Financial Report Card: Alex P.

This post is one in a series from real actual life. Along the financial journey, we do some things well and others not so well. We learn as we go, and benefit from sharing our stories.

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Alex P, 32 (they/them)

Coordinator, education, Indiana

Looking back at your 20s, how would you grade yourself in the five key areas of personal finance?

Creating income: C

I was consistently employed throughout my 20s, except when I moved and started grad school, but I was always earning very little money. I didn’t do any planning as far as next steps, or really know how to earn more. I just hopped around through lower-paying jobs, with some theories about what I wanted to do but no actual direction.

Career wise, I’m at the point where I’m a little burnt out, and I’m thinking about doing something else. I’ve changed my thinking in terms of what jobs I want to do. I realized I actually need some money to live the life I want, as opposed to doing a job that’s meaningful but doesn’t allow me to do anything outside of that. This is hard to figure out if you don’t have experience. So I’ve started to ask myself, “What would I be ok with giving up and what would matter to me?”

I lived in a number of different places in my 20s, urban and rural. I got to the point where I realized neither of those extremes was quite right. Where I live now, everything I need is close by. I’m in reach of bigger cities, but the cost of living is so low here that I can do more than if I actually lived in any of those cities.

Spending less than you made: A

I’ve always done a good job of this. My entire life, I was used to spending very little and was always aware of how much I had. I definitely got that from my parents, who were retired and didn’t have high-paying careers before that. Living on a fixed income dictated how they spent money.

My dad was very strict about money, and my mom was good at really extreme planning. She was able to do things with very little and also be ok with that. I wasn’t given much money growing up. When I would ask for something, they would say, “Do you really need that? Is there a way you could not buy that?” So I got really good at coming up with creative ways to not spend money.

Paying down debt: B+

Because of my limited spending habits, I managed to have very little debt in my 20s. I had a credit card, but I paid it back in full every month, and I only used it in the first place when I knew I could pay it back.

I had some loans from college, but my parents had agreed beforehand to pay those. It was more cost-effective for them to take out the loans and pay after. I do still have loans from grad school. I’ve always paid my debts, but I never had any huge ones that made it challenging.

Investing in your future: D+

I didn’t really invest, unless you consider the educational investment I made in deciding to go to grad school. I never had enough money to do anything other than get by every month. I’ve definitely improved since my 20s, partially because I have a better paying job than I ever did back then.

Sharing finances with my partner has made a huge difference. Now we have two incomes and a relatively low cost of living. Decreasing the pressure of relying solely on my own income has finally allowed me to think about some other things. I know I could make a job change, or get by for a few months without a paycheck, and make more money after that.

I’ve also been really intentional about saving for the past year, so I have some fall back. I never had more than two months’ worth of expenses before recently.

Knowing your money: A-

I’ve always been really good at paying attention to my money and knowing where it’s going. For a long time, I recorded everything I spent on my credit card, by hand, in a bunch of accounting notebooks my mom gave me. I started that from the time I first got a credit card, around 19.

I also read everything, every policy, and looked for discounts. I always tried to find the cheapest way to do everything. I used an app for budgeting when I had maybe $100 to play with every month for about 6 months. I could put in expected income and categories and it showed me how much I had left. Eventually I stopped using it when I had a job where I wasn’t quite as concerned.

I kept up the credit card records until very recently. I stopped it because I was tired of it and it got kind of boring. Now I use my credit card more because I rarely have cash, And I get rewards, so why not? I have the apps for my credit cards on my phone now, and I do look at those regularly.

For the past 2 years, I’ve been using a Google Sheet. It’s customizable and free. I still record checking and savings by hand.

I do my taxes, for myself and my partner. I’m more confident about it than they are, so I do that and they take me out to dinner. Win win.

I’d like to talk to more people about understanding money and the things that they do with it. I have so little exposure beyond what my parents did and how they managed it. I was so focused on just getting by for a long time, and I don’t know what the possibilities are.