«
»

How I Did It: Early Years

This is the first in a series of weekly posts titled “How I Did It”.  Throughout this series I will be describing my methods of personal finance, frugality, and what it took to get where I am today.

I like to think that I started my journey toward financial freedom when I turned 18 with my checking, savings, and credit card.  However, the more I think about it, the journey began early in my childhood with my parents.

College Savings as a Toddler
My parents opened up a joint passport savings account for me at a local bank.  Any and all gifts of cash went here for college.  The amounts were small, but they sure added up!  Between cash gifts, U.S. Treasury EE Bonds, and compounding interest, I was able to apply this towards a large percentage of my one year technical school.  This was excellent, but I had many more years of schooling to go.

Let’s say for example you are to put $100 away every month for your child.  Over the course of 17 years, at a 2% interest rate (let’s hope the rates get better), this would yield $24,313.46!  You would only make $3,913.46 in interest, but it’s $3,913.46 you did not have.  As of this posting, that’s about one semester at a community college here in New Jersey.

Savings Through the Years
Once I was older, I found out that money was a way to obtain things.  I did not want to save my gifts of money; I wanted to spend it.  However, my parents still encouraged me to save most of the money while keeping some in my piggy bank.  I enjoyed seeing my money grow in my piggy bank, so saving became a habit of mine.  I feel having the actual money in hand helped me as a child to save for bigger things.  Instead of wasting a dollar at the corner deli on some candy, I would save it for something bigger and better.

In order to stay on track with savings or to reach any goal, it’s best to make your actions habitual.  With direct deposit, online savings accounts, and bill pay, you can automate a lot of habits so you do not even need to think about it.

Getting my First Checking, Savings, and Credit Card
After I turned 18 in late 2004, I went over to Wachovia so I could open my Free Student Checking and Savings accounts.  While I was opening the accounts, they asked if I wanted a credit card.  Hesitant at first, I asked a bunch of questions and went for it.  It took about a week to receive the approval letter with a $500 limit.  At the time I did not have a full time job; I did freelance computer consulting.  I treated this card VERY carefully and only put purchases on here that I knew I could pay off every month.

When did you open your first checking, savings, and credit card accounts?  Did you do things in a particular order?  Any reasons why?

Tags: , , , ,

This entry was posted on Friday, January 15th, 2010 at 10:40 pm and is filed under How I Did It, Savings. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

5 Responses to “How I Did It: Early Years”

  1. Steven M. Says:
    January 16th, 2010 at 12:15 am

    I got a Wachovia account also, this was back in High School. I started the Way2Save option, they put $1 from each debit purchase into a special savings account. I haven’t had it for long, but there is already almost $500 in there. It adds up, and it’s great to have.

  2. Gabe Says:
    January 17th, 2010 at 11:25 pm

    Back when I opened my account, they did not have the Way2Save option. I just have the standard free checking account. I had my savings account closed out due to inactivity (and no funds). This was because I discovered INGDirect!

    Let me know if you would like an invite. If you put $250 in, you get a $25 bonus!

  3. Todd G. Says:
    January 21st, 2010 at 2:34 am

    I actually just start my checking account maybe 2 or 3 years ago. Before then I had a joint account with my parents. I think its important to have your own personal account this way you understand the concepts of whats really going on. When I made the account they gave me a VISA bank card which is amazing. I DO NOT recommend credit cards, I feel that they make the user have an assumption that they have “unlimited” funds. A great example of this is how many people are in actual debt.

  4. Gabe Says:
    January 21st, 2010 at 9:44 pm

    I agree with your checking account standpoint. I do not entirely agree with your credit card one. However, I understand where you are coming from. When I first checking account, I was against the idea of getting a credit card because of getting sucked into debt. When I was offered the card, I was very hesitant and it took me a little while to jump on it.

    I think that having a low ($250 – $500) credit limit helps someone worried about credit cards get on the right track. I just made sure I had the money every month to pay it off. Credit cards have also helped me in unexpected events and while traveling. If I did not have the cash to cover an unpredicted need (flat tire, etc) this would off-load it until I get paid. When I get paid, I make a transfer from the checking account to my “Visa” savings account. I try not to touch my savings account unless it’s absolutely necessary. It can be quite a balancing act!

  5. PocketCoinage.org» Blog Archive » How I Did It: Credit Cards Says:
    February 16th, 2010 at 12:09 pm

    [...] you’ve read the series from the beginning, you’ll notice that I received my first credit card when I opened my checking and savings [...]

Leave a Reply

Disclaimer: All information provided on this site is for informational and entertainment purposes only. PocketCoinage.org will not be liable for any errors or exclusions in this information; or for any damages occurring from its display or use. PocketCoinage.org may be compensated through advertising, affiliate programs, or in any other way.

Switch to our mobile site