I wish financial literacy was part of high school or at least college curriculum so that I did not have to learn the hard way about using my credit card wisely, making payments on time and managing money in general.
If I had managed to save just a 1K from the day I received my first paycheck I would have had:
8 years = 96 months
96 months * 1000 = 96000
I am not even applying the standard 4% minimum interest rate for putting the money in a savings account.
The constant sermons I received about saving money for my future and not making unnecessary expenses did not help.
I would just shrug and get defensive and provide counter arguments.
Like a child who does exactly what he is told not to, I too acted in a similar manner.
Whenever I made up my mind that maybe I need to save some money and would approach people for advice on the best way to save money I would end up getting more confused than ever and just give up.
Then it happened I fell in the credit card debt trap and kept paying the minimum amount due months on months but the total amount due never seemed to reduce.
I was living from paycheck to paycheck with virtually 0 savings and just getting by each month. I made a mistake of making a payment before the due date and not disabling the standing instructions for auto debit. I ended up paying double the amount I had planned to pay and was left with little to no money for that month.
Those very depressing and frustration 20 days that I had spent, its memory fresh as it happened yesterday. When you have no money in your pockets it feels like joy and happiness has been sucked out of your life.
Even though it was dark phase it came with silver linings.
From the next month on, I trimmed my expenses to the bare minimum and started saving money to pay off my debt apart from the monthly minimum payments.
After every couple of months or so, when I had a decent amount of cash, I would make an additional payment resulting in a lower minimum due every month. In a couple of years I was able to pay off the debt but thankfully the habit of saving did not go. Over the next 1 year, I had saved a decent amount of cash to buy me a MBP & the surplus savings I had helped me through the 7 months I lived without a paycheck. I wish I had penned my notes then and which is exactly why I feel a pocket note book should be part of EDC.
I had forgotten all about it until I recently when I was about to go through the same thing again.
One lesson that I have learn is that what matters more than you earn is how much you are able to save.
I hope I remember this lesson for the time to come.