Welcome to Money Talks! New approaches to money have exploded. Yet, money remains taboo. Less than half of you share personal finance information with your friends and family.
But that’s all changing. Now more and more of you are talking about money because it leads to better outcomes.
In an effort to provide personal finance insights through transparency (and have a bit of fun), I’ve created a series titled Money Talks that showcases how real people in Charlotte approach money.
It’s an anonymous way for you to share your money experiences and insights with our city. Answers are lightly edited for clarity and privacy (ex, exact age). Want to participate? Take the Money Talks survey.
Living situation:
We own. I got lucky and purchased a new townhome in 2020 in a growing part of Charlotte. I was able to get a low price and a low rate.
I used the equity I had in the first home to take out a home equity loan that I used for a down payment on our current house. I still own the first one and rent it out.
This certainly isn’t easily repeatable because so much of it was luck with timing, but the area has appreciated so much that I’m able to generate enough rental income to roughly break even on the property management fee, repair costs, the mortgage, HOA, and home equity loan payment.
I really don’t subscribe to the Dave Ramsey methodology of essentially having no debt. If I can get access to capital at a reasonable interest rate, then I’m going to use leverage.
Children:
We have a newborn. It’s been an eye opening experience to say the least. My wife is a 1099 with her job, so she doesn’t get paid leave, and our son has had medical complications, so we can’t utilize a nanny or daycare as early as we anticipated.
We’re trying to make sure we balance the opportunity cost of her not working with the money we aren’t spending on daycare while also considering the added expense of all our doctors appointments, specialist visits, and the looming surgery. It makes saving for his college seem like the easy part.
Job:
I’m an operations executive. My base salary is $250K with another $100K in potential bonus each year based on financial goals for myself and my team.
Salary journey:
I started my career out of college making roughly $50K/year as an entry level analyst for a boutique consulting company.
After about a year of that, I made the jump to a local startup where my “salary” decreased notably. I was one of the first employees, and we were all paying ourselves next to nothing to get the company off the ground. As the company grew, however, more and more opportunities presented themselves for growth within the company.
If I could give anyone advice here (not that I’m qualified to do so) it’s that no one is going to have your back other than yourself. No matter how much you like, trust, or respect your employer, if you don’t advocate for yourself at every turn, you won’t get as much as you can.
Never Split the Difference by Chris Voss is a great book on negotiations that I think everyone (even if you aren’t negotiating salary) could benefit from reading in some regard.
Side hustle:
I own a small arcade business on the side. It’s been a side hustle of mine for the last 7 years or so. I make about $25K a year doing it with minimal effort. It was something that I had some exposure to via a family business and previous jobs. I thought to myself “why am I not doing this?”
I took some savings, bought my first machine, and the rest was history. I have arcade games in 6 locations now.
Work-life balance:
This has ebbed and flowed over my career. Startups are demanding.
There were years where I had essentially no work-life balance. Even when I’d be at a Charlotte FC game or something, I’d be responding to work emails and texts like my life depended on it. This has gotten better over time.
Debt:
Only what I would call “good” debt. There is a mortgage on the two homes we own (in addition to the home equity loan on the first one) and both my wife and I have a car payment (both used cars with very manageable monthly payments and term lengths).
The first home is a 3.25% rate, the second is 6%. One car is 2.5% and the other is 6%. Timing is really everything on these rates.
Credit card:
I have several.
I use a Bank of America Cash Rewards card for 3% back on gas, Capital One Savor Card for 4% back on bars, restaurants, and amusement (I’m a season ticket holder for a couple of the teams here, so getting 4% off on those tickets is nice), Amex Platinum for travel related expenses and points related items like the transfer portal, and the Chase Amazon card for 5% back on Amazon purchases.
I use them all like debit cards and pay the entire amount off each month, so I’m just trying to maximize my “free” money.
I got lucky with the Savor card and was grandfathered into no annual fee, but with cards like the Platinum, you have to make sure you’re taking advantage of all the monetary perks, or you’re just spending money on a fee for status.
Budgeting:
Probably not as much as I should.
I know my monthly expenses well, I have recurring weekly savings and investments set up, so I never even really see that money hit my account before it’s in a different one, and I don’t overspend.
This isn’t as active as using an app daily, but everyone should sit down and look at their monthly expenses and goals and determine what their goals are. Once that’s set, automated investments and savings should be implemented. I do mine weekly, but I know people who like to structure them on payday. You’ll then get used to it.
As an example, instead of seeing the whole paycheck immediately, you’re only getting 80% of it with the other 20% going to investments. Mentally, you should (hopefully) start to adjust your habits to match this and never have to touch the invested money.
Splurge:
Sports. A lot of my discretionary income goes to attending Panthers, Charlotte FC, Hornets, and Carolina Hurricanes games. Very little compares to being in the stadium for big games. I love getting to spend time with friends at these events.
I also collect memorabilia as a hobby, so I’ll spend some money on a cool card for a player I like or something like that.
Charlotte money hack:
The light rail is painfully underutilized. It has a ton of convenient stops, and a lot of those stops have parking lots. If you’re going to drive, why deal with uptown traffic after a concert or sporting event when you can park in LoSo for way cheaper, light rail in and back, and be on your way?
Restaurant pick:
Bentley’s in SouthPark is phenomenal. I haven’t had a meal there that I didn’t enjoy. Their oysters are my go-to. For your entree, go with the lamb chops.
Investment and saving strategy:
I have a small amount go into a high yield savings account each week (roughly 4% APY right now) for use as a sinking fund. I don’t follow the standard advice of 3-6 months of expenses in savings. I try to invest as much as possible.
I use one of the many robo-advisors out there (Wealthfront, Titan, Betterment, etc.) and have loved the experience. It’s much cheaper than having a wealth advisor, and while there isn’t as much hand holding, the difference in returns is essentially nonexistent. I have a Roth IRA with them, general investments, my savings account, and a 529 for our son. You can also link in other assets and liabilities to have it give you a full net worth picture with projections based on your goals.
The robo-advisor I use offers immediate deposits if you want to borrow against your investment account, so if I was ever in a pinch, I could borrow a good amount of money at a ~5% interest rate. This is why I don’t put as much into savings. I’m going to get a higher return on invested capital, and it’s still liquid enough to where I can access it quickly without selling anything.
I also put money into several different crypto currencies weekly. This is all money that I am mentally okay with it going to $0, but I want to be on the field instead of on the bench if crypto continues its long term growth trend.
Savings goal:
I’m just trying to get as much money working for me as possible. I want to be “work optional” by the time I’m 40, so the more money I can get working for me, the more likely I am to achieve that.
Net worth:
Roughly $700K right now.
A lot of this is due to diligent saving and investing, but I’d also be lying if I said my parents didn’t help me out. I was incredibly fortunate to graduate college with no student loan debt thanks to my parents, and they also assisted with both house purchases with money they had earmarked to go to me via inheritance.
This is obviously an advantage that not everyone is afforded, and I’m very thankful to have had access to that and can’t pretend like this is something we did entirely solo.
Retirement:
I’d like to have enough money to not have to work a 9-5 by the time I’m 40. I don’t know if/when I’ll truly “retire” completely.
I’d like to get involved in consulting to continue to bring in some income while also having something to occupy my time.
I also want to get better at golf, but I could see myself becoming a member at one of the clubs around Charlotte and playing a lot more.
How would you need to feel complete financial freedom?
Probably around $10M. Enough money to comfortably be able to pay off all our debts tomorrow and still have enough generating income to where not having a job wouldn’t hinder our ability to live the lives we want to.
What do you consider “rich” in Charlotte?
The upper echelon is probably $50M, but I imagine you could do almost everything you’d want with $10M. There are definitely tiers to being rich. Charlotte has some pretty affluent areas and people.
Best money decision:
The best is investing early and often. The earlier you start, the more time the money has to compound.
So many people psych themselves out by thinking it’s not a good time to invest for whatever reason. Time in the market beats timing the market almost every time. Just dollar cost average by setting a recurring investment and letting it ride. That strategy will be better than anything else for almost everyone.
Worst money decision:
Cars are terrible “investments” as a general rule. It’s an objectively bad decision to buy a new car especially if you’re financing most of it at a term that’s 7+ years.
I bought a used car that seemed good during the test drive from a dealership that I trusted, but it turned out to be a lemon with a number of issues popping up over the course of the first year. Having to trade it back in for another one was an expensive experience.
Knowledge:
Some from my parents, some from my first job out of college, and a lot of self learning just from listening to podcasts and reading blogs/newsletters.
I highly recommend talking to friends. Money is viewed as a taboo subject, and it absolutely should not be. We all make different amounts, and we’re all in different stages of life, but without talking and learning, it’s a lot harder to put ourselves in a better position.
I’ve found so many of my friends who just had money in a savings account thinking that’s what they were supposed to do and were nervous about the stock market or other forms of investing. Without having open conversations, they may have left an exorbitant amount of money on the table over time.
Money Talks is a weekly series showcasing how real people in Charlotte approach money. Participate.
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