Welcome to Learn Cents. I started this blog to try and help inspire people to take control of their financial situations. I know what you're thinking... "What makes this money blog so different from the others?" Well, the answer is, nothing really. This blog is free, and it's up to you whether or not you wanna read it. I'm just giving my two cents to try and encourage people to take control of their lives.
Let's start with who I am. My name is Shane and I am a self made multi-billionaire who is trying to make even more money off of you! Just kidding... I'm just like you, I know where you are coming from. Like I said, I'm here to share my knowledge, along with collect the thoughts and ideas other people might have. I'll let you in on my financial story so you know how I came to be where I am. I feel this will help for you to associate with me on a more personal level, however, if you don't feel like reading it, that's fine too.
I became an adult in '05 and opened my eyes into this amazing world of opportunity. Luckily, I was "smart" and didn't immediately rack up any debt excluding my massive student loans. I had one credit card with 8.9% fixed interest, which I had never used. I was pretty good about paying the few bills I had but I occasionally overdrafted on my checking account. I applied for a Kohl's card which actually worked really well for me, occasionally buying new clothes and paying off the card. I worked at Dairy Queen for a couple years, and in late '07 I began saving portions of my weekly paycheck. I calculated that $180 was sufficient for me each week, so I put the remainder straight into savings. I was doing great, and within a few months, I had over $600 saved up.
A few months later, I quit working fast food and began working a full time job dealing with computers, making $10/hour. With the pay increase I decided to get my own place. I found a duplex with my friend and my girlfriend and figured it was doable (Big mistake in itself, yes I know!). The rent was cheap, $625, and split 3 way I knew I could afford it. Weeks before moving out, my guitar was stolen from my car. I was devastated. Well, stupid me decided to stroll on over to Guitar Center within a month of living in my new place. They had one of those "deals" with no interest or payments for a year if you applied for a credit line. And guess what... I applied. I walked out of that store that night with my new guitar and case, amp, and accessories, along with my first big chunk of revolving debt, $877. I didn't think anything of it. I figured, I'll just pay it off before I have to pay interest.
By December, I had somehow managed to spend ALL of my $600+ in savings. I don't even recall how. I spent it on stupid things we "needed" for the apartment. Since Christmas was coming up, I decided to go all out on shopping since I was officially an "adult" now, living on my own and all. I pulled out that shiny, unused credit card with the 8.9% interest. My justification, I was going to "build credit", and planned to pay it off within a few months after Christmas. Yeah right... I managed to spend $600 on that card in one month. I was an idiot. Christmas was great that year, and I started planning on how to pay off the debt.
Then the unexpected happened... I lost my job on January 2nd of '08. I'm not going to get into details on what happened, but it was a pretty complex situation. I was given a couple weeks to find another job though. I had no idea what to do. I had just moved out and my income was on a countdown timer. Keeping my composure, I applied for more IT jobs, and after a few weeks of no income, I finally landed a contract job doing desktop support for another company. The pay was a little better at $13 an hour, and I figured, "great! I can pay off my debt!" First I had to buy dress clothes for the job. I swiped them on my Kohl's card with no other option. Then I had to catch up on some minor bills that had fallen behind. After a few paychecks, things were starting to look my way. However, within a few months of working there, I received a call from the consulting company stating that the contract was ending in a week. They reassured me that they would line up more interviews with other companies. Well, that week passed by and still no interviews. I followed up but they seemed to be avoiding me. By mid March, I took the hint that nothing was gonna happen. After I faced yet another familiar couple weeks of unemployment, my friend quit the lease on the apartment. He was being deployed to Iraq, and all I could think about was how I was going to afford the extra third of rent and utilities with no job.
Finding a job was much more difficult this time around. Nobody seemed to want me, and with my limited IT experience, I figured I would have to go back to fast food or retail. Luckily, I received a healthy tax return for paying my own tuition. Between that and the $300 stimulus though, it didn't last me very long. Going on a month and a half of unemployment, I was being rejected everywhere. I lived on Ramen and didn't go out at all. In order to make ends meet, I racked up my credit card to the maximum, $1500, and I felt like all was lost.
I decided to apply at the Sheetz gas station by my apartment. They weren't even going to give me thirty hours a week, so I figured I would have to quit school and work two jobs. I wanted to avoid this at all costs but I felt I had no choice anymore. Then I received a call from a place I applied to for a computer job. They wanted an interview on April 21st, two days before my 21st birthday. I went in there knowing I had no option but to get the job. I was so utterly determined, that I crushed the interview. I felt good about it, but I still had doubts about whether or not I would get hired. They called me at the end of the week with an offer. $37k plus great benefits I wasn't used to ever getting. I couldn't believe it, I didn't even have a degree yet. What an amazing birthday present!
Everything seemed like it was finally turning for the better, but within two weeks of working, I got a kidney stone. The worst part, I had to drop my health insurance during unemployment, and coverage from my job wouldn't start until the next month. Just another pile of bills to add to my debt. By this point my total debt had accumulated to over $5k, excluding my student loans. But I didn't seem to be that worried. With my newly improved income, I felt confident about paying back the debt. But in actuality, I was too comfortable with my income, and I felt too comfortable increasing my spending habits. I also more than willingly offered to pay most of my girlfriend's share of rent and utilities so she could look for a better job. I was getting nowhere.
It took me a while to realize it, but by December or '08, I finally realized that I was repeating the same mistakes. How was it that I made more than three times as much as a year and a half ago, but I still managed to overdraft my account? How was I able to save $200 a month while working at Dairy Queen, but live paycheck to paycheck with a decent salary? I sat down and analyzed my situation, and saw my weaknesses. I also identified my vulnerabilities. I began a vigorous debt pay off plan by the end of December, I was ready to change my life.
I spent a total of $25 for Christmas this past year. I know, skimpy, but I didn't have the money. By January I had started eliminating my small debts. I knocked out late bills, medical bills, among others, one by one. Once I freed up some income, I joined my company's 401k plan. It has a 100% match up to 4% of my salary. I started feeling really good about my progress, and I began to work harder to pay everything off. By February I only had my three revolving debts left. My dad had been laid off from work among other things, and it was decided that I would move back with him to help pay his mortgage. This actually helped both of us because I started paying considerably less for rent. Ever since, I have applied about $1000 a month to my cards. On top of that, I received another large tax return for paying my tuition, along with a bonus from work. I used my bonus and $300 from my tax return to contribute to the debt payoff, but I left the other $3k to save for a house. I wanted to prove I could do it without a huge crutch.
And now, here I am. My revolving debt will be paid off this Friday, April 17th. Along with that, I have $3k saved for a house, and I recently started three other savings funds: an emergency fund, a medical emergency fund, and a new car fund. I set all these savings up at ING Direct, as I've heard great reviews about them. I set am setting up my direct deposit to disperse specific amounts from my paycheck into each account. I also have over $700 in my 401k now!
Although hearing my story might not really help you with your financial problems, I still think it's good for you to know where I have come from. I know I don't have anywhere near the worst debt problems, but it's good to hear from someone who was in similar shoes as you. I'm not a financial guru, it's a work in progress, but everything I learn and have learned, I hope to be able to share with you. I want to help everyone become financially free as a whole.
Thanks for reading my blog, and I hope to have returning visitors who are either searching for advice, or who are willing to share from their own experiences or knowledge.
