Four years ago, I graduated college a semester early with nearly $25,000 in debt. Although I was able to start my first job two months later, I had no idea what to do with my money.
I remember going through my benefits package with my mom and her saying to me, “Imani, you should allocate a portion of your salary each month to your 401(k).” My first thought was, “I’m 21. Why the hell should I be thinking about retirement now?”
I felt so lucky that my parents were able to pay for some of my tuition, but I also needed to take out student loans. Because of this, I felt like I was falling behind my peers financially.
Now I know that wasn’t true at all, but at the time I felt desperate to repay my loans. I lived with my parents, was incredibly frugal, and put almost every penny I had into my debt.
I started my money journey feeling like I was behind. There are things I would do differently if I could go back. But I was able to adopt a number of positive habits like regularly tracking my expenses, sticking to a realistic budget, reading a ton of books on personal finance and investing with retirement in mind. anticipated, which helped me get to where I am today.
Now, at 25, I have a net worth of almost $200,000 and I invest 60% of my income. Here’s how I started.
I created a plan to pay off my student debt
Based on my salary and monthly expenses at the time, I created a plan to pay off my student loans in two years. I worked backwards from this goal to see how much I would need to contribute each month to reach this goal.
I ended up paying off my loans in 18 months with extra payments, but I wish I had approached it a little differently.
Just before I turned 23, I paid off my student loans and suddenly had to decide how best to allocate the money I had invested in payments.
At that time, I was against investing because I thought it was something only rich or super smart people could do. However, I started researching how to manage my finances online and came across many blogs, articles, and social media accounts focused on investing and financial independence.
From what I learned, I realized that I could have made more money in the long run if I had invested some of the funds I used to pay off my loans in the S&P 500 earlier. . If I could go back, I would have balanced investing and debt repayment at the same time.
I understood what my work was worth
Although I enjoyed even having a job outside of college, I knew my skills were worth more than what I was being paid at the time.
I researched on websites like Glassdoor and Indeed what employers were paying in my industry and it was way more than what I was earning. I also went through a breakup at that time, which led me to say to myself “Hey, I deserve more in life than what I’m getting, and I have to prove it to myself.”
Video by Mariam Abdallah
This allowed me to start looking for a job. I signed an offer with a fintech company on the first anniversary of my first job at my first employer, which was a 30% increase on my salary at the time.
When I went to give my two weeks’ notice, my employer offered to match the salary. I politely declined because it showed me that they knew they were underpaying me the whole time and didn’t care to do anything until I was about to leave .
I took full advantage of my benefits
When I joined my new company, I decided it was time to really understand my benefits.
I used to only invest in my 401(k) because my mom literally told me that too. But once I did more research, I was more than eager to take advantage of what was on offer.
Video by Mariam Abdallah
I started contributing to my employer and never looked back. I also took advantage of my employer’s ESPP (employee stock purchase program) where I can buy my company’s stock at a discount and they will match it up to a certain amount.
More recently, I also started investing in my employer’s HSA program. I love HSAs because they have a triple tax advantage and my employer matches that as well.
I negotiated at every opportunity
After graduating from college, I was lucky enough to be able to live with my parents for a year and save what would have gone to rent and other household expenses. I finally moved in Jan 2019 and then moved back when my lease ended during the pandemic since I was completely away.
Seven months later, I decided to move back in with my current partner. When we went looking for an apartment, we negotiated everything. In DC at the time, it was a tenant market. With many people moving out of areas where the cost of living is high, many apartment buildings and management companies have started lowering their rental prices.
Video by Courtney Stith
We were able to negotiate lower rent, lower monthly parking fees, and lower rent for our dog. Many apartments had special offers at the time due to the pandemic, and we were able to compare offers between buildings and use them as leverage during negotiations.
At the start of my first salary negotiation, I was not very confident, but I wanted to try. Before my meeting with the recruiter, I watched some YouTube videos on the subject and tried to repeat some of these key phrases to the recruiter.
I showed my appreciation for the initial offer but also explained that my level of experience was more in line with a higher market value. As a result, I was able to walk away with an additional $5,000 added to my original offer.
I spend and invest with intention
Once I paid off my student loans, I ran the numbers and decided that as long as I had three months of expenses saved in an emergency fund, I felt comfortable allocating the rest of that money in my Roth IRA and my brokerage account.
I started investing seriously just before March 2020, which was admittedly quite terrifying for a new investor like me. But after reading books like “I’ll Teach You How to Be Rich” by Ramit Sethi and “Rich Dad, Poor Dad” by Robert Kiyosaki, I understood why long-term investing and diversification are essential.
Video by Courtney Stith
I currently invest 60% of my income and spend the rest on discretionary and fixed expenses. I do this by paying myself first before spending what’s left.
In 2021, I was very grateful for my emergency fund, which was put into use to cover medical expenses for my dog and new parts for my car.
I was also able to set up a sinking fund for things like birthday gifts and travel. And when it comes to spending, my mindset has shifted from wanting to buy the hottest new styles to prioritizing experiences and high-quality items that will last.
I launched my MoneyWithMani website and Instagram in the summer of 2021 with the goal of further exploring my passion for personal finance and helping others achieve financial independence. I believe money shouldn’t be a taboo subject, and talking about it openly will help you and your loved ones succeed financially.
Hello, my name is Imani! I am 25 years old and work in fintech in the Washington DC area. I am a strong believer in investing to achieve financial independence while allocating money to pursue my passion for travel. My goal is to educate Gen Z and Millennials on how to become financially savvy so they can have financial security, retire early, and make smart financial decisions.
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