In September 2018, this woman from Texas, then 36, wrote to the Moneyist to ask how she should invest her windfall — over $150,000. It was small by some people’s standards, but it was life-changing to her. She didn’t have a college degree, said she would never earn more than $30,000 a year, and worked full-time for $15 an hour, in addition to a part-time job at $10 an hour. She paid $1,050 a month in rent.
She paid off her car, and bought a “tiny home,” which she owns free and clear, she wrote in an update a year later. She deposited $70,000 in a high-yield online savings account. She topped up her retirement portfolio and invested $30,000 into emerging markets. She maxed out her IRA and invested $10,000 between very safe dividend stocks and ETFs. She also spent $7,000 on dental work in Mexico.
And today? Five years after her first letter, she has updated MarketWatch readers on her progress, and what she learned from this experience:
Dear Moneyist,
There are a lot more Americans making less than $50,000 a year than there are those who make more. I feel like we aren’t really represented in the financial-advice world. I’d love to see more columns helping people to invest $25-$100 when they can. It’s empowering to invest. I might never be a Warren Buffet, but when I open my accounts and see how they are growing it really fills me with a sense of pride and determination.
As to how I’m doing? Beautifully. I hate to say it but the pandemic was a blessing to me personally. I feel terrible saying that because of the loss and devastation so many others suffered and are still suffering because of it, but for me, the pandemic opened up a world of possibilities. A job opportunity landed in my lap because of the shutdown, and I’m making almost $4,000 a month now after taxes.
Yes, me! I’ve never made so much money before (outside of the inheritance I received). I am still frugal and live off of about $1,800 a month, and that includes health insurance, long-term disability insurance, full-coverage car insurance, and pet insurance! Everything else goes to savings and investments. I won’t say what it is I’m doing because it might identify me, but I will say it is a job that allows me to be happy every second I’m “working.”
“‘Tiny living forces you to be mindful. Not only of your space, but also of yourself and how you live in your space.’”
My tiny house has been one of the greatest decisions I’ve ever made, and has truly changed my whole mindset on what makes me happy. As I’ve lived in it I’ve altered certain parts of the design to be more efficient, and I can honestly say I intend to live tiny until some mobility issue — hopefully age-related and not an accident of some kind! — forces me back into a more conventional dwelling. Tiny living forces you to be mindful. Not only of your space, but also of yourself, and how you live in your space. It might sound strange to hear, but living tiny has truly made me a better person and improved my quality of life in ways other than financial.
I would like to address some of the comments I read in response to your previous article on my letter. While most were truly supportive others were coming from a place of judgment and condescension. I’d like to thank everyone who wished me well, and for them to know that their words meant a lot to me. That people took time out of their day to read about me and wish me well was uplifting. I send them all virtual hugs and hope each and everyone is happy and healthy.
However, I’d also like to address some of the comments that were less encouraging. Several people insisted that my letter was obviously fake because of how well I wrote, and that someone with my education level could not possibly be in the financial situation I’m in. I was less hurt by this attitude as I was utterly astounded by it. That people genuinely believe the educated cannot struggle financially just floored me.
“‘There are more ‘poor’ Americans than there are ‘rich’ Americans, and we are not stupid or lazy. We’re trying to make it work.’”
Poor people are not stupid. We’re not illiterate country bumpkins struggling to figure out how to work a computer. We’re the nurse that lives down the street with two roommates to be able to afford rent. We’re the teachers still living with their parents because they can’t find enough roommates to qualify for an apartment. We’re the cops working at Home Depot on the side trying to save up for a baby. We’re the lawyers doing Uber just to afford student-loan payments. There are more “poor” Americans than there are “rich” Americans, and we are not stupid or lazy. We’re trying to make it work — usually by having 2-3 jobs.
There is a financial crisis in this country. I believe it comes from unchecked capitalism. When corporations are allowed to buy up single-dwelling homes and drastically raise rents, and banks/lending institutions are allowed to prey on people with obscenely high interest rates, you foster an environment of exploitation. Our society allows for the targeting of young people before they even graduate high school. Credit-card companies and college-loan institutions begin preying on people as soon as they hit 18. If their parents are financially illiterate, and considering most public schools rarely teach financial literacy, too many young people start out life with insane amounts of debt. Additionally, wages have not kept pace with the cost of living in this country, and you have a lot of educated “poor” people.
I just could not believe those comments that insisted this story was fake because I was too educated to be poor. Then I was mad. Mad because that stereotype is what prevents a lot of change from taking place. Nothing is ever going to get better if we keep thinking the worst of each other.
Anyway, I again want to thank you for thinking of me and sharing my story. Hopefully it helped more people. As I said before, investing is truly empowering. I didn’t know that before, but I know it now, and I wish it for many more Americans.
Sincerely,
Not Quite As Low Income, But I’m Still A Couponing Lady
Dear Not Quite As Low Income,
Thank you for your insightful and eloquent letter. Your words and story continue to inspire me, and I hope will inspire many others out there in America who never had a head start in life and/or continue to face financial struggles. I wish you the best of everything in your life, and I hope more good things continue to happen to you.
You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on Twitter.
Check out the Moneyist private Facebook group, where we look for answers to life’s thorniest money issues. Readers write to me with all sorts of dilemmas.
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