I was 17 years old I got my first legal paycheck. I don’t even remember the entire amount I just remember being proud.
I was poor growing up. Matter of fact poor is an understatement of what I was. I was broke as f**k and I never received a legitimate paycheck before. So when I got paid, I didn’t know what to do with myself. That was August 2002, I was out of the house and finally I had my own money…
Boy was I an idiot.
July through August 2002, I was training as part of the indoctrination program for the United States Naval Academy Preparatory school in Newport, Rhode Island. As a part of the process I served as an enlisted member in the military. During that time, I was paid a salary based upon the lowest rank in the Navy. It wasn’t much, but it was more money that my Mom ever made while working. So at 17 years of age, I actually had some money with no actual bills outside of the “Black Tax.”
I spent approximately eight weeks in training so that meant I had two months of paychecks that had accumulated in a bank account. I thought I was rich when I heard the amount I was paid.
On the first day of my freedom from training, I went to the ATM for the first time. All I can remember is saying, “oh my God look how much money I have.” A couple hours later all I could say is, “oh my God, look how much money I spent.” That day served as a great lesson in financial literacy and taught me that I had no concept of managing money.
At 17 years old, I had no concept of a budget or saving my money. A lifetime of paucity led to a reality of wanting everything in sight. I remember dreaming at night about everything I didn’t have. When I could finally afford them, I couldn’t control myself and didn’t realize what I was doing.
That day in the Navy Exchange, I bought DVDs, CDs, fast food, paid for a haircut for the low amount of $1000. You read that correct, I spent $1000 on stuff I truly didn’t need.
At that point in my life, I was in the best financial position you could be in. I had a good income with no true liabilities. However my life had afforded me with zero financial literacy.
Hindsight is 20/20. I understand today, that financial independence has a simple formula. The first step is pay yourself.
I had zero bills, my living expenses were paid for, guaranteed meals, and all I had to do was send my Mom some money each month (“Black tax”). Yet I used that time to spend 100% and sometimes 150%, of what I made each month. I finished that first year in debt.
Again I was an idiot.
Now, why am I sharing this? Well, I share the story with you to make sure that you don’t repeat the same mistakes that I did. When you get your first paycheck have a plan. Pay yourself first and live within your means. My financial literacy today is a result of both good and bad decisions that I made in my life. And believe me I made a lot of bad decisions, however those experiences taught me the most.
I still have the CDs that I bought that day. Problem is no one uses CDs to listen to music, so they are collectors items and by collector I mean they collect dust.
Your first paycheck is going to be an amazing feeling, but have a plan. Execute that plan. And keep the long goal in mind. My goal is financial security and independence for my family. What’s yours?
As always if you have questions or concerns regarding creating an emergency fund, investing, real estate, insurance, or planning for the future, don’t be afraid to speak with qualified financial advisor. Smart Asset has a great tool to find an advisor in your area or feel free to email me (contact@surgifi.com) to help you on your path to financial independence.
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I was a squirrel from the beginning, saving just about everything starting with my first job at Boston Market in Michigan.
Do you remember what CD’s /DVD’s you bought back in 2002? : )
Max
Absolutely do. Donnell Jones, LL Cool Jay, Eminem, I have all of them still to do this day.
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