I spent most of my early 20s living above my means, keeping up with the Joneses, and not saving. I had an academic and professional background in economics and finance. But I was always working full time, more than 40 hours a week, and I never took even 30 minutes to organize my money. Living paycheck to paycheck was something that I just thought would be the norm for me, until I decided that enough was enough.
My turning point came when a family member had a delicate medical emergency and I couldn't travel to see them because I didn't have any funds to pull from in a crisis. I didn't have any savings at all, and I felt so ashamed. But it was at that moment that I realized that the only way to change my financial life was to change my entire mindset about money.
In 2015, I started a side hustle: a digital marketing and e-commerce company called CP Clicks. Thanks in part to the revenue I earned from my business, in 18 months I was able to pay off $38,000 in credit card debt and build up an emergency fund that covered six months of fixed expenses.
From a young age I would often hear that saving that much money was almost impossible — that you could only save that much if you were already wealthy. So I approached this new milestone with some trepidation. But having learned the value of paying myself first through this process, with determination, patience, and consistency, I was able to save $100,000 and buy my home in less than two years.
Here are the strategies that helped me get there.
I think that the most challenging part about saving money is actually remembering to transfer the money from a checking to a savings account. By automating my savings, I didn't have to remember on my own. I had that specific transfer set up for me that was debited from my checking account to my high-yield savings account every two weeks. And automation has helped me continue to build wealth beyond saving for a house.
I also took advantage of the 401(k) and the match offered by my full time employer. My employer matched 100% of the first 5% I contributed. Oftentimes, if your employer pays you with direct deposit, you can request to split your check to multiple bank accounts, including your 401(k). If you don't qualify for 401k, consider opening a Roth IRA or traditional IRA.
I kept money for different goals in different accounts to help me stay organized, and named them to make the process more fun.
I had two checking accounts and two high-yield savings accounts for the emergency funds. One of the reasons why I decided to place my emergency fund in the high-yield savings accounts was because I could put in a safeguard — I made them online-only accounts without ATM access — that would make it tougher to pull from them for everyday purchases.
Having several bank accounts made automation even more efficient, because I had dedicated checking and savings accounts and specific transfers that were going to each of the designated accounts. And since it was easier for me to track my savings goals using online bank accounts and digital apps, it helped me stay motivated.
Video by Stephen Parkhurst
At this time, I was working in my full-time job and also had several clients as a freelance digital marketing specialist. In addition to that, I was a freelance translator, had an e-commerce store, and was an affiliate marketer. Having a side hustle is not easy while working full time, by any means, but it's so worth it —especially if you want to save, start investing, or pay off debt as soon as possible.
You can start a side gig by researching what's in demand right now, learning something new online and using that new skill to start a side hustle, or by analyzing your current skills and experience, and finding ways to monetize that existing hobby you have. I also negotiated my salary in my full-time job, which helped to increase my monthly income.
Three years into my side hustle, I was bringing in a total of $10,000 per month from both my day job and side businesses, which allowed me to save 60% of my income, almost $6,000 a month. In addition to that income, I also looked at the ways in which I could reduce any unnecessary expenses.
I cut cable, cooked mostly at home, and took my lunch to work most days. I found free or budget-friendly entertainment events, like going to parks and the beach, switched to cheaper cellphone plans, saved as much as possible on groceries by going to discounted markets, and canceled unused memberships. These strategies helped me save approximately an additional $2,800 per year.
Video by Stephen Parkhurst
Once I started saving, some days would be harder than others, and I sometimes found myself falling into a trap of comparing myself to friends or people on social media. But as my salary increased or when I found more freelance clients, I made sure that my lifestyle didn't change. I kept the same car, lived in the same apartment, and surrounded myself with like-minded people.
To stay disciplined and motivated, I always kept my "why" in mind: financial freedom, having options, and living life on my own terms. Saving the $100,000 to buy a house wasn't just a good investment. It meant that I had the patience and discipline to achieve my dream, and that I was taking positive steps toward my goal of building generational wealth. Remembering that helped me stay the course and made all those steps worth it.
Katia Chesnok is the founder of personal finance blog and Instagram platform Economikat, where she educates millennials, Latinx, and BIPOC communities on all things money and empowers them with wealth-building tips to earn more, negotiate, side hustle, budget, and invest. She paid off more than $38,000 of credit card debt in 18 months thanks to her side hustle, which later became CP Clicks, her six-figure digital marketing business.
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