Baby’s First Year = Expensive Amnesia

2014

Starting net worth: $0

Income:

Leslie: $29,300

Ben: $38,000

Turns out I lied about stopping all other side gigs. We weren’t making ends meet, even after Leslie got all her classes back. We were both teaching a full day, no free periods or study halls (both of which would have cost us money in the form of lost income). I was still tutoring at night and coaching a sport for extra cash. Weekends were spent fixing up the house (we only fixed the bare minimum to live in last year. This was to get out from under a terrible loan.)

Looking at my tax returns, these side gigs made me about $10,000 dollars.

But I didn’t even notice it. Money was going out the door as fast as it came in.

How We Saved

We were actively trying to save money now, but something was always breaking. Car trouble, home repairs, kid. We needed to replenish our emergency fund ASAP.

But we didn’t even manage to save $200 per month. If we hadn’t given up on ‘normal budgeting’ and switched to a pay-yourself-first plan, we would not have a dime.

The amount of work that went into getting essentially nowhere was soul-crushing. It was one of the biggest reasons we began looking for other jobs and learning about investing.

I had been studying finance as a side-track all the way back to 2005 or so, after taking an economics class in college. I had a professor who made most of his money in the stock market. He seemed like some kind of financial wizard and I desperately wanted to learn more from him.

But, my academic track prevented me from taking more of his classes. I was already taking over twenty credits per year, and I decided to take his classes when things cooled down.

This would prove to be one of the most expensive mistakes of my life.

By the time I could take those classes, that professor had retired and moved home to Bangladesh. I had to settle for self-study.

By 2014, I knew everything I needed to know to invest properly (what I learned in 9 years could have been learned in 9 minutes, but oh well). The only problem now was there seemed to be no money to invest.

(The investment philosophy we still follow to this day was about 90% complete at this stage. I was still missing one crucial piece of the puzzle.)

BTW, we still had no cable, we were drinking no soda. Our expense report for this time period was flawlessly tight. I don’t think we spent a single dollar on anything frivolous or fun this whole year. The house, and the kid, ate it all.

This is why I hate financial advice like ‘just give up your latte’.

This is why I hate budgeting.

We were doing both and it still wasn’t enough. Advice like this is for people with high incomes and low discipline. But I believe that many who struggle have high discipline, but low incomes. More on this later.

This was sort of a lost year. Between sleep deprivation and the extra work, I barely even remember this year. Having a baby is like getting amnesia.

Expensive amnesia.

How We Spent Money

New Siding. New Windows. New Floors. New Roof. We didn’t go out to eat. We didn’t go out for drinks. I don’t think we even went to the movies.

But wait! Don’t think for one second we skipped these things because we are following the ascetic path to riches touted by many of those “stop buying latte” types. We skipped these things because we had to. We wanted to go to the movies. We wanted to enjoy life.

We just weren’t making enough money to thrive in our area. We needed more income.

We began looking for side hustles.

Assets

Equities @ Cost: $0

Cash/Equivalents: $2,000

Ending net worth

$2,000

On to 2015 ($2000 – $9,000)

Back to Income Reports

Closing Thoughts

This is when we began looking into side hustles.

I’m willing to be this is when most people begin looking into side hustles.

And I’m willing to be we all followed a similar path, one that led to promises of passive income in one form or another.

“Passive Income” still makes me shudder. There was just so much false hope tied up in that phrase.

But we’ll save that story for another show.

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