I Cleared $35K Worth Of Debt While Making $12 An Hour
In 2009, I lost everything. My career, relationship and home. It's amazing how quickly unemployment can knock you down and change the entire trajectory of your life. I went from earning and saving good money to waking up on my 30th birthday living on my sister's couch.
My credit card debt ballooned to $35,000 and my 802 credit score plummeted into the 500's because I couldn't pay bills. Fast forward five years later and I've not only dug myself out of that hole, but I built a business on the way up. I'm currently a speaker, bestselling author, and financial educator running an internationally recognized brand, but before building a successful business I hit rock bottom.
Here are some money lessons I learned from the struggle:
Always Save for a Rainy Day El Niño
There's no way to predict long-term unemployment, but you should always prepare for it with an emergency fund. I lived well below my means to save money before losing my job. Thankfully, I had some savings to live on.
My first "real" job at 21 was as a teacher's assistant. It only paid $12 per hour, so I lived with my parents to stack coins. I found a modest yet affordable rental in New Jersey with a roommate (my sister), that cost just $1100/month, $550 per person including utilities. As my income steadily increased, I kept the same standard of living and a strict bi-weekly budget. I used envelopes filled with cash to divide my pay into categories: bills, savings, entertainment and grooming.
I lived off one paycheck and saved the other.
By 25, I had $40,000 saved in cash.
Live Richer Lesson #1:
Nothing in life is guaranteed, so establishing good saving habits no matter how much you make is invaluable. Downgrade your life, if necessary. This could mean cutting cable, getting a roommate or keeping your gel manicure on for a few extra weeks.
How To Live This Lesson Now:
Begin to set aside a few dollars from each paycheck in a savings account. Don't have the discipline? Start with Digit. This free resource studies your financial moves and automatically transfers money from your bank account to your Digit Account. They will send you daily, fun texts with updates of your balances and transfers. You can choose to save more, pause savings or withdrawal your money via text as well. Your money is FDIC insured and they have a no-overdraft guarantee. Oh, and they do it for free!
Nothing Good Comes Easy
Before joblessness, my savings game was on point, but my investment game was lacking. I made one crucial mistake that put me in a world of debt and made unemployment overwhelming. At 27, I asked a wealthy friend of mine to teach me how to invest and he pitched me a genius plan. We would buy high-end clothing in New York and ship it to Paris to sell in one of his stores.
My return was supposed to be $1,200 per week for two years. Yup, you read that right. I thought I was going to make $62,400 per year shipping clothes across the pond. I was so excited about making racks on racks that I applied for new credit cards and took out cash advances totaling $20,000.
We sent our first shipment to Paris then I never heard from him or received any money. It devastated me at the time, but I can appreciate the lesson. First, be careful who you trust. Second, if a plan sounds too good to be true, believe it. Last, hard work and passion are what will pay off tenfold, not a get rich quick scheme.
Live Richer Lesson #2:
There's no such thing as easy money. When my "friend" aka The Thief shared his get-rich-quick scheme with me, I should have ran for the hills. Looking back on it, it didn't make sense. Rarely in life do you make a ton of money without knowledge and work.
How To Live This Lesson Now:
If you're interested in investing, you first have to invest in knowledge. Two financial books to help you get started are: The Richest Man in Babylon by George Clason, Stock Market Investing Mini Lessons For Beginners: A starter guide for beginner investors by Mabel Nunez.
Odd Jobs Add Up
Losing my job and the implications of bad investing had me down and out. At 30, I was directionless and living off the little savings I had left. I didn't know how to start over after losing so much. Back when I was a teacher, staff members took notice of my money management skills and looked to me as a financial resource.
Looking for something to keep me busy, I began volunteering at several nonprofits teaching financial education. I networked like my life depended on it and asked nonprofits to refer me to other organizations for paid opportunities. Since I couldn't find 9 to 5 work, I did a bunch of side hustles to make money. I took on one-on-one financial consultations, babysitting and tutoring.
Sidebar: Don't discount volunteering. I met my first clients for The Budgetnista by volunteering. By combining volunteering and sharing me in action on social media, I was able secure a new client each time I spoke and posted myself speaking online. In the beginning, 80% of my business came from the posts I shared on Facebook. So use your social media network to showcase your skills and increase your income.
Live Richer Lesson #3:
If there's no place for you in the workforce, make your own way. Use your experience and passions to offer a product or service that someone finds valuable. Hustle even if you have a full-time job. Multiple streams of income will lead to financial security.
How To Live This Lesson Now:
- Use Your Degree. If you have the education, put it to use. You can charge more money for a service when you're an expert in a field. Think about how you can shape your education into an extra source of income.
- Do What You Do For a Living. You can hit the ground running with your side hustle if you have work experience in the industry. There's no learning curve and you have a resume that proves you know what you're doing.
- Activate Your Passion. Start charging for things you already do for free. You already have an established clientele who like your work and you can use them to spread the word.
- Negotiate a Raise. Start to collect all of the amazing value you bring to your job. Put it together in a file. Make sure you monetize your value. Example: The decision you made to do _________ is saving the company $10,000/year.
Take Ownership of Your Situation
At first, I didn't want to face my credit card debt from the bad investment even when I started making money again. I felt paying any more than the minimum payment was admission of guilt and I didn't want to take full responsibility.
Only after owning the mistake and forgiving myself was I able to start crushing the debt. I transferred my credit card debt to cards that offered introductory 0% interest rates, so the money I paid largely went to principal instead of interest. (Use Magnify Money to help you find the best balance transfer cards.) If I had continued to sit back without taking ownership, interest would have increased my debt exponentially.
Since I've been through the struggle, I understand how disheartening financial missteps can be. You feel destitute, desperate and hopeless, but there is a way out if you face the situation. Open the bills, pick up the phone for collectors and form a plan. Sure, it won't happen overnight, but you have the power to change your situation.
Live Richer Lesson #4:
Have you made financial mistakes in the past? Are you currently making financial mistakes? Will you probably make financial mistakes in the future? Yes?! Well, so did Will Smith, Rihanna, Suze Orman, and me!
Sometimes you are unable to move forward financially, not because you don't make enough money, not because you don't have the resources, and not because your situation is un-repairable. The truth is, you have yet to get over your financial mistakes if you want to move onto greener pastures (pun intended). Financial forgiveness is one of the first keys to becoming financially healthy.
How To Live This Lesson Now:
- Admit to Yourself and Take Ownership. Confess; say "I messed up when I __________". Feel free to substitute the word "messed" with your verb of choice.
- Identify the What and Why (Be Very Specific). Take a break from beating yourself up for a minute and clearly identify your mistake and why you made it.
- Tell Someone You Trust. OK, so this may be a tough for you, but tell a trusted confidant. Doing so will allow you to let go of the shame, begin to forgive yourself, and ultimately work on a solution.
- Focus on a Solution. So the truth is out, and it's time that you focus on what IS, verses on what ISN'T.
- Plan, Then Work the Plan. Once you've drafted your list of possible solutions, pick one and begin crafting a plan. Not sure how to start or what to do?
Using these four lessons, I now run a successful business, and no longer struggle financially.
Tiffany Aliche, better known as "The Budgetnista", is America's favorite financial educator and she's here to answer your money questions.
Featured image by Getty Images
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ItGirl 100 Honors Black Women Who Create Culture & Put On For Their Cities
As they say, create the change you want to see in this world, besties. That’s why xoNecole linked up with Hyundai for the inaugural ItGirl 100 List, a celebration of 100 Genzennial women who aren’t afraid to pull up their own seats to the table. Across regions and industries, these women embody the essence of discovering self-value through purpose, honey! They're fierce, they’re ultra-creative, and we know they make their cities proud.
VIEW THE FULL ITGIRL 100 LIST HERE.
Don’t forget to also check out the ItGirl Directory, featuring 50 Black-woman-owned marketing and branding agencies, photographers and videographers, publicists, and more.
THE ITGIRL MEMO
I. An ItGirl puts on for her city and masters her self-worth through purpose.
II. An ItGirl celebrates all the things that make her unique.
III. An ItGirl empowers others to become the best versions of themselves.
IV. An ItGirl leads by example, inspiring others through her actions and integrity.
V. An ItGirl paves the way for authenticity and diversity in all aspects of life.
VI. An ItGirl uses the power of her voice to advocate for positive change in the world.
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How This Creative's Hair Journey Evolved Into A Journey Of Her Return To Self
When it comes to how she wears her natural hair, content creator Ragin "Ray" Al-Nahdy has always seen hairstyles as more than an accentuation of her crown. Ragin has been natural her whole life and has always seen her tresses, no matter their state, as a representation of where she is in her journey of self-discovery and self-exploration. Similar to her journey from childhood to adulthood, her hair would take the shape and form of styling choices that would, in turn, act as the quintessential extension of whatever season of her life she was in at that time, a snapshot, if you will.
"Wearing my natural hair in its many forms, whether that be loose natural or loc’d, has been a big thing for me when it comes to self-expression, self-exploration, and connecting with other people who share similar experiences," Ragin tells xoNecole. "Even in moments where we laugh and joke about the 'struggles' of maintaining natural hair comes with a sense of belonging that I am so proud to be able to relate to."
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Though Ragin has worn her hair in a plethora of ways and was known to switch it up a lot during her 28 years earth side, wearing her hair in locs would prove to be the longest and the most significant time in her journey of becoming. "I think it was necessary because I really needed to have something to help me make sense of what was going on inside of me and ground me in my new reality," she mentions of that time. Ragin was 24 when she started her loc journey, and unfortunately, early on in that journey, her mother passed away.
The way she wore her hair for that season of her life started as a grounding tool for her amid her grief but would eventually evolve into so much more. "I got so many things from the experience I had with grieving my mom, but one of the most special parting gifts that she gave me was a roadmap that helped me 'return to self,'" Ragin explains. "What initially started out as me grounding myself in the connection I started with my mom eventually ended up coming full circle and reminding me that none of the things I was looking for, whether it be the confidence I thought I lost, my connection with my mom or my strength that I felt desperate to hold on to, existed outside of me."
"The locs became a huge metaphor for my life, and through embracing the physical aspects of the journey and learning how to accept and love each phase without the suffering that comes from yearning for past versions of myself, I was able to accept all of the other stuff that was happening in my life that were outside of my control and choose to trust the process and love those things too," she adds.
The 28-year-old version of Ragin had come so far in her life from the time she loc'd her hair at 24. She was older, wiser, and more rooted in herself. Late last year, she gave herself permission to exhale, move beyond the season of her life she had been cocooning within, and embrace transformation. She no longer needed them. Being in her fourth year of grief and more firmly rooted in herself as a woman, Ragin knew it was time to release.
Armed with her metal rat tail comb, Ragin would gently and methodically comb out each of her 117 locs over a number of days. "The theme that whole year was very much about shedding my attachments to things I was feeling unnecessarily dependent on and old energy that didn't feel relevant to my current experience or the one I was trying to create," she says. "I felt a really strong desire to release and make room for my new experiences so that I can be fully present and have clarity."
From the coils and curls of her fro to the twists and turns of life, Ragin's hairstyles have all been outward explorations and expressions of her internal reality, with each style bookmarking a moment in her life journey through the years. As she prepares to enter the next chapter as a mother, Ragin takes us through the different seasons of her life and how the way she wore her hair defined where she was in her journey overall.
Childhood Years
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"When I was a little girl, my mom always loved to do cute styles in my older sister and my hair. She was always coming up with something different and accessorizing with fun barrettes that matched our outfits and sometimes even elaborate braid designs. Most of the time, we even had input on what styles we would get for the day or the week, and I recall those times, as early as three years old, as being some of my earliest memories of self-expression and choice when it comes to how I was perceived by the world. We would always get compliments on how nice we looked, which made me feel so beautiful."
My earliest memory associated with my hair is one of the hundreds of times I used to sit in between my mother’s legs and pick through our huge selection of colorful clips and barrettes as she brushed my hair with gel and conditioner that smelled like candy. The smell of that conditioner was so good I can literally smell it now as I’m talking about it. It has definitely become a core memory for me."
Young Adulthood Years
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"[This] picture was taken in 2015 when I was about 20 years old, right after I grew my hair back out from the experimental phase I went through as a teenager. During that phase, I was honestly just happy that my hair grew back after all of the back-to-back coloring and constant straightening I was doing.
"I don’t even have photos of some of the styles I had during that time because of how often I used to switch it up, but I had red, midnight blue, shades of blonde, and even an accidental green. It was a wild time, but I definitely used it to express myself creatively, which was a lot of fun."
Independence
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"The blonde hair has always been one of my favorite looks. There’s an actress named Reagan Preston Gomez that had brown skin and honey-blonde hair, and I vividly remember seeing her on TV and thinking she was one of the prettiest girls in the world, which was so cool to me because we also share a similar name. I always dreamed of pulling off that look and hoped that it would make me feel about myself the way I viewed her.
"The first time I tried the blonde, I was 18, but in this particular photo, I was 24, and in such a beautiful season of my life where I was out of college with my first big girl job finally feeling like an adult. If I had to name that season of life, I would call it my 'Independence Era.' I was literally living the life that I always imagined I would be living as an adult, even down to the way that I always envisioned myself looking, and it made me feel extremely confident."
Restructuring
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"During my early teenage years is when I really started leaning into my own Afrocentricity because of different books and media that my older brother was sharing with me. I also hold very tight to my Jamaican ancestry and identity which made me interested in embracing the style and journey. Despite being able to choose my own styles as a small child, my mom is actually the one who told me to hold off on getting locs because she felt like I would not stick with it because of how adventurous I was with my look and my hair.
"In retrospect, I honestly can’t say that she was wrong, given the fact that shortly after that, I did everything you could imagine to my hair. By 2019, my mom decided to go on a loc journey, so I decided to join her, and that is how I ended up with locs for over four years."
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"I was 24 when I started my locs, and at the time, I had no idea how much that season would change my life. I initially started my locs with my mom, but she passed away two months to the day after we decided to go on the journey together, which not only left me feeling heartbroken, but I also felt like I completely lost my entire sense of self. I would call that season 'the restructuring' because I literally felt like I had to become a whole new version of myself in order to survive what I was going through.
"I love that my mom always made me feel beautiful and confident in myself by connecting with me through my hair journey, but once she was gone physically, I really struggled to feel confident without her being there to hold my hand and remind me of who I was."
"I love that my mom always made me feel beautiful and confident in myself by connecting with me through my hair journey, but once she was gone physically, I really struggled to feel confident without her being there to hold my hand and remind me of who I was. Since it was the last hair experience that we shared together, I grounded myself in my loc journey and used it to help me rebuild my confidence."
Remembering
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"[This] photo will always be very special to me because it represents my first attempt at doing a full cornrow and braid style on myself, which is something I was never able to do growing up despite my countless efforts. It’s like I had a mental block or something preventing me from actually picking it up. I honestly thought that after my loc journey, I would invite my social media community to join me on a 'learning to braid journey' but then I picked it up within five minutes and did this style on myself almost immediately after combing out my locs.
"It was really special to me because learning to braid so easily felt like another parting gift from my mom, and it also made me feel really close to the Ancestors. Now I’m just wondering what other gifts have been passed down to me that I am still unaware of. I can’t wait to discover them and pass them around to others in this season of life that feels like 'remembering.' It’s really reminding me that who I am is who I have always been and that all of my forms exist here and now without me even having to try to hold on to any particular aspects of myself."
Rebirth
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"Combing out my locs made me nervous at first because I was so comfortable with them, but once I realized what a long process it was going to be, I kinda switched into overdrive and just powered through it. It was a really beautiful process because my sister came from out of town to help me, and my husband helped me a lot, and those two were honestly the MVPs when it came to helping me survive my larger journey with grief, too. It all felt really full circle, and it felt really nice to be supported in that way.
"I got emotional throughout the process, but it wasn’t until I got down to the last few locs that everything really came flooding out. I could just feel a huge weight lifted off of me and things were happening around me that I have always viewed as signs of my mom’s presence. Now, as a 28-year-old woman who is in an entirely different phase of my life than I was when I started my loc journey, I feel strong and capable of everything that the future has to offer me. This season of my life would be called 'rebirth' and I am excited to have my antennas out in the world."
Freedom
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"This photo is actually one of my most recent ones taken after my first curly haircut. I was always the type to just trim off my ends as best as I could at home, but without the understanding of my hair density, texture, and how to shape my hair correctly, I pretty much always ended up with bad haircuts that didn’t compliment me well. Getting my hair professionally cut was a game changer because it allowed me to see the beauty that exists in wearing my natural hair out in a fro. It definitely boosted my confidence.
"This phase of life feels like 'freedom' which is so full circle because it carries a lot of the same feelings and emotions that I experienced as a little girl being able to pick what style and color barrettes I would have in my hair on any given day."
Motherhood
"I was actually pregnant when I combed my locs out but I didn’t tell anyone outside of my immediate family and close friends. I look at my loc journey as my interaction with motherhood from a child’s perspective, and this new journey as me experiencing motherhood from a mother’s perspective. I think that the physical change of identity is definitely helping me move into this next phase as the version of myself that feels empowered and confident rather than the version who was battling with grief and sometimes unsure about herself. While I make sure to hold space for and love on that old version of myself often, I no longer have the desire to relate to her so intimately."
"While I make sure to hold space for and love on that old version of myself often, I no longer have the desire to relate to her so intimately."
"The message I want to pass down to my children and really anyone who will listen is that life is full of tools and opportunities that can assist us in experiencing our lives with ease and joy. Hair and anything else, for that matter, can be used as a way to help us understand our experiences, transform how we view ourselves, and help us form meaningful connections with others that last a lifetime. I also want to teach them the importance of listening to their own guidance and to never forsake their authenticity for acceptance from others.
"I would always talk to my mom about using that sacred time of hairstyling to connect with my children just like she did with me and generations of people have done before us. I look forward to those times and I can’t wait to pass down the stories and lessons I learned while sitting in between my mother’s legs and picking out barrettes."
For more of Ray and her next chapter, keep up with her on Instagram @westindieray.
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Featured image by Courtesy