How I Saved $40k by the time I was 21

Hi everyone and welcome back!

Every month, I share a post on my series about how to stop living Paycheck to Paycheck.  Budgeting is something that is learned and it is my hopes that this series will provide some great stepping stones to help people.  The series will run through June of 2017 but if you want the whole book now, you can get it here.

Growing up, all of my friends thought I had no money because I rarely went to the movies or bought random crap at the gas station.  In fact, it was quite the opposite.  I was saving my money.

Learning Young

From a young age, my parents taught me the importance of saving.  I remember being really young and receiving $4 per week allowance for doing simple tasks like making my bed every morning.   Out of these $4, I could spend $2 and I had to put $2 into my savings account at the bank. My parents had started this account for me when I was either born or really young and it already had included a small amount of funds from gifts.

As I got older and was able to do more chores, my allowance increased to $10 per week and the same rule applied.  $5 could be spent and $5 had to go to the bank.

Now, $5 doesn’t get you very far so I also had to save the spending money in order to get something from the store.  Over and over again, I would save up and by the time I would have enough money, I either didn’t want the item any more or I had saved so long that I didn’t want to see the money go.  So, most of my spending money ended up in the bank.


When I was 12, I started babysitting.  This is when I really started saving.  My first year of babysitting I was making $3/hr watching one child or $5/hr for two children.  The first year of babysitting I made a little under $1000, all of which I put into the bank.  I continued babysitting and saving until the kiddos I babysat were old enough to stay home alone.  This was around when I was 19 years old.  My fees had gone up to $10/hr for one child and I didn’t have any jobs with two children at that point.

In addition to babysitting, throughout high school, I worked the concession stands during the games, helped out my neighbor in her dental office, and got my first job in a retail store.  I also helped neighbors with house-sitting or other house projects like painting.

I remember one day when I was around 16 where I had three babysitting gigs in one day.  I worked from about 9am to 9pm with only enough time to go from one house to another between.  As much work as it was, it was so rewarding!

When I was 18, I landed a job that paid very well considering I didn’t have a degree.  This job was fun and flexible around my school schedule.  I stayed with this job for two and a half years.

Living at home

I lived at home until I was 21 even though some days I thought it was going to kill me.  I definitely had the fear of being the boomerang kid who moves out too early and can’t make it on their own.  So, I made damn sure I was going to be successful when I finally did move out.

The entire time I lived at my parents, I saved all of the money I earned.  When I was ready to move out, I started looking for a home to buy.  I knew I never wanted to rent an apartment.  Of course though, that purchase fell through and I ended up having to rent.  Anyways, good thing I had extra money saved up to put towards rent right?


I always knew that there were going to be large purchases ahead and that by the time I turn 28 that I would have definitely need a new car.  I knew that I was also going to buy a house.  This is what kept me motivated to save and kept me from buying novelties.   I will be turning 28 in April of 2017 and am very happy that I saved early on.  I am now able to sell my house and purchase house #2 where I will start my family.

While not everybody may be able to live at home until they are 21, there is always a way to better your situation.  Saving money towards a larger goal or saying goodbye to living paycheck to paycheck requires the motivation to work hard to have a better future.


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Say Goodbye to Living Paycheck to Paycheck: Choosing Your Budgeting System


This post is part of a series.  To start the series from the beginning, click here.  To browse through the series, click here.

Once you’ve determined which budgeting direction you will use, you need to start to layout the specifics of your budget plan.

One of the fundamental parts of creating your budgeting plan is to choose between a cash budgeting system and a digital budgeting system.

These are not to be confused with budgeting tools such as envelopes, check registers, and other types of tools.  All of the tools for budgeting can be customized to fit the system you decide to use.

A cash budgeting system is exactly that.  It’s cash.  No credit cards, just cash.  Of course, when you get to the point of saving, it could be a good idea to open a savings account rather than keeping a large supply of money around, but we’ll get to that later.

A digital budgeting system utilizes credit cards, checking accounts, online interfaces, apps, and many other technological opportunities.  All of your budgeting and tracking is kept in digital form and you are responsible for sticking to your budget without having tangible money to stop you from over-spending.

There are many benefits to both a cash system and a digital system.

Cash Budgeting

Cash budgeting is great for you if you like being able physically hold your money that way you know exactly how much you have at all times without having to log into an app or account.  Cash budgeting is also a great option for you if you dislike or have trouble with technology.  The system you use for budgeting should easily fit into your lifestyle.  If you don’t like being on the computer or phone, a cash budgeting system may be best for you.

Digital Budgeting

Digital budgeting is also a great budgeting system.  This system is good for you if you enjoy technology and find it easier to look in your app to see what your balance is.  While the digital world makes so many things easy for us, you need to pay special attention to your spending.  Unlike the cash system, where you literally can’t spend anything more than you have, the digital system shows no boundaries when you pull out the credit or debit card and run a transaction.  On the other hand, with digital budgeting there are a ton of options for charting your spending so you can analyze where all of the money is going.

Whichever budgeting direction you choose, make sure it fits in with your lifestyle and your budgeting needs.


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Say Goodbye to Living Paycheck to Paycheck: Choosing Your Budgeting Direction

Choosing your Budgeting Direction

This post is part of a series.  To start the series from the beginning, click here.  To browse through the series, click here.

Deciding between Reverse Budgeting and Forward Budgeting is one of the first things to do when creating your budget.

Reverse Budgeting in three steps

    • Determine your savings goal
    • Save a set amount each month to reach your goal.
    • Revisit your goal and adjust as necessary

Reverse Budgeting is good for you if any of the following apply:

    • You have a hard time sticking to your budget.
    • You succeed with a strict and well planned structure.
    • You know how much money you will need and when you will need it by.
    • You prefer to have clear goals

Forward Budgeting ‘Forward Roll’ in three steps.

    • Project your future savings.
    • Roll over extra funds at the end of each period
    • Repeat

Forward Budgeting is good for you if any of the following apply:

    • You are disciplined with your money
    • You succeed with a flexible schedule
    • You prefer fluid goals

Take this quiz to see which budgeting type suits you best.  Feel free to use a made up name. Or, if you prefer to take the quiz by hand, the questions and scoring are listed below.

Which Budgeting Type is Best for You Survey

1. You earn $100 extra cash.  What do you do?

      • a. Put it towards rent or other bills
      • b. Put it in a savings account
      • c. Buy something for yourself
      • d. Enjoy a night on the town

2. You are saving up for a new car and need $5000 more.  What do you do?

      • a. Put a set amount into savings immediately after each paycheck
      • b. Watch your spending carefully and spend as little as possible
      • c. Work overtime and put as much money into savings as possible
      • d. Get discouraged and give up

3. Which of the following best describes your five-year plan?

      • a. I live life one step at a time. Plans will change so why make plans?
      • b. I have specific goals and have strategized how to achieve them.
      • c. People actually plan that far in advance?
      • d. I know where I want to be and I will take whatever path presents me with success.

4. How do you prepare your grocery list?

      • a. I don’t, I shop each time I need to cook.
      • b. I prepare a shopping list before and only veer from it occasionally.
      • c. I don’t write a list but I have a general idea of what I need when I go.
      • d. I eat out, so I don’t grocery shop.

5. How do you handle household chores?

      • a. I write a to-do list and check each item off the list as I complete it.
      • b. I let it go as long as possible then clean right before company comes over.
      • c. I have a routine that I follow to keep me on track.
      • d. I don’t clean unless I have to.


Add one point for each of the following options you chose.

        Question 1: a or b
        Question 2: b or c
        Question 3: a or d
        Question 4: b or c
        Question 5: a or c


1-2 Points: Reverse Budgeting – You thrive in a structured environment.  You like to be in control of what happens and would prefer not to encounter many unknowns.  You’ve realized that money is not the most important thing in life.  Reverse budgeting is best for you because it allows you to create a structured budget to follow but still allows for carefully planned changes.

3-5 Points: Forward Budgeting – You are organized and proactive.  You know that there are multiple ways to reach an end goal and that as long as you keep moving forward, you will get there.  You are also responsible with your money which allows for some flexibility in the budget.  Forward budgeting is best for you because it gives you the freedom to make changes to your budgeting strategy at any time.

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