Hi, I’m Kraig. I’m 29 and I live on my own in the Minneapolis/ St. Paul metro area. I’m a geek about money, I live my life debt free and save over half of my take-home pay. I do it for the peace of mind, the lowered stress and anxiety, the excitement of what it will mean for my future and so that I can retire/become financial independent as soon as humanly possible. I don’t want to live the normal life where I’m a slave to someone else until I’m 65 and then a slave to the government for the rest of my life after that. I want freedom. I want to own my time. I want to spend my time working on things I’m passionate about. I want to make the world a better place. I’m going to be different.
I grew up in small town Minnesota with a great family. I always thought a little differently about money and felt compelled to be financial independent someday. I didn’t put much thought into how I was going to do it as a kid other than deciding that I was going to do it, and by the time I was 45 years old. I just didn’t see the fun in working for someone else for 40 or more years. It seemed to me that a full time job was a loss of freedom and a large drain on life in general.
I had two financial role models in my life while growing up, my dad and my grandpa. My dad was known as a cheapskate because he spent money very carefully and deep down, he valued financial security for his family above anything else. My grandpa was known as a spender because he liked nice things and took pride in them. I naturally gravitated towards my grandpa’s ways of handling money, which was spending it. As soon as I was old enough to make money by mowing lawns in the neighborhood, I began spending all of it. I bought nice clothes, a nice bike with accessories, nice electronics and eventually a nice car, in which I decked out with a stereo system, chrome wheels, a remote starter and all sorts of other gadgets. Like my grandpa, I have always liked nice things.
I lost my dad and my grandpa when I was in high school to cancer. I officially had no more financial role models. It was now up to me to decide who I would be in the future. I continued taking after my grandpa through my high school and college years and into my young adult life on my own. Little did I know just how much like my dad I really was.
Life in the Real World
When I graduated college, things became different. I now had to pay for everything. I had to grow up. I somehow got by with my 20-some (and then 30-some) thousand dollar per year salary, while still managing to buy a new HDTV, a nice computer, some furniture for my new place and plenty of entertainment and travel.
A year after working full time after college, I took a road trip to California with friends and took my car, which wasn’t anything fancy, but it was paid off. It ended up crapping out on me in the middle of California. We didn’t have any time factored in for something like that, leaving me forced to make major decisions very quickly.
I was young and dumb and I decided to trade my car in so I didn’t have to pay for the expensive $2,000 bill to fix it. After all, I had a steady job now and I could afford the payments. I bought a much nicer car than I should have, but one I didn’t even like. It was all they had there and I had to do something.
After driving it back to Minnesota, I traded it off again for an even nicer car. After all said and done, I ended up with a $20,000 car that I financed 100% of. Combining this with my student loans, I was over $25,000 in debt at 24 years old with a very modest salary. I was in for a big treat.
Living as a Broke Person
After the car purchase, I began to feel what financial stress felt like. Being a math geek, I ran some numbers through the calculator to figure out how quickly I could pay off this 5 year, $20,000 car loan. The size of this loan in comparison with my income just didn’t sit right with me. I was stressed and anxious. Then fall of 2008 came and our company laid people off due to stressed finances. I felt even more anxious about what this could mean for me.
And so began my journey to get rid of that financial stress and anxiety. I sure loved my car, but I hated feeling that way. So, I decided to pay it off ASAP. I worked hard at it for a couple years and put a big dent in my car loan.
The Birth of a Personal Finance Geek
And then it happened. I found Quicken Online (soon to be Mint.com) and started tracking all my finances. Then I found Dave Ramsey. He really connected with me, probably because he reminds me of my dad. I started listening to his radio show religiously and soon decided that debt was the problem and that I needed to get out of it ASAP.
I limped a long for a while, trying to make progress and then got set back pretty big by a very expensive month of life. I booked a vacation when I shouldn’t have and then ended up having emergency dental work done (to the tune of almost $2,000) right before my vacation. It made for a $5,000 spending month, which set me back big time. I was knocked down by life and felt like I wasn’t getting anywhere.
It was then that I reached my tipping point. “That’s it”, I said. “I’m cutting big. I’m not living like this anymore.”
And it has been all progress from there. That was Memorial Day Weekend, 2010, when I decided to get “Gazelle Intense”, as Dave Ramsey would put it. Before that point, I was spending as much as I made. From that point forward, I have been spending less than I make every single month, in increasing numbers. I paid off my car 5 months later in October, 2010 and my student loans 2 months after that, in December 2010. I was then debt free and decided to never go back. As of writing this in December 2012, I have been spending less than half of my take home pay for over 2 years.
So now I’m debt free, I have a 6 month emergency fund and I have over 3 years of living expenses socked away in investments. What’s next? Financial independence/early retirement is what’s next. I’m on a mission. Join me in living below your means for big reasons:
- To get your life back
- To stop worrying and being stressed out
- To own your time and do what you’re passionate about
- To make the world a better place