I'll Retire Rich. Lessons From a Normal Girl Who Did a Few Things Right.
Let's talk about money, honey.
I love talking about money, particularly personal finances. I'm not scared of money. I don't think it's a private matter. It's necessary to fund our lives and, for me, it's a super fun topic that I could legitimately talk about for hours.
One of the main goals of Sips of Sunshine is to share little bits of life advice and positivity with my readers and friends. So today's post is about my financial journey and be open with you about what I've done right and what I've done wrong when it comes to personal finances.
Very high level overview so you know where I'm coming from:
20's and early 30's: lived in Florida, made very little money compared to my experience and talent, lived a full life where I traveled the world and didn't lack for anything I needed; was debt-free by 30 and have been ever since.
Mid 30's and into 40: working very hard and successful personally and financially, but many of the habits I built when I wasn't making much money still stick with me which has been a good thing for the most part.
So let's dive in.
What I've Done Right:
Automating My Retirement (when I made like no money): This is kind of a two-fer. I did two things really right in my 20's: I automated my retirement savings and had 10% of my income pulled from my paycheck before the paycheck even hit my bank account. The kicker is that I did this when I made VERY LITTLE MONEY. Most people would have looked at my income at the time and thought it wasn't possible to take away 10% and still be able to stay out of debt and pay the bills. I decided to bite the bullet and just do it. I used to say this to myself: "If I lost my job tomorrow and was immediately offered a similar job that paid 90% of my current salary, would I take it and be okay?" The answer was always yes. And that's how I knew I could save 10% of my income.
I Understood Compound Interest: I was confident in automating my retirement savings in my 20's because I, former math nerd, understood and loved the concept of compound interest. I knew the sooner I started saving, the small investment dollars would turn into huge retirement dollars. And I knew that every year I waited to save was robbing "Sexy Golden Years Amy" of her fabulous life cruising around the world and drinking fine wine in Italy.
I Paid My Way Through College: I worked 3 jobs and didn't take out college loans. Yes it took me 6 years to graduate because of this and there are probably very valid arguments for me taking out loans and graduating sooner, but I left college with a Bachelor's degree, no debt and a wonderful college experience which included traveling around the world several times with my college friends and all the other fun stuff that comes with being a college student.
Vanity Metrics Weren't a Priority: What's a vanity metric? It's any measurement that is based on vanity, ego or popularity. So when my friends were buying nice new cars, I was driving my paid off Nissan Altima for 12 years. When my friends were living alone in nice apartments, I was living with a roommate in my apartment just a few blocks from the ocean. When my friends were buying designer bags, I wasn't. My life was still super amazing and fun and full and I didn't want for anything. I actually loved that Altima and loved having roommates and have never cared about designer clothes or bags.
I Crushed Debt: When I was 27, I had $4,500 in credit card debit. The dumb kind that I had racked up buying shirts at Express and dinners at Bonefish. I made the decision on my 28th birthday to enter 30 debt free. I went to my local credit union and took out a loan to pay off the entire credit card. I was paying some insane interest rate on the card like 22% and I could get a loan at 9% from the credit union so this made a lot of sense. I paid off the card with the loan. I locked the card in a drawer. I did the math with the credit union to pay down the loan by 30. And I did it. I've never had a penny of debt since and haven't paid anyone any interest for borrowing money I didn't have. I sleep soooo well at night because of this.
Even When I Made More Money, I Kept Many of the Same Habits: As I've advanced in my career and worked very hard, I've made more money. And you will too. But the habits I created during all of those years of not making much money have set me up even better now. That 10% is still clicking along but the number is bigger so that means even more money in retirement one day. I still live below my means in rent (I could pay more in rent but I choose to live in a less expensive place and enjoy my money for more meaningful things like travel). I still don't care about vanity metrics. I still don't have a penny of debt.
And because of these things, I'll retire with a few million dollars and that's just where things sit right now - I have some big personal financial goals that will put me way over that number. Some people have said that I'm not living my fullest life now and "over-saving" for retirement. I really don't feel that way. I live an incredibly full life and don't want for anything. I feel like I've created a nice sweet spot of current happiness and future confidence.
You see, I didn't make a ton of money and I didn't do anything crazy. I just started early and was consistent and confident and trusted the process. I promise you, if you're reading this you can do what I did. And if you're past your 20's, start anyways. There's this ancient saying that I love so much - "The best time to plant a tree is 100 years ago. The second best time is today."
Know that one day you can stop working and enjoy your life and have good healthcare and all the things you don't think about now, but trust me time stops for no one and the tiny sacrifices you make today will pay off in huge ways years from now.
What I Did Wrong:
I Didn't Ask for What I Was Worth: I should have known my worth in my 20's. I should have seen the intelligence and talent I brought to my role and asked for what was due to me. I don't blame my company, I blame myself. But I was young and I didn't have any career experience and I didn't have the life experience that I have now.
That's really the one thing I would change. I would have opened my eyes to what I was worth and asked for it. But things work out the way they should and I'm living the life I have now because of that girl in her 20's who lived in a beach town in Florida and drove an older car and spent hours in her living room with her roommates laughing over bottles of wine. And I wouldn't have it any other way.