Looking back on my younger years, I feel that much of my life would be the financial equivalent of Ferris in “Ferris Bueller’s Day Off.”
Growing up, life was good and I had all that I needed. We had a roof over our heads and were the common middle-class family, yet money was never discussed. It just sort of magically appeared and we never talked about how bills were paid or the importance of wise financial decision making.
My life resembled Ferris’s because when I got out on my own I enjoyed life. I enjoyed not taking responsibility and would push things off to indulge my desires now. This all came at the expense of my plastic god … the credit card.
Sure, I thought, I’d love to take your free piece of junk so I can get my hands on that shiny new credit card. I viewed it as my ticket to do what I wanted, when I wanted. I mean, after all, it is a blank check, isn’t it?
I acquired many plastic gods and then used them to fund a lifestyle I couldn't actually afford. Go out for a meal? Sure! Buy some music? Sure! Go on a nice vacation? Sure!
I was flexing my credit card muscle and became quite adept at it.
Then, reality struck and it was brutal. It was like a cold shower in the morning when the bills started rolling in. My thoughts were, “You mean, I have to pay you BACK … That’s complete nonsense because it’s just free money.”
Like a drug addict who is pained to come to grips with the seriousness of his situation, I was shocked into reality. At the end of it all, I graduated from college with not only a nice sized student loan bill, but nearly $25,000 in credit card debt.
Although I had just graduated with my bachelor’s degree, my biggest lesson was soon to come in debt repayment and the responsibility that comes with repaying debt.
Fast forward nearly 18 years (man that number is scary) and I would like to think that I have learned a thing or two about taking responsibility for finances. I have learned to live within a budget and make smart choices in order to live frugally so my family can accomplish our goals.
This also means teaching our dear children about the importance of saving and making wise financial decisions so they’ll have a firm foundation for when they start their own lives. I really want them to avoid, rather than repeat, my mistakes.
Personal finance can be daunting or intimidating for many. Over the years, I have discovered that I love finances so much that I went back to school and got my MBA in finance so I could learn more about it. While there may be topics and theories that might seem lofty, I view finance as something very simple actually: spend less than you earn and save as much of the rest as you can. In the end it’s simple math, and is not as difficult as some might make it.
What I love about personal finance is the first word: personal. We all come from different backgrounds, engage in different lifestyles and have different wants in life. While the basics of spending less than you earn should be followed the rest is personal and you can shape it to reach the life that you want. That piece of personal finance is actually quite freeing, and it simply requires you taking responsibility for your money decisions.
I am proof that if you start down the path to making better financial decisions that you can have freedom. What excites you most about the freedom found in managing your money well?