BEFORE THE PANDEMIC, my father and I would go out for coffee every Saturday morning. I would order a venti mocha Frappuccino with soymilk, which would cost $6, while he would opt for a tall dark roast, black, price $2.50.
As I ordered, my dad would joke, “You millennials and your avocado toast.” In fact, my dad had the same reaction to many of my spending habits. “You spent $50 on a shirt?” he’d ask me, wide-eyed and clutching his chest for dramatic effect.
I often dismissed his banter, chalking it up to his inability to stay abreast of ever-rising consumer prices. I assumed he was out of touch and, in some ways, he was. After paying off his house and retiring several years ago, he held the belief that it was still possible to find a good starter home in Colorado for under $100,000.
Now that I’m a bit older, however, I realize he wasn’t quite so out of touch.
I recently started a career in data analytics. The sudden influx of money, coupled with the expense of living on my own, were a shock to the system. After sticking to a relatively disciplined budget in college—one built on scholarships and part-time jobs—I started my new career by spending as if I were making up for lost time.
I had moved for the job and decided that I was in the market for some new home furnishings, along with a new iPhone, laptop upgrade and new clothes—all bought within a few short months. I blame this spending spree partly on online shopping, which makes it easier to dissociate the items purchased from the money being spent. But I also blame myself.
I went through everything I had in savings. Even worse, I started paying for purchases with credit. I had been approved for a second credit card, an American Express Gold charge card with virtually no spending limit. My first payment on the card almost made me nauseous.
Beyond my dad’s occasional chiding, personal finance wasn’t a topic that was much discussed when I was growing up. Even as an economics major in college, I never took a personal finance class. I believe this is one of the greatest failings of our education system. I was quickly falling into the trap of credit-induced opulence. I was well aware that living beyond my means was unsustainable and yet, at the same time, I was enjoying spending my newfound wealth.
Clearly, I needed an education. I started reading personal finance blogs and watching YouTube videos. The more I learned, the more interested I became. I read The Little Book of Common Sense Investing by John C. Bogle and A Random Walk Down Wall Street by Burton Malkiel. I absorbed personal finance books and podcasts like a sponge, and I reached out to former professors for personal financial advice.
I also posted questions on internet forums about increasing my credit limit—apparently a charge card was a mistake—and would solicit advice from anyone who’d talk to me about personal finance. I had been raised to believe money wasn’t a suitable topic for polite conversation, but people appeared eager to discuss it. My research led me to four key ideas:
All this, however, is easier said than done. The trap of lifestyle inflation is real. Even after consciously deciding that I’d make smart decisions that would pave the way to financial freedom, I found it hard to give up the luxuries I’d already started awarding myself. After enjoying several months of takeout, cooking at home felt time-consuming and my food tasted a little bland.
I’m not a natural saver. Spending makes me happy. I still find myself purchasing little luxuries that I wouldn’t have even entertained while in college. Paying $40 for a delivery from Uber Eats? Sure, that sounds reasonable.
Some days, I question whether I was simply born without the self-control needed for delayed gratification. I think that’s one of my greatest hurdles. But as I continue to work at this, I also find I’m becoming more disciplined. As I write this, my credit cards are paid off, I’ve created a loose budget, my savings account is slowly growing and I’ve opened a Roth IRA.
Still, it’s a balancing act. I want to enjoy life. I don’t want to penny-pinch in a way that leaves me with an uncomfortable lifestyle. At the same time, coffee made at home tastes just fine. I’m consciously forgoing the avocado toast delivery in hopes that, one day, I’ll be able to afford the whole enchilada.
Mariah Davis is a recent economics graduate beginning a career in data analytics. She enjoys sailing and is eager to learn more about personal finance. Mariah is working to expand her financial knowledge with dreams of retiring early, preferably to life on a sailboat.