I have been asked to reflect on my 20’s for what I did right, and what I could have done better with my finances.  Let me first say currently I’m 32, so I am not very far off my 20’s.  My body tells me that I’m not in my 20’s anymore, but my mind is still sharp and I am finally doing things I have dreamed about.

I started off my 20’s in England doing Discipleship Training School with Youth with a Mission.  I had raised money and used that money to finance my trips.  At the time I was not great at budgeting, but I knew how to save.  If only that kept up.  When I came back to the states I found myself not doing anything.  My dad said I either needed to get a job or go to college, which ended up being a very good kick in the pants.  My mom found a scholarship for me to apply for, which got me to college.

During college, to pay for room and board, I took out loans.  This equated to a lot of money, read my previous post for more specifics.  Also, I had credit cards, and was amassing debt.  I thought I knew what I was doing.  It was only a small payment.  I then started to struggle with paying the credit cards, and transferring balanced around to make payments.  During this whole ordeal, one year I had some extra cash from my student loan.  I thought I’d throw it in a CD for 6 months.  Brilliant!  I got a very small percentage, don’t even remember what it was, with a 5% interest on my loan.  Oh by the way, I was also accruing interest from the credit cards.

Eventually I cried for help!  My parents came rushing in to pay off all my credit cards, though I had to make monthly payments to them.  I was very grateful for my parents.  I could not have dealt with that craziness during college.  Did I learn my lesson though?  Only for a short time! 

Upon graduating college, I got a job with a Fortune 100 company.  Blessing, you betcha!  I made good money for a recent graduate.  I rented my first apartment, cooked my own food, and dealt with my finances.  I tried to budget using Microsoft Money.  I couldn’t stick with it.  I bought a used SUV, 2005 Mazda Tribute, and started accumulating some credit card debt again.

I thought I had everything under control.  I was making payments just fine.  Though, one thing lingered over me.  I wanted to marry my now wife.  I didn’t want to go into the marriage with credit card debt.  I wanted to be debt free.  So, I scheduled a meeting with an Ameriprise financial guy.  He looked over my income and expenses and said that I was better off than a lot of people.  I actually had money to spare!  I didn’t even know it!  After the consultation he told me there was a fee for continuing to use his services.  Well, I didn’t want to pay the fee.

What did I do then?  Well I bought a new TV with an HD-DVD player.  Stupid, right?  We got married, and thanks for all the family for the expenses of the wedding.  Neither of us knew how to control money properly.  We replaced my wife’s car with a 2008 Honda Accord, used, and racked up some more credit card debt.

Arguments started becoming more focused on finances.  We had over drafted twice, which usually I only did that once per year, and we came to our senses that we really didn’t know what was going on.  Early in 2013, we had an argument about finances again, and I finally said “You know what!  I was a business major.  I can create a ledger to track out expenses and forecast our cash flow!”  That’s what we did!  For months we tracked our expenses and income, moving around payments to make sure we didn’t overdraft.  That August I took Dave Ramsey’s Financial Peace, which introduced me to a budget that wasn’t complicated, retirement, and a bunch more things.  I also worked with a guy who was very good with his finances, and got me on the right track.

With all that said, if I could go back and change something in my 20’s what would I change?  First, I would see if there was a way to work instead of taking out student loans, or building credit card debt.  If I was graduating today and already had all that debt, what would I do?

The advice I heard, and didn’t heed, was when you get a job, live like you a poor.  You will have extra money.  I would have used the money to become debt free, and then invest in my retirement.  I would learn how to budget.  For me, and the way it should be, is design a budget that fits YOU.  Look at my budget post for more information.

If I was debt free, I would start investing in my retirement immediately.  The more time it takes for my investments to grow the less I have to invest initially.  It’s huge.  Just do some calculations on an investment calculator.

The things I am proud of during my 20’s are starting to get out of debt, investing in my retirement, and really starting to understand money.  I don’t blame anybody for not teaching me the ins and outs of money, and I have so much to learn.  Two years ago I made a goal of being a millionaire in 10 years.  Will I reach that?  Right now I’m not sure.  My focus is to get out of debt, and we are so very close. 

If I had to redo my 20’s, the thing that I would do is run away from debt.  Live like I was poor, and invest.

My plan currently is to get out of debt, build a 3 – 6 month emergency fund, save for a down payment on a house, if not save for a house, and then work on my retirement.  I want to be a multi-millionaire when I retire, and I believe I can do it.  When I finally retire, early or at the normal age of 65, I hope to be healthy enough to travel the world.  I want to visit as many countries as I can.  I don’t want to sit, I want to move.

If you are the least bit curious where you fit in this financial puzzle, check out www.personalcaptial.com.  They give you a free tool to show your net worth.  Much easier to read and not as much marketing as www.mint.com.  I have just recently learned of personal capital, so not familiar with how they make money.  Though, I find it much cleaner to look at everything at a glance.  Ultimately, though, I would still use my spreadsheets to track.  Tools are great, but do what makes sense to you.

Blessings,

Andrew Krob