How a 'fabulously broke' couple with $51,000 in debt ended up with $1 million in savings |
In 2005, John Schneider and David Auten had grown accustomed to a lifestyle replete with designer clothes, gourmet meals, weekend brunches and expensive vacations. It was all part of an attempt to live a “fabulously gay” lifestyle — one they now admit made them “fabulously broke.” In an effort to impress the people in their life, the couple — both of whom worked in the financial services industry — landed themselves $51,000 in credit card debt.
So they put their financial know-how to use. They used a 0% balance transfer credit card to eliminate interest payments and stopped using credit altogether. They set strict spending limits for gas, groceries and entertainment, and they put every bill and expense they could on autopay.
Nearly everything they saved they funneled toward paying down their credit card debt. Even with neither of them earning a six-figure salary, it took them less than three years.
Once their debt was paid off, the Auten-Schneiders focused on accumulation. Using the same strategy they used for debt payoff, they built their emergency fund, saved for a down payment on a home and aggressively contributed to retirement accounts.
The pair’s retirement portfolio currently exceeds $1 million.
In 2015, sensing a need for LGBTQ+ focused financial advice, they started Debt Free Guys, where they share their personal and professional experience with money management. Since 2018, both Auten and Schneider have worked full-time on the site, and Debt Free Guys has generated close to half a million dollars in revenue, they say.
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Money Tip of the Week: How to balance student loan payments and retirement saving
Virtually everyone is managing competing financial priorities, and for millions of Americans one of those priorities is about to jump the proverbial line. Federal student loans are set to resume accruing interest on Sept. 1, with payments coming due in October.
If your student debt payments are about to come back online, here are five steps experts suggest taking to balance debt payoff with your other financial goals.
1. Get your bearings. Start by establishing a budget and outlining financial goals. Take a few months to assess your income, your expenses and your spending priorities. Think about where you want to be financially in one, five and 10 years.
2. Always make the minimum payment. This way, you’ll avoid late charges and keep your debt from growing.
3. Build yourself a buffer. Financial experts recommend stashing enough away to cover three to six months’ worth of living expenses, but that may not be realistic right away. To start, try putting away enough to cover two months’ worth of student debt and a couple months’ rent. 4. Start investing. The earlier you start investing for retirement, the longer compounding interest has to work its magic on your savings. Consider contributing to a workplace retirement account, such as a 401(k) – especially if your employer matches up to a certain percentage of your contribution. 5. Continue learning. Growing more financially literate will help you navigate money challenges while saving for short- and long-term goals. |
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Next Gen Investing: How a self-made millionaire would use A.I. to generate passive income |
Matt Higgins doesn’t need to hustle anymore. The co-founder of a private equity firm, Higgins has bought and sold business interests for hundreds of millions of dollars, been an investor on “Shark Tank” and served as an executive for two NFL teams. But at heart, he’s still the kid from Queens who dropped out of high school at 16 and wonders what he’d do if he went broke and had to start over.
“Luckily, thanks to AI, there’s never been a more exciting time to make money,” he wrote in a recent piece for CNBC Make It. Here’s what he says he’d do if he had just $100 in his pocket.
1. Identify a fast-moving trend. Look for a niche that is compelling enough that many people will pay you to learn hacks. As an example, Higgins suggests “AI for small business and startups.”
2. Become an expert in 24 hours. Take a day to scour the internet to learn about the latest time- and money-saving AI tools for core business functions. Distill everything you learn into a comprehensive document or recording without plagiarizing. Upload that document or unedited video to an online course creator such as Courseau.
3. Build a logo and website for your course. Come up with a clear, actionable title for your course, such as “How to Use AI to Save Your Small Business Time and Money.” Consider programs such as Looka and Midjourney to build a logo. Use Durable to create a website where your course will live.
4. Use AI as your marketing and sales team. Outsource your marketing strategy to ChatGPT. “You can use the platform to create a newsletter, draft viral tweets and churn out irresistible emails — all without having to write a word of it,” Higgins writes. |
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