Sometimes people ask me how I got so interested in personal finance. We’ve all heard the old adage “you’ll never get rich in the military!” so why bother? And maybe I never will get rich, but that’s not what is important to me. What is important to me is having a simple, practical financial plan that works. I’ve discovered how to be free of revolving debt, maximize my retirement accounts (the Thrift Savings Plan and an IRA), and work towards my goals of financial independence and early retirement. And I want to share what I’ve learned with all of you on MilitaryDollar.com.
Starting out
If you read a lot of personal finance forums, you’ll often see people say “I was raised in a frugal household” or “I’ve always been this way!”
Let me tell you, that was not the case for me.
Growing up, my parents never really taught me about money. I knew we had some high-flying times, and also some very rough times, but since we never talked about money I never really understood what was happening. As it turned out, my parents were very good at making money, and even better at spending money. They never put much away into savings. They were very typical of their generation – living a fancy consumerist life on credit.
That’s the environment I grew up in. When I graduated high school, I had $1200 to my name. Right before I left for college my dad found a guy selling a junker used car and had me hand over $1050 to him, so I started college with $150, insurance bills, and an empty tank of gas. Not the worst financial status for a college kid, but not a particularly good start either considering I’d worked 15-25 hours per week for the previous two years. But hey, a high school kid has important expenses like fast food and movie tickets, right?
Oh, and I had a credit card. My parents applied for it, handed it to me, and gave me the first real piece of financial advice I’d ever been given. Are you ready?
Buy something expensive with this, then pay off the minimum each month. Make sure you carry a balance over each month. That’s how you build credit.
Yep. Yikes.
Learning a better way
I was very fortunate that I had enough from scholarships and grants to cover tuition and fees. I also worked most semesters in college. However, I took out loans to cover the rest of my expenses. After two years of college, deeply in debt from my student loans, extensive use of credit cards (I now had two, and *occasionally* missed a payment), and buying a new-to-me car for $6,000, I had a near breakdown when my parents came to visit. They were leaving lights on around the house, and adding snacks to my grocery cart, and I could just see money bleeding out of my bank account. I was panicking over maybe $20 of expenses. There had to be a better way.
I spent the next two years learning the basics, splitting my time between schoolwork, working 30-50 hours per week, and spending several hours each week reading everything I could find about personal finance. Dave Ramsey books taught me his envelope budgeting system. After college I would implement his debt snowball when I started paying off my debts (more on that later). Eventually I discovered the world of personal finance blogs and they changed my life.
It wasn’t an easy process. I made some mistakes, and I spent some money I didn’t need to spend. I bought my third (!) car in 5 years (“Lieutenant Mobile”) and insisted on renting a bigger apartment than I needed. Without roommates. Because I was finally making a decent salary and I deserved it, right? And to some extent that is true. But I’ve learned the importance of prioritizing your expenses, and that paying yourself first is rule #1 in personal finance. On the whole, I’ve taken the financially savvy path more often than not and I’m in a pretty great place now.
I want to give back to the community that turned me from a debt-laden new college graduate into a 30-something with a net worth that is several times the national average for my age group, according to US Census data. I’ll explain how I did it later, but suffice it to say I’m beyond grateful to the online personal finance community. I would never be where I am today without them.
Why MilitaryDollar.com?
Why did I pick military personal finance for my blog instead of just general personal finance? Well, there are several reasons:
- As a military member who is also passionate about personal finance, I’ve spent a lot of time researching the products that are available to the military. I’ve also learned that there aren’t nearly as many resources out there as one might hope, and some of the ones that do exist aren’t terribly user-friendly. So my objective is to explain personal finance to military members while making it easy to understand and implement.
- I believe it is important that military leaders be able to speak smartly to their troops about finances. Whether you have an O-1 who says “hey boss, I’m planning to buy a Ferrari, what do you think?” or an E-7 asking how to transfer their GI Bill to their child, being able to provide accurate, timely, and relevant financial information will help you be a better mentor and ensure the readiness of your subordinates.
- Finally, I’m doing this because enough people asked me to do it and it became too hard to keep ignoring. I’ve spoken to several military groups on a variety of financial topics. I’ve also served as a coordinator for three multi-week personal finance courses. I consistently get feedback that either the financial assistance provided on base isn’t clear enough, or people don’t want to use it because they are worried about their financial situation becoming known, or they can’t find the answers they need, or they are paying a financial advisor but don’t feel it’s worth the price. I’m hoping this blog will help you overcome any barriers you may have when it comes to financial planning.
So that’s why I’m here. I encourage you to reach out through the Contact Me page and ask questions or provide feedback. I’ll be posting Q&A sessions occasionally so if you have a topic you want to learn more about, let me know!
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