Money in the Media #21

Patriots’ Joejuan Williams lives off 10% of his income and says a high school finance class taught him how to save

This is the last Money in the Media for the year and I wanted to end the year with a great example of how to go against the grain and do what’s best for you. This week’s article is from CNBC and is called “Patriots’ Joejuan Williams lives off 10% of his income and says a high school finance class taught him how to save.”

Education is the Key

Now, it’s easy to live off of 10% when you sign a 4 year contract for $6.6 million, but hear me out. Most of the folks making that much money live on the majority of it. Buying new homes, cars, clothes and toys. Joejuan decided to do something different and it’s all because of a finance class he took in high school.

He first learned about the importance of investing and saving from a personal finance class he took in high school. In that class, the rookie says he learned about mutual funds, hedge funds, 401(k) plans, certificates of deposit and Roth IRAs. Those financial lessons, he says, influenced his decision to invest roughly 90% of his income from NFL checks, leaving him to live off the remaining 10%.

The majority of what I do as a financial coach is to educate my clients. In doing so, I see more than anything that a finance class in high school is one of the most necessary courses that most schools still do not have. Have you ever seen this meme?

Credit: Someecards

It’s funny, but also true. The basics of how to be financially responsible just aren’t being made a part of public education in most schools. However, Joejuan William’s school did and now it has positively impacted not only his life, but his mother’s, his children’s and each of the families of the other students in his high school class.

Nothing Lasts Forever

Joejuan very consciously puts his money in investments, after he paid off his mom’s student loans for her and bought her a car. Being in the NFL is a great career path for those with the talent and bit of luck to get there, but it could all be over in an instant. One injury or swipe of a coach’s pen and they could be cut.

I still hold myself to strict guidelines in terms of what I touch in terms of that money. It’s guaranteed football is going to be over one day. I tell kids that all the time.

Brandon Copeland, NY Jets Linebacker

Even for the rest of us who are not football stars, the concept remains the same. For example, we are currently a double income no kids (DINKS) household, but my wife is planning on quitting her job once we start building up our family so then we will be a one income family. So, to prepare for that eventuality, we live on less than just my income to eliminate the stress of becoming a single income family.

This change in our finances is something that we can plan for, but there are other changes that are not so easily foreseen. A layoff or injury of my own could completely change the landscape of our financial future. This is why I have disability insurance and invest heavily while we are both young so that we can rest easy when we are older and not as able to handle financial stresses.

The Lesson? SAVE

Saving is key to the health of your financial life, which will influence the rest of your life. So, even if it seems impossible to save now based on your income or circumstance do what you can to stash away even $5/month. Then work to grow your income just a bit and increase that to $10/month and so on. It may not sound like much money, but it’s more money than you have now. What you want is to start a ripple effect that will increase your savings over time until you are financially secure.

Another way to think of it is to imagine just how much money could truly change your life. Is it $1,000,000? Or would something like $10,000, $5,000 or even just $1,000 help you make significant changes? What would it take for you to amass this life changing sum of money? Divide that number by 12 and try to make that your monthly savings goal for 2020. If your number is $1,000, then $83/month is certainly a reasonable goal.

You may say that if it will take you a year or two or five then what’s the point of even trying? To that I say…

Never give up on a dream because of the time it will take to accomplish it. The time will pass anyway.

Earl Nightingale

What is a life change amount of money to you? Are you working towards that amount as a savings or retirement goal? Let me know in the comments below!

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