Today's episode features Gina from The Frugal Convert.
Gina has a powerful story of being alone and broke at age 19 with a child to take care of.
She didn't let her circumstances define her and took control of her life.
Then over time, things began to slip again and she realized she needed to change at a more conscious level.
Now she's a full-fledged frugal convert and closing in on financial independence.
Listen, learn, and let us know what you think about Gina's wild ride.
Episode Summary
Gina's "Jar of Pickles" Moment
Gina found herself 19, newly married, and pregnant and totally broke.
Her then-husband took her phone, car, credit cards...everything
She was hungry and alone in her home and had nothing to eat but pickles
Then she found herself on the floor crying
Gina then started going through all the bad decisions she'd made in her life that led to this
But then she decided she could take control
She divorced him and life moved on
Now she's married to the man of her dreams
Gina takes steps back again
Things were going well for a while after her wake-up moment
Then Gina got comfortable and started racking up credit card debt
She and her husband were happy and well employed but her habits hadn't changed
Then they found themselves in over $100k in debt
Earlier in life, she had racked up debt
She had done this because her rent was $1150, she was going to college, had a kid, and only earned $1200 per month
Gina would get a loan to consolidate her debt but then keep racking up more with the new limit
Making Habits Stick
Gina realized that she would have to really change her habits to turn her life around
Her first step was to start really tracking her spending
It wasn't cold turkey, she just lowered the frequency of disposable spending
Eating out once a week instead of three times a week, etc
She admits she tried to make a budget before she tracked her spending
That is generally a big mistake and leads to failure
Without a point in time, it is hard to make reasonable projections
She also says that a budget should be a living document
It can't be something you set and never adjust
Gina utilizes an excel spreadsheet and breaks it into four categories
The first is survival - food, utilities, rent
The second is debt
The third is extras - Netflix, eating out, etc
The fourth is fun money - even if you still have some debt to pay off
Redefining Frugality
It's not about deprivation, it's about reprioritization
It is fun and rewarding to be frugal
You become picky about what you spend your money on and only focus it on things you're excited about
She also began to realize that she was actually just buying things because it was a habit
It wasn't that she needed them or even wanted them long term
Now she's much more into decluttering and keeping things simple
Finally, Gina walks us through how this is all possible in Los Angeles
She also shares budgeting with her kids
They don't feel deprived, they are just getting educated and comfortable with money
Leaving A Legacy
She really wants to follow her passions full time and step away from traditional work
Gina also wants to get more into real estate and having extra streams of income
In 2007 they had bought a condo, then the 2009 crash happened
Her husband lost his job because it was tied to the mortgage industry
She was furloughed due to the turndown
So her focus will be on diversifying their income streams
Her real passion is going out and being hands-on with moms in the welfare
She wants to develop programs they can use to take control of their finances
Key Takeaways
When Life Hands you Lemons: Gina had every right to be down on life and never crawl out of her low spots, but she always learned and improved herself.
Behind Every Paycheck is a Passion: Gina acknowledges that her day to day job isn't her passion, but she has a plan to make that passion come to life
Call to Action
We often talk about what we NEED to retire, as an exercise, calculate out what your Survival portion of your budget is (Rent, food, utilities, etc). It will help you identify your trade space when working towards financial independence
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Gina's Information
Gina's Website: The Frugal Convert
Instagram: @TheFrugalConvert
Twitter: @FrugalConvert
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