Opening Up About My Financial History

Today’s article, I’m going to piggyback on a call of in the blogging circles to be more transparent with readers. It’s a little inspired by whose upbringing is surprisingly similar to mine.* Truth is, I’m not really sure what else I have to hide. I’ve been blogging for 12 years and you can follow my almost daily thoughts on money here. All of this stuff is nothing new to people who have read those nearly 2500 articles. However, because I don’t expect anyone to be insane enough to read nearly 2500 articles of my writing, it makes sense to cover at least some of it here.

The Beginnings

I’m white. I’m male. I was born in the suburbs of Boston. Those three things alone probably put in the top 99% (and some 0.9 decimal points) of most privileged people of Earth. It seems there’s a focus on personal finance bloggers writing about their privilege lately. That’s a fair point, but I also feel that there’s a

I’m also 41 years old (as of this writing). At a very young age, I was called “gifted.” I was put in the honors classes. My peers voted me “Most Likely to Succeed.” Brandeis University (one of the top 40 or so in the country) gave me a full tuition for all four years.

Let me rewind a bit. My parents, who I believe would be firmly middle class, bought our family something called an IBM PCjr. Whether it was solving King’s Quest games or programming in BASIC, I couldn’t stop reading about computers. My idea of a fun day was to go to the library and read about Forth, Seymour Papert, or The Mythical Man-Month, which still occasionally reference.

I mention all this because Malcolm Gladwell in his Outliers book explains that Bill Gates had a unique opportunity to be around computers that helped shape his success. At this time in the early 1990s, my high school’s computer programming class was mostly a moonlighting gig by the math teacher. There were only a 2-3 students who had any experience programing computers, which I think made seem like some extreme genius.

I’m a little hazy on the history of this, but I think after my father died (I was in 8th grade), my mother became more interested in the family finances (natural if you think about it). I read financial magazines started investing my paper-route, pizza place, and pharmacy technician money. All three of those jobs my older brother had before me. I had the privilege of following his stellar reviews. (I wasn’t nearly as good as any of those jobs as he was though.)

I was taught the basics of personal finance, save money and invest it, at a time when there really was zero personal finance education. It wasn’t just this, but my mother is famously frugal. I don’t remember being taught that… I think it was just part of the culture of how we lived. In any case, it’s all part of the puzzle.

The Post College Years

I graduated college with a degrees in computer science and linguistics.** I had hoped to with BBN Technologies, but they weren’t hiring people out of college. In fact, almost no one in the Boston area was hiring in 1998 (which seems weird) because the Internet boom was starting to take off. I hooked on with New York Life’s 401K division. It was a terrible job, with a terrible boss, using terribly outdated technology (FoxPro for DOS).

I did learn a lot about 401Ks. Having them shoved in my face everyday helped me focus on paying myself first rather than the tax man.

However, I got to the point where I wasn’t learning anything with the Internet and there were employees in front of me who were going to get those opportunities first. I tried to use their educational benefit to take classes, but I couldn’t get anything approved by my manager because no one was teaching DOS-based classes in the world of Windows 98.

I moved onto an internet start-up where I quickly learned the ropes and moved up the corporate ladder. Soon I was a 24-year old manager of a division with 5 employees. I loved the corporate world until our company got bought and our entire technology was laid off. It was perfectly terrible timing as the dot-com bomb of 2001 had just happened.

I would struggle and get by with mostly terrible, short-term, contract work until 2004.

That’s when some people at my old internet start-up contacted me about a new company they were forming. At that point, I was happy to get a job and took 30% less than what I had made in 2000.

After a couple of years at this job, the culture got “toxic.” The old CEO who hired me left and the new CEO was caught plagiarizing one of our competitors. A disc with employee salaries was found by someone and secretly sent around the company. I found out I was the lowest paid, by a lot. Armed with Salary.com data and a list of my accomplishments at the company, I was told that they couldn’t do anything for me related to compensation – not money, options, even vacation time.

My fiance was similarly dissatisfied with the way her work was treating her. She had applied for a job in San Francisco never expecting to get it. Well she did. In 2006 we moved to California.

My wife’s condo and my condo were under water, so we rented them out… as we continue to do today.

The Blogger Years

I started my blog in 2006 before our move to California. So from here you can following along in the the archives.

In Silicon Valley, I had a job for about a year and then decided to give blogging a much larger focus of my time. Silicon Valley’s expectations were that you’ll code 70-80 hours a week.
Despite being just a little over 30, I was burned out from 25 years of coding. I was older person at my start-up by about 5 years… Yes, nearly everyone was under 25. I think the CEO was 21.

In any case, at this point in my life, I wanted to “have a life.” There was zero work/life balance. The blog was making between 25K-35K (and it probably continues to average in that range over the life of it). I did some other consulting on the side. I was able to use the extra time I had to explore ways to save us money. My wife, a miliary pharmacist, was earning a very good salary. We had no kids, but eventually got a dog. Even though we were in Silicon Valley, we were doing well saving money as our rent was relatively cheap.

For 5 years we grew our net worth quite a bit… greatly aided by maxing out of retirement accounts and the stock market. We even added another rental property because “the price was right.”

In late 2012 we moved back to the east coast in Rhode Island, bringing one boy with us and soon having another boy.

Today

That brings you up to today. I still run the blog, but now I a bunch of other things. I do a lot of dog boarding. I’m shuttling the kids to and from school, making lunches, dinners, grocery shopping, doing dishes, etc.

Net Worth: Though I don’t disclose our net worth numbers, I will say that our number today would be in the 90th percentile in 2016 using this calculator. It’s unfair to compare today’s numbers to 2016 (especially with the stock gains over the last two years), but that’s the best calculator I could find. In any case, it gives you a view that we are arguably in the top 10%. Also, because this calculator is all ages we’ll probably move up the ranks by the nature that we are 42 years old.

Income: Our income changes quite a bit from year to year as my blogging income is not steady. In general, our household income using the same company’s calculator is in the top 80%. However, our costs of living are a little higher than most. The Economic Policy Institue suggests that we’d need to earn $92,949 per year to live “comfortably”.

The Plan: I’ve detailed most of our retirement plans here. There are income streams of my wife’s pension plan, our rental properties, websites, dog sitting, Social Security, and finally, any dividends or drawing down from our retirement accounts. That post is from 2015, so some of the numbers have changed, but most of them haven’t changed too much. I hope to do an update soon and I think the numbers will be even better.

Final Thoughts

As you can tell, I had a lot of good fortune. I had a little bad fortune too, but I firmly believe our household is on the very positive side of the horseshoe.

I was fortunate to learn many personal finance lessons extremely early in life. I was extremely fortunate to marry well. I put in a lot of work to earn the college scholarship, but there are others who put in a lot of work as well. We’ve all be very fortunate to have good health so far (knock on wood).

On the other hand, I’d say that we excelled in the area of “work smarter not harder.” I explained to my new wife in 2008 that she should invest in growth stocks in her retirement account. Months later the stock market dropped nearly in half. Some people would have made a very poor decision in that scenario. When we moved in 2006, we could have sold our condos at a loss, which could have caused us to make up the difference by cashing out our retirement accounts at big penalties.

I don’t know if this article is really helpful to you as you read my writing. I often write about my specific journey or sound financial principles with academic backing that you can verify. I’m never give advice like, “Just get four years of free tuition and you are on your way to financial freedom.” When I do give unconventional advice, I usually clarify it 3 or 4 times explaining why one might consider it while also disclosing that it is unconventional.

If you think there’s anything you’d like to know about me, please ask below. Please understand that I can not answer every question, but I’ll try to do the best I can.

* I can’t imagine what it must have been like to go to the University of Maine. Seems boring.

** I think this is true, but I was talking with a friend recently and it’s possible to double major and not have double degrees. I know I completed both major requirements and I chose to walk with my friends in the linguistics/psychology group even though my focus from day one was computer science and my linguistics classes were mostly fun electives that ending up equaling another major. I’ve heard that some schools don’t give double degrees and some do, but I don’t know what my school’s policy is. In any case, I did the coursework to graduate in both areas.