When Tyler left, Melinda cried.
She cried because he was a kind, thoughtful young man who reminded her of her own sons, whom she had also seen leave the nest. In the month or two he’d lived with us, he’d unconsciously worked his way into her heart.
I also got a little misty-eyed…without being asked Tyler had cut my grass, repaired my lawnmower, fixed various leaks, gates and household appliances and even pulled out his chain saw when a tornado made toothpicks out of some trees in our back yard.
Now all that was back on me. Tears.
We met Tyler through the Louisiana Tech chapter of the Fellowship of Christian Athletes. He’d put himself through school on a track scholarship, but his apartment lease ran out about a month before he was finished with school. We offered to board him for a month.
The day before he left for Florida and a pharmaceutical sales job, he came by my office.
“So, what do I do with my money?” he asked.
“Let’s make this simple,” I said. “10/10/80.”
“OK…now you want to tell me what that means?” he smiled.
“The first 10 is giving. I know that’s important to you, so give 10% right off the top.”
“The second 10 is saving. If you’ll save 10% of every check you get, you’ll end up with more money than anyone you know.”
“And the 80,” I continued, “is the rest. You can spend it any way you like. Just don’t go into debt. If you use a credit card, pay it off every month. The first month you fail to pay it off, cut it up and start using a debit card.”
He thought for a minute and said, “That sounds simple. So how long do I do this? Don’t I ever start putting money in a 401K or anything?”
“Sure,” I said. “You’re single and you’ll be making a pretty good living. Go ahead and sign up for your 401K up the amount that is matched by the company. But only if doing that does not take away from you saving 10% into a savings account. If you do the 401K, that’s extra.”
“So how long do I do that…save 10% into a savings account?”
“Forever,” I smiled. “Sort of…you’re going to want to save money for the rest of your working life. But what you do with that savings is going to change over time.”
“First, save the 10% until you have a savings account equal to six months of income. At 10% per year, you can do that in five years. If you get aggressive and save 20%, you can do it in about two and a half years. But get six months of your gross income in a savings account that you can access in the event of an emergency.”
“Then,” I didn’t wait for his next question, “I want you to keep saving your 10%, but now save it into another savings account you think of as your own personal bank. This is where you’ll pile up money to make big, major purchases that most people have to borrow money to buy – things like cars, vacations, furniture, appliances, down payment on a house…you’re going to treat this like a bank and when you need money to buy something big, you’re going to “borrow” it from yourself. This simply means once you “borrow” the money, you’ve going to pay it back with interest. Just get an online payment calculator and figure out how much your payment to a bank would be, and pay that back to yourself. The payment itself will regulate your current spending, and you’ll be replenishing the money you spent.”
“Wow,” he said, more to himself than to me. He was thinking. “I like that!”
“One last thing,” I said. “Remember, the biggest asset you’ve got isn’t your truck, or a big bank account, or even a six-figure career. The biggest asset you’ve got is you. So protect it, develop it, care for it and use it for good. Got it?”
He smiled back at me. “Yes sir, I get it. I will.”
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