I was different during my time in service. At 19 years old my peers were barely starting college, lived with their parents and joined to pay for college. Not sure exactly why, but I wanted a Career. Classic case of the board game Life if you ask me.
Early on it was pretty easy to tell that college wasn't going to be the best choice for me. I just felt uneasy about sitting down the school counselors to sign my life away on a bunch of loan papers and government assistance. I didn't want the pressure of those loans hanging over my head for the next 10 years not knowing how I was going to get them paid off. I knew I was a hard worker and could go far in Tech if I was given the opportunity.
This put me in a very different boat than my peers. Again, I wanted a career that I knew I would be good in and take me very far in life. I was not confused about my life, nor did I want to spend 4-8 years in college "figuring it out" while I racked up debt every year. I got myself my first credit card for my 19th birthday before shipping out to basic training. After I returned from my IT school I proceeded to use that training to start that career. I actually started my career for my 20th birthday believe it or not, at $10 per hour taking calls.
The Importance of Financial Literacy
It was always funny watching my friends brag about their credit scores being 50-100 points above mine until push came to shove and a single inquiry dropped them into the low 600s. I began building my credit at the first chance I could think of and by the time I was a year out of basic training I had 3-5 different accounts and had requested for 3 credit limit increases to start up my credit journey. It doesn't sound like much, but the people I was around didn't worry about credit until they were ready to settle down and purchase their dream home. This is the story of millions of Americans today, but hopefully throughout these pages you see that you don't have to be this way.
Follow the page for future updates including my list of accounts, both personal and business!
Of these accounts includes a small starter car that I paid off in a two year time period, a furniture card for my first apartment that I paid off in less than 12 months, and a few other strategic accounts that will be covered in the future. During that same time period most of the people around me were getting drunk in college, opening store cards to buy clothes and sitting at home playing video games. Money management and finance has always been a big part of my life and is one of the major reasons for where I am right and where I'll continue to go. This isn't a unique story, and it all starts with treating your bank account with a little more care.
Good Money Habits
- Begin monitoring your credit score through creditkarma.com - An account through these guys is completely free and has amazing tips on getting a good score and keeping a good score while showing your current standing. The reason you need a decent credit score, around a 690 or above, is for any money moves you're looking to make in the future.
You want the bank to trust you as much as possible to keep you from paying an outrageous amount of money for a car like many military members do these days. It'll also make it easier to get loans through peer 2 peer lending services like lending club which require a very high credit score to expedite and automate the approval process.
This will also help you with making major decisions in your life. If you're moving into a new apartment it's almost impossible to get in somewhere nice because they require high deposits, good credit, and great rental history. You most likely won't have that rental history starting out so if you can bring a little bit of money to the table and a decent credit score with a couple diversified accounts you're much more likely to land that flat downtown.
You want the bank to trust you as much as possible to keep you from paying an outrageous amount of money for a car like many military members do these days. It'll also make it easier to get loans through peer 2 peer lending services like lending club which require a very high credit score to expedite and automate the approval process.
This will also help you with making major decisions in your life. If you're moving into a new apartment it's almost impossible to get in somewhere nice because they require high deposits, good credit, and great rental history. You most likely won't have that rental history starting out so if you can bring a little bit of money to the table and a decent credit score with a couple diversified accounts you're much more likely to land that flat downtown.
- Start contributing to a 401k retirement account or TSP as soon as possible - I mention this because it's a great place to start. About 98% of the people reading this are currently employed or self-employed and have the opportunity to contribute to tax advantaged savings. If you don't do anything else throughout your career to boost your earnings or can't figure what you want to do yet, then contributing to a 401k will give you that nest egg for the future while you figure out what you want to do with those funds.
If you contribute $150 per month to your 401k, I recommend Roth, and you do that from 20 years old to 35 you'll be putting away $1,800 per year. Over the life of your savings you will have put away $27,000. The goal of this is to give you something. Over time you'll educate yourself and improve your career stance or start a business. At this point you could either increase these earnings, cash out to fund your ventures, or take a loan against your 401k. The point is to give you options.
Using that funds properly will require weeks of research and talking to experts so please don't make any decisions based on this post. You do have options though. I recommend leaving the money and taking out a loan against your 401k. The interest you pay on that loan goes right back into your 401k in the place of earnings you would have received from the market during that period. Even $20,000 is enough to get you into a smaller investment property and start earning you extra passive income. It could also be used as a great startup fund for many business ventures. On top of that it gives you a healthy asset for the bank if you're just looking for a regular loan.
If you contribute $150 per month to your 401k, I recommend Roth, and you do that from 20 years old to 35 you'll be putting away $1,800 per year. Over the life of your savings you will have put away $27,000. The goal of this is to give you something. Over time you'll educate yourself and improve your career stance or start a business. At this point you could either increase these earnings, cash out to fund your ventures, or take a loan against your 401k. The point is to give you options.
Using that funds properly will require weeks of research and talking to experts so please don't make any decisions based on this post. You do have options though. I recommend leaving the money and taking out a loan against your 401k. The interest you pay on that loan goes right back into your 401k in the place of earnings you would have received from the market during that period. Even $20,000 is enough to get you into a smaller investment property and start earning you extra passive income. It could also be used as a great startup fund for many business ventures. On top of that it gives you a healthy asset for the bank if you're just looking for a regular loan.
You can do it too
With a couple simple changes to the pages you scroll on facebook or the blogs you read before bed, a huge financial boost could be right around the corner. Make sure to stay on top of your credit score by being responsible with your spending, paying your bills on time and checking your credit score weekly with Credit Karma. Start saving in any way that you can to plan for future expenses and set you up for an easier life down the road. Get a couple accounts and implement your own Envelope System. Start pouring money into your 401k or start saving up to start a business. Keep saving, and tell your friends. Happy Spending!
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