negative in my account and the overdraft fees, and I still remember how awful it was to see $250 dwindle to less than $100.
In the end, that was all the lesson I needed. The next school year, I made sure to keep a buffer of about $500 in my bank account, and I tracked my balance in a simple spreadsheet. I managed to keep the buffer in there for 2 years, no mean feat when beer money ran short at the end of the semester.
The worst time for me was after I had graduated from college. After 4 grueling years, I wanted time off. I got a job offer in June, and pushed my start date until the end of August. How did I finance my lovely 2.5 months of vacation? By signing up for a credit card, of course! I was not completely stupid; I was approved for a card with 0% interest for over a year and I took it. The card financed some new clothes for work, a mattress, and my many trips to see friends on the East Coast before I moved to the other side of the country. I was able to make the minimum payments with the small amount of money I had, and I reasoned that as soon as I started working, it would all be paid off.
When I moved out to California, there was a week before I would receive a moving stipend and two weeks before my first paycheck. Oops. I also had to buy a car, and although I still think that buying new was the best option for me (I know nothing about cars), I should have searched around for financing. Toyota gave me 11%. Ouch!
I survived by stealing yogurt from the breakfast at my hotel, and luckily there was also a “happy hour” in the evenings (with free food). I substituted the pizza and chicken fingers for my dinner.
Even once I got my first paycheck, it was very quickly gobbled by a security deposit and rent on my apartment (bless my landlord’s kindness, she took my checks and waited two weeks to cash them, which gave me some breathing room), credit card payments, a car payment, security deposits at utilities, etc. It wasn’t easy in the beginning. I paid the rent -$1350, more than a paycheck! – by myself for several months. It was touch and go (although at least I was putting into the 401K) for a while, until Chad got a job offer and was able to move in.
I was lucky, I think. That my job offer was such a good one, that Chad was able to move in and help with the rent, that nothing horrible happened to disrupt the delicate balancing act of my financial life. I paid off the credit card before the interest kicked in, about $4500, and paid of my car loan at the end of 2007 (I also had refinanced through my company credit union). I still have about $15K in student loans, but they’re in deferment now while I’m in school.
I still remember how elated I was when I had $50 left over at the end of the month. Now I push myself to save $1500. If that isn’t a success story, I don’t know what is.