This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

J.D. Roth: Master the Mental Game of Money

HUNT VALLEY, Md. ( TheStreet) -- In this special guest series of guest posts from four noted authors and bloggers on money and life, you're in for yet another treat.

J.D. Roth is an accidental personal finance expert. For more than five years he's been writing about smart money management at Get Rich Slowly. He's too humble to tell you himself, but his blog was chosen by Time as one of "The Best Blogs of 2011."

The author of Your Money: The Missing Manual admits to starting out with plenty of money troubles of his own.

He's the author of Your Money: The Missing Manual (O'Reilly Media, 2010), a personal finance columnist for Entrepreneur and a regular contributor to Time's Moneyland blog. Really, though, he just wants to write about travel -- but he's been kind enough to give us a synopsis anyway of the most potent lessons he's learned as a personal finance blogger.

J.D. Roth writes: Last weekend, I attended my 20-year college reunion. In 1991, I graduated from Willamette University with a degree in psychology (and a minor in writing). I also graduated with debt. Not student loans -- I was fortunate enough to have earned scholarships to pay my tuition -- but something far worse: credit card debt. Yes, it's true. I was one of those college students suckered into a life of debt by credit card offers in the student center. By the time I graduated from college, I had three credit cards and was desperate for a job to make my payments on them.

And so it began. For the next five years, I accumulated more and more credit card debt, topping out at more than $20,000 before I got fed up and cut up my cards. Even that wasn't enough to stop me from spending, though. I borrowed from family and friends. I took out personal loans. By 2004, I'd acquired more than $35,000 in consumer debt. It wouldn't have seemed so bad if I'd used this $35,000 to pay for medical bills or to start a business. But I didn't. I used the money to buy computers and comic books and other crazy stuff.

Getting smart about money
My story isn't unique, and I know that. Lots of people make dumb mistakes. But when you're living the dumb mistake, you feel all alone. You feel helpless. When you're in debt, it feels like you're drowning, like you'll never make it to shore. Here we are in 2011, though, and things have changed. Seven years ago, I had more than $35,000 in debt and was falling further behind every year. Today I have more than $35,000 in savings -- and I pull further ahead every year.

How'd I do it? Well, I didn't win the lottery, and I didn't rob a bank. Instead, I spent several years making small, subtle changes. I learned how to live a frugal lifestyle, cutting back on the things I didn't really need (like cable television). I discovered the debt snowball, a sort of mind game that allows people like me to finally pay off their debt instead of just wishing they had. I started to save for emergencies, for retirement and for fun. I worked long hours to bring in extra income. All of this was hard work, but it paid off. In December 2007, I became debt free and I've remained so ever since.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $124.75 0.00%
FB $80.78 0.00%
GOOG $524.05 0.00%
TSLA $206.79 0.00%
YHOO $44.45 0.00%

Markets

DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs