I love to hear money success stories.  Here's one about a 23-year old, single mom who owns her home and has no consumer debt.  She lives in Colorado Springs; let's call her Jessica.

Two years ago Jessica's Mom bought her a Dave Ramsey Financial Kit which included 13 weekly one-hour video sessions at a local church.  Her Mom wanted Jessica to save for the future.  Jessica was inspired by the course and decided to get rid of her debt and start out fresh.  Her debt consisted of several thousand dollars from a car loan and slightly less on credit cards.  She over withheld on her income tax and then used the refund to become debt free.  Her attitude changed from "what can I buy" to "how can I invest for the future."  Or as she put it, "one pair of shoes now or five in the future."  She used money from an investment account funded by her parents when she was growing up to buy a foreclosed house at a deep discount.  She rented the house for the first year (someone else made the mortgage payments), and now lives in her house.

How did you do that Jessica?  Here are some of her financial tips:

Don't spend all your money - save some.  She contributes 10% to her 401(k) and pays half her mortgage every two weeks when she receive a paycheck.  She will end up paying less interest this way.

Don't use a credit card unless there is an emergency and you don't have the money in the bank.  If you are forced to carry a balance, find a credit card with an introductory zero interest rate for a year and then switch to another zero interest card when the year is up.

Never spend money you don't have and always know your bank balance.  Jessica checks her bank balance daily by computer.  She goes to great lengths to avoid the $30 overdraft.  Even when grocery shopping, she keeps track of the total in her head so she won't go over budget.

Shop carefully for groceries.  Don't go without a list; don't shop when you are hungry; don't take kids to the store.  Buy generic; grow vegetables at home; buy only what you need.

Jessica's attitude now is "I love money.  And I respect money."  She is exploring ways to invest, either in the stock and bond market or in real estate.  And at 23, she's certainly moving in the right direction.

Jessica's story has several common themes with other successful 20 somethings:  she started working early (age 16); she has parents who encouraged her to be wise with her money; and she is self-motivated to succeed.

Right on Jessica!


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Comment by Bob Stephens on November 30, 2011 at 12:06pm

Congrats to "Jessica" for her wise approach. The Dave Ramsey approach is a common-sense philosophy toward spending and saving and getting ahead.


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