Featured Kid$Club Member Story of the Month- Dustin
Dustin grew up on a farm, was a good student and had a great childhood. He didn't get much financial help from Mom & Dad, except that he had a ready job on the farm that paid him an excellent $15 dollars an hour. Not bad for a young kid!
He was making good money, but never saved any of it and spent wildly in his teens and early 20s. After college graduation, he secured a quality IT job with a local start-up Minnesota company. He accumulated $40,000 is stock options and $5,000 in his Roth IRA by his mid-20s.
He thought he was good at finance, but he never spent time on a budget and continued his overspending. He blew his stock option money on material things (instant gratification) and was forced to spend his entire Roth IRA, when an emergency came up. To add injury to insult, he had to pay tax and penalties for his improper distributions of his Roth IRA money. In fact, in 2003 he had a credit rating of 412, out of a possible 850. That meant any money he borrowed on credit cards, cars, and a home, cost him 4-10% more than his peers.
Finally, when he got married he and his wife started the envelop budgeting strategy. This strategy puts money away each month in an envelope for income, savings, and expenses. It’s really a version of a Spending Plan (budget) that we discuss in The Kid$Vest Financial Binder (KVFB). They began turning their financial life around. Ten year later his credit score went over 750. Now in his 30s, he has kids and runs his own company. So even smart, motivated people can get way over their “financial heads.” But like Dustin, we don't have to stay that way!
Take care and have a Kid$Vest Day!
If you want to read more stories like Dustin or add your personal story of financial success or heartache, simply join Kid$Club below.
