Who Am I & My Financial Journey
I’m JC! I’m an African American man in my mid-30s (on the older millennial spectrum) living in NJ, where I was born and raised. I'm married (7yrs in December 2019) and have two young kids - toddler and an infant. I'm a government employee making six figures after being with my job for since 2005 right after I graduated from college.
I'm the oldest son of Jamaican parents and grew up in a middle-class environment in a northern city in NJ along with my two siblings. Since the 3rd grade, we lived in a 2 family house and rented out the upstairs unit. My parents were advised to buy a multifamily for that exact reason. Money was talked about in the context of "it doesn't grow on trees", but also very early lessons on the importance of being able to properly count change, count your money at the bank counter when it’s handed to you before leaving and an early introduction to the concept of borrowing costs by my father when I asked to borrow money as a kid. We were encouraged to save when we received birthday money (and other windfalls) or allowance via a piggy bank, which we couldn't access until we turned 13. My brothers and I found a way to hack that unbeknownst to my parents.
Overall, my parents didn't seem to live beyond their means and we enjoyed a fairly modest middle class upbringing. We didn't have any traumatic financial experiences that we knew of (e.g. bankruptcies or foreclosures). We got non- brand name clothes and sneakers. We rarely went out to eat and when we did, the fanciest place we went was Red Lobster. My brothers got hand-me-downs.
Despite that frugality, my parents were willing to spend money on our education. A good education was a big priority in our household and our parents made sure we took school seriously. They sent us to private Catholic schools for most if not all (in my case) of our K-12 education. I did well in school and eventually went off to college on two academic scholarships that covered all of tuition and a portion of housing. I took out some school loans (~$12k in total) over the first 3 years to bridge the gap and worked pretty much all throughout college to support the little spending I did, which consisted mostly of junk food & gifts for my girlfriend at the time. Initially, I pursued Computer Science as my major and then eventually switched to Economics, which I enjoyed and found much more interesting. I switched early enough to still graduate in 4 years with a BA in Econ and a minor in Comp Sci.
Unlike many of my peers (including my girlfriend at the time), I didn’t get any credit cards that were being pedaled in front of the dining hall and student centers in exchange for frisbees and t-shirts. My father said often that "nothing in life is free". And again given early lessons on how expensive borrowing could be, I was able to recognize the expensive path of carrying credit card debt and having to pay finance charges for the charges.
As my junior year was coming to an end, I moved off campus into a crappy apartment where I was able to eliminate the need to maintain an expensive meal plan and dorm living costs, hence which is why I no longer needed any loans. That said, I originally took the loan senior year, but then quickly paid it back within days of acceptance once I realized it would just be more money I would end up paying along with interest after graduation. By that time, I think I began reading Money magazine, which started my self-directed informal education in personal finance. In those pages, I learned about investing, retirement plans, time horizons and correlations to ability to assume risks, etc. By the time I graduated, I had started investing in penny stocks largely due to the suggestion of one of my teachers who mentioned a certain stock that was expected to blow up. It didn't!
I secured my job with a starting salary of ~$49k after a fairly rigorous interviewing process a couple of months before graduation, so I felt pretty good about the outcome of my college experience. As soon as I could, I began contributing 10% (in total) to my 401k and Thrift Savings Plan (TSP), which we got matched on.
I made a couple of adult purchases within the first couple of years into my job. About 7 months into my new job, I bought a new Nissan Altima in early 2006 with the intention of keeping it for 10 years or 150k miles, at least. Note: I still drive that car today after 13 years and over 210k mileage and will continue to do so until the wheels fall off. I also started working a weekend security job to earn more money, which I did for about six months.
About 2 years into my job, I bought my condo using an FHA loan and putting down 3%. Unfortunately, that was pretty close to the peak of the housing bubble and the value on my place had plummeted from $225k when I bought it) to a low of ~$135k. It has since partially recovered and is probably valued between $180k and $190k. While not the best purchasing decision, my family does still live in the condo and we have good neighbors. Although winters in NJ are not our favorite time of the year and we can use a bit more space, we have been making it work. Keep in mind when I bought my condo, I bought it and lived with my girlfriend at the time until she moved out within a couple of years. So, for a while I had the place to myself, which felt much different than a home with my current family, but I digress. We have since paid down the loan considerably, which means we'd still be able to walk away with some cash upon selling despite the capital loss on the property.
Over the years, my salary has increased due to annual merit increases and promotions. During those increases, I tended to increase the retirement contributions to avoid lifestyle inflation and maintain my general net pay. Eventually, it got to the point where one year I maxed out my contributions early, which resulted in missing out on the company matches for the remainder of the year. I made some changes and that has never happened again.
I met my wife at work in 2010 and we eventually got married December 2012. We managed our money using the his/hers/ours buckets prioritizing savings. I’ve dialed back the retirement contributions to better support our living expenses and ability to save in the short term. We've definitely had/have our differences as it relates to money and how it should be used, but over time we were able to build a nice sizeable savings, which includes an emergency fund, funds to be used for additional schooling for my wife and a down payment for next purchased family home. Eventually, we saved so much that we had the ability to pay off our mortgage and become debt-free.
Around that time, I had been listening to various podcasts such as Paychecks and Balances, His and Her Money, Bigger Pockets, Afford Anything and ChooseFI. Based on the info I had been listening to, I convinced my wife that we should purchase a RE investment property, which would potentially yield a higher return than paying off our 3.75% mortgage. The goal was to start this portfolio and grow it so that we could live off the passive cashflow and achieve Financial Independence (FI).
My wife didn't like being in the banking industry particularly in NYC given the long commutes and the field not being fulfilling and aligned with her interests. As for me, I wanted the ability to work on my own terms (i.e. time and place) as a personal finance coach/teacher and have the flexibility to travel more. While this has evolved over the years, we still have the goal of achieving FI.
So, back in late 2018, we bought a multifamily residential property with 5+ units in Northeast PA from a friend and former co-worker. That friend had been investing for over 10 years and had a massive portfolio (over 150 doors) that he was looking to sell off some properties and shift his money into other projects. So far, it’s been a profitable venture and we’re looking to build on that success.
Over time, through a combination of saving, investing and the upward drift of the stock market, I have grown my net worth, the bulk of which is held in retirement accounts. Given our aspirations to have the option to leave our traditional jobs, it’s important that we build our passive cashflow and easily accessible funds that could sustain us until traditional retirement when we can then access retirement funds.
We’re excited to see how our path unfolds, but in the meantime, we’ll continue to look for opportunities to make smart investments and build our passive income.