Proof You Can Royally Mess Up With Money And Still Retire Early

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As you might’ve guessed, I often scour the internet to read what’s hot in the personal finance space. You could say it’s a little obsession of mine. What always seems to amaze me is how many young people are getting it right when it comes to their money. Don’t get me wrong, I think it’s wonderful that the FIRE/FIOR movement is so powerful that it’s starting to infiltrate the mainstream media and affect so many people. What I can’t seem to stop thinking about is how much further ahead I would be, financially speaking, had I found this community long ago. 

Although I still consider myself relatively young, if I had this information in my 20s, I’d be crafting this blog post from a beach in the Caribbean, or from the comfort of my GMC conversion van, or, well, anywhere in the world!

Unfortunately, I didn’t find the FIRE/FIOR community until I was in my 30s. But, hey, better late than never. I constantly remind myself that it’s not a competition, but it’s still difficult to not compare myself to my peers. After all, it’s basic human nature.

Financial Woes In Our 20s (and 30s)

Image may contain: 2 people, people smiling, people sitting, drink and indoor - mess up with money

Us – not in our 20s anymore. #stillcool 🙂

Since Mr. MMM and I didn’t meet when we were in our 20s, we had plenty of time on our own to royally mess up with money! That was both good and bad.

Good because we were young when we were making big financial mistakes, and bad because instead of making money missteps, we could’ve been focused on eliminating student loan debt and building wealth for the future.

Not surprisingly, we made all of the standard money moves that most normal people make in their adult lives.

When we finally met and joined forces, we had a bunch of financial failures and successes under our belts. But you know what, we still made bad money moves! We were going out to eat a few nights a week, spending money on cars, and still carrying student loans. Blah.

On top of that, just before we had our amazingly awesome (and frugal) wedding in an underground cavern, we went under contract to buy a house we couldn’t really afford. At least not comfortably. Fortunately, we were able to walk away due to a poor home inspection report and reboot our lives just before the wedding.

Right around that same time, we committed to living a frugal lifestyle and making the state of our finances a major priority in our lives. What we wanted most of all were options. And we realized that money gives you options.

If only we had realized this a little bit sooner, we could’ve avoided some of the stupid things we did with our money. Oh well, you live and you learn.

So without further delay, go ahead and feast your eyes on some of the ways Mr. MMM and I have messed up with money and, subsequently, the steps we took to fix our finances!

Some Of The Ways We Messed Up With Money

  • No Emergency Fund: Having an emergency fund wasn’t always part of our financial plan. We lived on the edge – and it sucked.
  • Credit Card Debt: We both had massive CC debt at one point.
  • Student Loan Debt: We both carried student loan debt for way too long. Our balances weren’t out of control, but we didn’t make paying them off a priority.
  • 401K Loan: Yes, I took a 401k loan in the past. #eyeroll
  • Car Payments: We both had ’em.
  • Buying A Rental Property: I overpaid for a rental property at the height of the bubble in 2007.
  • Eating Out: We used to think nothing about dropping upwards of $100 a few times a week in restaurants.
  • Spending Foolishly On Entertainment: Spending money on movies, meals, and trips were our normal.
  • Frequent Clothes Shopping: There was a time when I bought a new outfit every week. Every. Week.

Steps We Took To Fix Our Missteps

  • We Stopped Digging: We stopped using credit cards and financing stuff, including cars.
  • Sticking To A Budget: Tracking our expenses and sticking to a budget helped us take control.
  • Eliminating Debt: We eliminated all of our debt, except for the mortgage. We’re working on it.
  • Refinancing Our Home To A 15-Year Mortgage: After our home renovation (using cash), we refinanced to a 15-year mortgage at 2.7% interest. Oh, yeah.
  • Adopting A Frugal Mindset: Frugality has allowed us to determine what we truly value and what makes us happy. Hint: It’s not money.
  • Spending Only On Things We Value: We only spend money on things we deem important to us.
  • Investing, Investing, And Investing Some More: All extra money now goes toward our mortgage debt and into low-fee index funds.
  • We Started Tracking Our Net Worth: Tracking our net worth is super easy and it’s been our single biggest motivator for building wealth. If you’re not already tracking yours, I highly recommend you start.
watching tv, cat - mess up with money

Mad Money Cat wants the option to groom himself while watching TV. #FIRE/FIOR

So, if you’re buried in a series of financial missteps and you feel like there’s no way out, Stop, Breathe, and Take Inventory. There is always a way out. Like my mom always said, where there is a will, there is a way. That adage has helped me many times throughout my life.

It might not be easy. And it might not happen overnight. But, with determination and time, you, too, can fix your past money mistakes.

We’re living proof that you can royally mess up with money and still retire early, really early.

Other articles you might enjoy:

Our FIRE/FIOR Journey

These days, we’re firmly planted on the path to FIOR – Financial Independence Optional Retirement. We actually realized that, although we love the idea of FIRE, we’re not exactly chasing an early retirement – we just want it as an option.

Did you mess up with money but have since turned it around? If so, tell us about it in the comments!

Early Retirement | FIRE | FIOR | Financial Independence Retire Early | Financial Independence Optional Retirement | Financial Freedom via @MadMoneyMonster

22 comments… add one
  • Peerless Money Mentor Feb 14, 2018, 6:19 pm

    Great post, Mad Money Monster. I enjoyed hearing your story on the Firedrill podcast!

    • Mad Money Monster Feb 14, 2018, 8:36 pm

      Thanks so much!

  • Laura Feb 4, 2018, 3:35 pm

    I went back to school at the age of 39 to finish my bachelor’s degree and get my master’s in library science so I could become a librarian. I just paid off my student loans this week!

    My husband and I are now in our early 50s and we have only 2 low balance credit cards and our mortgage is down to $58k. We are on track now building up our retirement savings as quickly as we can.

    • Mad Money Monster Feb 5, 2018, 10:26 am

      That is an amazing success story. Nice work!

  • Steph Feb 1, 2018, 8:46 am

    Great post! I racked up so much student loan debt by being dumb with money in college. Once they were paid off, I turned around and bought a brand new car on a loan. Ugh! I always assumed people just had debt, that is a norm. So glad I found this community to tell me otherwise!

    • Mad Money Monster Feb 1, 2018, 2:52 pm

      We do have a pretty awesome community here! It still amazes me at how much debt people take on throughout their lives just because that’s what everyone else does. Craziness.

  • MarLeigh Jan 29, 2018, 7:56 pm

    Ugh yes. We figured since we could afford it, what was the big deal? Upgraded houses, bought new cars whenever we wanted, ate out constantly. I always did believe in savings and had healthy savings. But when the shoe dropped (the recession) it wasn’t enough to keep us from losing everything. After a few really tough years, we became laser focused. Paid off all debts, stopped eating out, keeping our cars till they crawl off somewhere to die. Now, although nowhere near where we need to be retirement-wise, we are debt free, live in a very affordable house in a low cost of living area and working towards being mortgage free in 5 years and working on our terms. It was a hard learned lesson but at least we can move on.

    • Mad Money Monster Jan 29, 2018, 8:09 pm

      Sounds like you had a definite light bulb moment around 2008 and you’re totally on the right track now. Two thumbs way up!

      Your bit about your cars crawling off to die made me laugh out loud, btw. 🙂

  • Javier Jan 26, 2018, 10:22 am

    Just listened ChooseFI episode 51. Inspiring. Seems we all made the same dumb mistakes early on. We all want to get to FI for different reasons. We get on the correct path and enventually we can get to FIRE, FIOR or whatever FI we want. 😎🏝🏖🛳

    • Mad Money Monster Jan 26, 2018, 10:40 am

      Thanks! I had a lot of fun talking with Brad and Jonathan. Reaching FI will be a wonderful day! Thanks for commenting. 🙂

  • Jason Jan 25, 2018, 7:30 pm

    I also screwed up early in life and it took until my late 30s to right the ship. I wish it was much earlier. If it had been I would also be in a position to be on a beach….maybe not right now, but within 5 years. C’est la vie.

    • Mad Money Monster Jan 25, 2018, 8:17 pm

      I’m glad we messed up. If we hadn’t, our story wouldn’t be nearly as interesting. 🙂

  • Mark Jan 25, 2018, 6:29 pm

    You must have hit that 2.7% rate the 1 week it dipped that low. Congrats. We got in at 2.875% on a 15 year but on target to payoff on a 5 year terms. Thanks for showing off your mistakes so that others may learn. I managed to screw things up between 35-45 but back on track for at least a “earlier than normal” retirement before 60. It’s tough sometime not to think about “what if..” but you have to just keep looking forward. I went from heavy debt, lost job, lost house, lost wife at 46 to a healthy net worth, no credit card debt and mortgage paid off soon now at 52. Followed the steps you laid out as well. So it’s never too late to turn your financial life around.

    • Mad Money Monster Jan 25, 2018, 8:16 pm

      Wow, you really experienced a lot of life’s ups and down. I’m glad to hear you’re currently UP with all of your hard work and persistence!

  • Mrs. Groovy Jan 25, 2018, 3:34 pm

    Way to go on the 15 year mortgage! You rock! And we loved hearing your story on ChooseFI. You’re living proof that one conversation with someone you don’t even know all that well can turn your life around.

    We never even HEARD of an emergency fund until we were in our 40s. For a long time we were 1-step away from a disaster. Getting out of NY helped but getting the right mindset was even more helpful.

    • Mad Money Monster Jan 25, 2018, 8:13 pm

      Thanks! And I LOVED your episode on Choose FI, too! I think we were back-to-back.

      Yeah, we love out 15-yr, low-interest mortgage, but we’ll love it more when we pay it off. Hopefully in the next year or so. 🙂

  • Kat Jan 25, 2018, 7:52 am

    Ugh, we also bought a home near the height of the market in 2006. We converted it to a rental home when we moved in part because the market value had decreased. 🙁 But, as we hung onto it, the rents increased and finally so did the market value. So, we are finally happy to have it as part of our overall investments (although TBH it’s a weird looking mid-century modern that’s kind of a pain to manage, ha ha). Did you keep your rental? If so, I hope it became a winner too! 🙂

    • Mad Money Monster Jan 25, 2018, 9:35 am

      I did keep my rental! It turned around as well and I’m no longer under water. Phew.

      On a side note, I absolutely LOVE mid-century modern architecture. It’s my favorite. But, I know I’m in the minority…unless you’re living in sunny Cal.

      • CashflowKat Jan 26, 2018, 1:08 pm

        Yay for your rental! It’s the best once it finally turns that corner and is throwing off some money!
        And I also like mid-century generally BUT you should see this house! I think the architect was on something! The main front view is of the freaky carport that slants upwards topped by a fake set of windows – hard to describe adequately – but not pretty, hee hee

        • Mad Money Monster Jan 26, 2018, 1:47 pm

          Haha! I love the description of your rental. 🙂

  • Drew @ Jan 25, 2018, 7:23 am

    Oh yeah…too much online poker, a purchase of sports collectibles to try to sell on eBay, and penny stock trading. A lot of that comes down to immaturity. Some of it I look back on as desperate attempts to escape the 9-5 because I was so uncomfortable with my introversion. Time, maturity, learning, and self reflection started my way out of the hole.

    • Mad Money Monster Jan 25, 2018, 7:27 am

      Thanks for sharing! Yeah, it’s funny to look back on the ridiculous money moves we made in our 20s. Perspective truly is everything.

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