Here’s the first international 20something money story… about a 27-year-old living in the Down Under.

I don’t have a blog, but I’ve been thinking of starting one when I have the time. So for practice, I thought I’d write my money story. I know your focus is on demography rather than geography, however my location is my main point of difference – I’m a twenty-seven year old grad living in Melbourne, Australia.

I’ve had an interest in personal finance since I first started earning an income working part-time at university. I don’t know how it happened. One day it just dawned on me that, seeing as I didn’t know what I wanted to do with my life, getting the best marks I could in all my subjects, and saving as much money as possible, could only be a good thing. So, taking advice from my mum, (whose been a personal finance geek all her life without ever realising it), I set about making sure I didn’t pay bank fees I didn’t have to, making sure I had the cheapest mobile phone deal, earning the most interest possible on my savings etc.

Once I had all of this down pat, I ventured into purchasing shares. I bought some shares in a casino and a building products company, but not really knowing what I was doing, I sold them when they went down. A few years later I bought a book on buy-and-hold share investing called “Retire Rich and Early”. (I was so embarrassed by the title I kept it in a drawer rather than on my bookshelf!). From that book I learned how to pick quality stocks that pay dividends I can reinvest.

The sharemarket, however, is not something I have a lot of spare money for anymore as I bought my own three-bedroom unit in a decent suburb of Melbourne a couple of years ago. I achieved this by living with my parents until I was 26 (Australians tend not to go away to college unless it’s really necessary, and with housing so expensive, never leaving home until you’re in your late 20′s is becoming quite common), and by having a small inheritance from my aunt.

If it weren’t for the inheritance, I probably wouldn’t have bought such a large property. Conventional wisdom would suggest I’ve done the wrong thing by purchasing a property that’s too big for my needs with mortgage repayments that are a little restrictive. I’m happy with my decision though, because I’ve been able buy into a good area that has increased in value, and the unit is large enough for my fiance and I to live in even when we have children. My aim now is to pay as much off my mortgage as I can, as quickly as I can. My fiance has started his teaching this year, so with his income as well, this is much more achievable.

The area that I have really neglected is my career. I completed a Bachelor of Arts, majoring in languages. I didn’t know what I wanted to do after that, so for the past five years I’ve been floating around doing dead end admin and retail jobs and travelling overseas. This year, I’ve finally decided to go back to university full-time to complete an Accounting degree so I’ll have some career prospects, rather than feeling like I’m going nowhere fast.

I don’t intend to work in accounting for the rest of my life; I’m hoping that the steps I’m taking now will allow me to “retire rich and early”, so I can do something I really want to do, such as a Masters/Phd in historical linguistics, opening a homewares shop or renovating houses.

Wow – Melbourne Girl bought her own place at 26. That’s really admirable. And MG – tell me, is living in Australia really as awesome as it sounds? Do you go snorkeling? ‘Cause it sounds pretty awesome.

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Money Story #2: Elizabeth in SF
Money Story #1: Emily in Austin, TX

This is the story of “Elizabeth,” a 27-year-old who works in the IT field in San Francisco.

I had to think long and hard before I decided to respond to the profile challenge for two reasons. The first being that I am not a very good writer and the second being that my story is very common. However, one of my resolutions for the year is to improve my writing and you can’t improve if you don’t take a chance. As for the second excuse, well, maybe my story can help someone else.

I am currently 27, living in San Francisco and in the IT field. The catch is that I have only been financially on my feet for the past six months. When I first graduated college I was very lucky, I only had a couple thousand dollars in debt from the last semester’s living expenses and my parents had given me a semi-reliable car. In addition, my new job was in the DC area and my parents lived there too so I could even live with them for a few months until I found an apartment. So how did I go from having every advantage to screwing up so badly? It was easy, pride. Looking back the signs were obvious but at the time I had no idea they were even signs or mistakes.

I found an apartment with a friend and it was great, even within my admittedly mostly theoretical budget. But I didn’t start saving for an emergency fund, instead I went shopping and signed up for a couple of new hobbies. I had been living on an extremely tight college budget for four years and I was ready to start living. I was lucky to be making a fairly decent salary so I wasn’t even racking up debt. But then my car had a problem. Nothing major but it did take up about $800 which needed to go on the credit card. And I couldn’t pay it off right away because I had already signed contracts for those expensive hobbies. Since I didn’t have a budget really, I couldn’t look at it and start cutting in various places like eating out and book buying. So I just shrugged my shoulders and figured it would be fine.

Then another car failure for another $600. And then I went on vacation. Yes, that’s right, having roughly $2000 on my credit cards at this time, I decided to go on a very expensive vacation to Honduras (which was extremely fun by the way). When I came back I now had about $5000 on my credit card. Without an emergency fund it was easy to rack up debt. I would just start to get a handle on the card when BAM! another problem or vacation would hit.

In the next two years, two more major car maintenance problems hit before I had to buy a new car, I took another vacation, this time to Africa, and I moved to a more expensive apartment, all while living the exact same lifestyle (buying clothes, enjoying my hobbies, eating out for lunch every day) as before all this debt piled up.

And then the best thing happened to me. I met two very wonderful European women who helped me get over my pride. Since in our society we don’t talk about money and problems, I have no idea how it came about but one day we started to talk and my immense stress of having roughly $18000 in credit card debt, a $15000 car loan and 2 personal loans (for hobby toys) of roughly $3000 each came out while living in apartment that I couldn’t afford. I didn’t go into specifics with them but we did talk about the fact that I had enormous debt and I couldn’t afford where I was living. I was reluctant to face facts and make drastic changes in my life but with their help and support I did.

Like most kids growing up, once I left home I passionately didn’t want to return. Partly because I liked the freedom of living on my own but also because in my mind, moving back home was admitting failure. But these two ladies brought up a very valuable point, that parents are there for help, that it is not failure to go back home and that the only failure would be to ignore my problems.

My pride still wouldn’t let me just move back home and frankly my lease wasn’t up but at this point I was opened to ideas that would let me ease my situation. At this point, a job opportunity popped up at my company that required weekly travel to the Denver area for the next six months and I took it. Two weeks later I had invoked the clause about moving states for a job, put all my stuff in a storage container that cost about a sixth of my current rent without the utilities and I took two suitcases of clothes to my parents house. I spent the next two years of my life on the road, which sucked, but I managed to pay off all my debt, build up an emergency fund, and learn some very valuable lessons about money, family and pride.

Having saved up some money, when the opportunity came to take a non-traveling job in the city of San Francisco, I jumped at it. I’ve been here for six months now and I have rebuilt my emergency fund, kept a very strict budget no matter how much I hate it and pay off my credit card every month.

This story might be pretty common but for me it was very hard and took a lot of courage to swallow my pride and ask for help from the two people who wanted to give it to me, my parents.

I want to thank Elizabeth for sharing this story. I think those two wise European ladies said it best, “parents are there for help, that it is not failure to go back home and that the only failure would be to ignore [your] problems.”

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Money Stories:
#1: Emily Starbuck Gerson in Austin, TX

***If you are a 20something who would like to share your money story, I’d love to have it! Please email me at wellheeled – at – gmail – dot com.

This is the story of Emily Starbuck Gerson, a 23-year-old who lives in Austin, Texas, and works as an editorial assistant at CreditCards.com.

Living without credit
I grew up without much exposure to credit cards. My mom mostly wrote checks, and my dad (a criminal defense attorney) paid for everything in cash. I was taught to save until you could buy something, which is still a great lesson. My first major purchase was a Sega Genesis in first grade, which I still own (and still works). I painstakingly saved my $1.25 weekly allowance until I could afford it.

As I grew up, the more I heard about the horrors of credit card debt, the more I became afraid of credit cards. When I turned 16 I received a copy of my mother’s MasterCard, but it was for gas and emergencies only, so I just thought of it as Mom’s money. At university, my college fund, part-time jobs and some allowance sustained me. I thought I’d never need anything but my debit card.

Then one day in college while shopping at Victoria’s Secret, I said yes to the offer for the perk-filled Angels Credit Card. I said no a million other times, but when I learned you could pay it off in-store following the purchase, I caved. I was promptly denied, but I didn’t really understand why. I later learned that store credit cards have very high interest rates, which can be dangerous if you carry a balance…so it is probably best I didn’t get one before I truly understood credit responsibility.

Credit enlightenment
When my boyfriend got his first credit card last year, I said it was stupid. He sighed at my ignorance and said we must demonstrate responsibility with a credit card in order to build good credit, which was vital for the future. Ironic. I called my omniscient mother for confirmation. She agreed, and added that I couldn’t get a home or car loan without credit. Not to mention rent a hotel room or car. Having no credit apparently isn’t much better than having bad credit.

Half-way through my last year of college, I went to my bank (BofA) for a credit card. They gave me the Student Visa Platinum Plus — a no-frills beginner’s card, even though it sounds fancy. I can manage it online with my other accounts, so it’s really easy to transfer money and monitor balances. If it is possible for you to get a card through your bank for that very purpose, I highly recommend it.

Saved by the credit card
I began making occasional purchases with the card, even though I didn’t have to. I thought it was silly. After graduating, I had a PR/marketing job for a few months, but the company shut down. When I found this job, I was psyched…especially to learn more about personal finance, now that I realized I knew very little. The problem? I had 10 days between the two jobs, and my first paycheck was for only a week’s work. It would be three weeks before I was paid again. At first I panicked — I had money in savings, but I didn’t want to completely drain it. And I’d just told my dad I was ready to be financially independent. What’s a girl to do? Then I remembered I had a credit card! Hallelujah.

In those weeks, that credit card saved my behind more than once. One example: when my dog began copiously vomiting, I raced her to the vet. I was thrilled the tests showed she was OK, but felt sick myself when the bill totaled $240. With no income to cover it, I put it on the Visa, knowing I could pay it off with my next paycheck.

Lessons learned
It’s a huge relief to have a credit card as a back-up, as long as you remember the money you’re spending isn’t yours. Because I have been so careful about paying my balance off, my credit limit was recently raised. That’s a plus you get for being responsible, though avoid a high limit that will tempt you to spend way beyond what is necessary.

The most important thing I’ve learned is that building good credit is vital. When you apply for car insurance, they run a credit check, and those with worse credit usually have higher rates. When you apply for a job, many companies run a credit check to ensure you are financially responsible. When you apply to rent an apartment, a credit check determines whether or not you have a reliable payment history. Having bad credit or no credit can make your life incredibly difficult.

After learning all about reward cards for my job here, I felt like I was missing out with my plain-Jane student card, so I recently applied for a new card through my bank. My good history thus far allowed me to be approved. My credit limit is a measly $500, but I will soon prove worthy of a higher one. The reward program gives me an excuse to make purchases with the card. I am excited about a credit card for the first time, and it’s a cool feeling. I was also approved for an Angel’s card after building credit with my student card, though I haven’t once remembered to use it.

The moral of my story
If you are young and devoid of a credit card for whatever reason, strongly consider getting one. It’s a prime time to start building credit and learning how to be financially responsible. If you’re clueless, your bank can help you decide which card is best for you. But beware; if you get a student card, know that they come with a higher interest rate than regular cards, so late payments can really rack up debt. Always remember: What you put on a credit card isn’t your money. It’s a loan you must pay back.

Visit Emily’s blog for more!

One of the best things I enjoy about writing a blog is to getting to hear other people’s stories, especially from young professionals like myself. And, inspired by My Open Wallet’s NYC profiles, I wanted to do something similar but to switch from a geographic focus to a demographic one.

I’d like to invite 20-somethings (men OR women) to share their money tales.

If you have a beer budget or lead a champagne lifestyle (or both!), if you live amidst the bright lights of San Francisco or in the heart of Texas, if you can calculate compounding interest to the nth degree or if you know more about Ross from Friends than about the Roth IRA – I want to hear your story!

If you have a blog you’d like me to link to, I’d be more than happy to do that as well.

The profile can be as broad or as detailed as you want – of course, in-depth profiles are always the most interesting ones. And everything can be as anonymous or as open as you’d like.

Information that would be helpful to give a context: your age (or a range), your location, and your occupation. You can write about basically anything – how you paid off debt, how you got into debt, what’s your philosophy towards money, if you and your partner have different money styles, what scares you about investing, how you bought a house, etc. etc.

The possibilities are endless!!

So please please email me at wellheeled (at) —- gmail —- (dot com). I’d love to hear all the stories out there, and I’m sure my readers would too.