My Background

Okay, I probably should have started keeping records of what I was doing financially a long time ago, but in all honesty, It just didn’t occur to me until now. Unlike many of the bloggers out there whom I read, I have a negative net worth. So, I’ll try to give a basic background of where I started and how I got to here.

I was a bit of a slow starter in my industry, as I just wasn’t that focused on classes. I enjoyed working more than studying, and it took me a couple years longer than it should have to finish my degree.

Anyway, I graduated in December 2002 and was unemployed until April of 2003, when a college friend scored me a job at his company. Technically my degree was in Computer Science, but I had always wanted to do Networking. However, the job was as a helpdesk guy with the premise that I would be switching to the role of a programmer after a few months. Unfortunately, the pay was lousy. I was started at only $38k, which in Atlanta, is pretty poor.

I got a modest apartment, settled into my new professional job and bided my time. Eventually I rediscovered my joy of programming and decided to focus on moving forward in my career. I got a modest raise to $41.5k after about 6 months, and to $43575 about 6 months after that.

After my car died on me in February of 2004, I decided I’d had enough of the used car life and wanted to “treat myself” to a new one. The old car had lasted 8 years and I had stuck with it through lots of work. I knew I should probably buy a used car, but 1) I didn’t have the skills or time to deal with repairwork, and 2) I was already living really conservatively. So after getting the car, I was still able to save a few hundred dollars a month.

In April of 2004, my lease was up at my apartment and I moved in temporarily with the friend who’d gotten me the job. We’d both been reading the Kiyosaki books and had bought into all of his theories. We decided to get a house to rent out, though neither of us could afford to pay for a house and keep up an apartment. So, we decided we’d move into the house, fix it up as needed, then move out and start renting it.

We got a house at the end of May for about $137k that needed modest work. Unfortunately it’s harder than we thought it’d be, and we just didn’t have time to work on it, so to this day, it is still in need of some work.

Around October, my friend left our company and got a pretty good raise, maybe 40%. Armed with this knowledge I told my boss that I knew the market was paying and I wanted to be making $55k. He told me he didn’t think the market was that good but he’d raise me to $50k early next year. I said okay, and decided I’d stick it out a bit longer. A week later, I got a random call on a Sunday night for a contract to perm job paying $32/hour.

I took the job and stayed on contract for about 4 months before moving to permanent and negotiating a salary of $70k. While still not the greatest salary, it was a great increase over the $43.6k I’d been making a few months earlier, and the new company matched 401k to 4%. My last company didn’t match at all.

So, I decided to open a 401k. I’d had one before but had to cash it in when I was unemployed. I wanted to contribute up to the matching limit but realized 3 months of the year were already gone. I did some funky math thinking if I contributed more then my company would “catch up” so I got the full 4% for the year. Apparently they match up to 4% per pay period. So if you skip 6 months of payment, you are only gonna be able to get matching for the remainder months.

Anyway, that mistake left me putting 10% into my 401k each pay period, which, while more than I anticipated, was not such a bad thing. I decided that since I didn’t really miss the money (I was still bringing home about $700 more per month after the deductions), I’d just leave it alone.

I also opened up an ING account about that time at the advice of my brother. That turned out really well and over the last 6 months I’ve made almost $50/month off that account. That also helped me to notice the big problem I had of hoarding money.

See, my father is one of those old fashioned guys that believes you just save money in the bank and keep no debt. Great advice, but it neglects the power of things like 401k programs, mutual funds, etc. My mom on the other hand understood the investment vehicles, but was terrible at budgeting. Between the two of them they had no money. So from their examples I gathered some good habits – 1) Hoard your money, 2) Invest your money. The problem is I could never figure out how those two could coexist.

Well, that’s how I got started on this path of finances. I wanted to avoid the pitfalls my mother had made in squandering the money she made, and avoid the shortsightedness of my father in not getting my money to work for me. So for now, I’m trying to find the right balance of the two.