Money Journal: 1 Week On $62K In St. Paul’s Merriam Park Neighborhood

How far do the dollars of a 39-year-old comms specialist/line cook/freelance copywriter go?

8:54 AM CST on January 16, 2023

Welcome to Racket’s Money Journal series, where you can snoop on the finances of an anonymous Twin Cities neighbor. Interested in submitting your own? Email jay@racketmn.com for instructions on over-sharing the monetary details of your life! H/T to Refinery29 for pioneering a tremendous concept that we’re excited to localize.

Personal Info

Jobs: Communications specialist (full-time), line cook (part-time), and freelance copywriter (part-part-time)
Age: 39
Neighborhood: Merriam Park, St. Paul
Education: B.A. in communication, M.A. in journalism
Salary: $62K total; $48K from day job, $11K part-time job, $3,500 misc. freelance
Partner’s salary: N/A—single, never married
Dependents: None
Estimated net worth: -$138,000. Yes, you read that right, that’s $138K net in the hole if you count student loans. Basically zero otherwise. But believe it or not, my financial situation is far better than it was a few years ago; more on why later.

Debt

Student loans: $115K

Personal loans: $3K

Credit cards: $7K

Court fees & fines: $200 (remaining fines due from 2016 DUI conviction)

Back taxes: $1,200 (remaining from 2017 federal tax underpayment, a year when I failed to save money for taxes out of freelance income)

Medical debt in collections: $12,000

Credit score: 670

Assets

Checking: $281.00

Savings: $0.02

Retirement account: $800

HSA: $240

FSA: $300

Monthly Income

Gross income: $5,000 (rough average)

Net paycheck(s): $3,350

Monthly Expenses

Rent: $780 (small studio in old building)

Utilities:

Electric: $35
Gas: $15
Water/sewer: $0 (included)
Trash: $0 (included)
Internet: $65

Insurance, per two two-week pay period:

Health: $44
Dental: $6
HSA: $100
FSA: $10
Short-term disability: $6
Long-term disability: $5
Life: $0 (included benefit 1.25x salary)
Auto: $0 (N/A–no car for time being)

Savings:

$250 (deducted by MN State Retirement System)

Recurring:

LifeTime Fitness: $130
T-Mobile: $125 (includes iPhone insurance, Netflix, and financed phone)
Amazon Prime: $16
Apple Music/TV/iCloud Storage: $18
WeWork all access: $250
New York Times digital: $12
Racket: $10 [Editor’s note: Hell yeah]
Grad school’s alumni fund: $10
Personal loan payments: $215 (about two years to go at this rate)
Credit card payments: Varies greatly month-to-month, in part because I run as many of my livings expenses as possible through Delta’s platinum card for the miles benefit.
Squarespace: $40 (two domains and two sites hosted)
Metro Transit: $60
Lyft: $300 (also varies greatly)
Student loans (TBD whenever government decides to start collecting again)

Money Talk Q&A

Did your family talk about money growing up?

Yes, sort of. Both of my folks grew up in big families with tight budgets, so their outlook on finances was—and still is to some extent—conservative, with a bit of a scarcity mindset, even though they became successful and were upper-middle class for many of my formative years. For example, me and my siblings were allowed to have one can of soda a month. Drinking anything but water or milk was a sort of privilege—not so much because my parents couldn’t afford sweet drinks; they wanted to impart the concept of needs versus wants on us. They encouraged me to get a job as soon as I turned 15, save, invest, and always live below my means. I got a job bagging groceries almost as soon as I legally could, and I loved picking up MY check and filling out a deposit slip at the bank to deposit MY money. But later through impulsiveness and immaturity I drove my own finances into the ground in my 20s—more on that in a bit.

I would add that although my folks did talk about money, it was always framed in terms of what could/should do. My dad shared what he did with money in only very abstract terms, but never once shared with me his salary or any specifics about his finances. I had (and have) a vague idea of their income and overall financial situation, but to this day have no idea what their estate is actually worth. There are some strange family dynamics, generational trauma, and other assorted emotional baggage that fuel this tight-lipped bent on money, but I’ll save it for my memoir.

Did you worry about money growing up?

No. I was very fortunate to have high-functioning married professional type parents who were good with money, so there was never an unpaid bill, skipped meal, or unmet basic need. I had access to good medical and dental care, including preventive and orthodontic care. I attended private school from grade K-8. My parents gave me $1 per week allowance until I was about 10. At that point I got a pay bump—I think to $7 per week, but had to put $2 of that in a “long-term” savings envelope and $3 in a “short-term” savings envelope, leaving $2 “walkin’ around money.” If I wanted that latest Super Soaker or a remote-controlled car, I had to dip into Short Term Savings, and Dad would not stand in the way, but would try to guilt-trip the shit out of me for buying a stupid thing that I’d only play with for about two days before getting tired of it. And he was always right. He was a tightwad about buying us stuff directly, but once in a while I’d luck out and he’d spring for a kite or a pack of rocket engines for my Estes hobby rocket.

Kids from working-class and middle-middle-class type families probably perceived me as “rich,” and kids who had both parents in high-income jobs and who got to go on “airplane trips” to Hawaii every winter probably looked at my Payless velcro shoes and my Mom’s brown Ford Aerostar van and assumed I was very “basic.” We were objectively upper-middle class, and it wouldn’t be until I became financially independent after college that I truly appreciated what that meant. Hailing from a big family and having thrifty parents meant some contradictions and funny quirks like that, sometimes.

At what age did you become financially independent?

Twenty-two, when I finished college and started working, if you don’t count that I remained on a parental healthcare plan until about 23, when I started my first job that offered insurance. At that time, in 2007, my salary was $28K. My rent was $330 (this was a very small town).

How did you learn how to budget your life?

Learning how to do something and actually doing it were two different things for me. I knew what a basic household budget was and how to balance a checkbook in high school, especially after taking a personal finance class as a senior.

I was pretty good with money until my third year in college, when I started drinking and immediately found myself in the grips of a serious drinking problem—though I didn’t have any insight about it at the time. My journey into the depths of alcoholic insanity took me into six-figure debt, if you count my student loans (some of which I used to support the habit, before I started to get meaningful help.)

I still don’t really stick to a budget, but for the past few years I’ve never missed a payment or paid anything late. So my credit score is creeping slowly up as my overall revolving balances decrease, and that has allowed me to have access to more mainstream living, such as recently getting an apartment and having an ID that matches where I actually live. I’m probably not as motivated as others my age to obsess about “building wealth,” partly because I grew up with it and I saw how little it made anyone happy—more like the opposite, in fact—and partly because I don’t ever want my own biological kids. I also don’t particularly care about home ownership. When I’m a little box of ashes on someone’s shelf in 20-30 years, or however long I get, I’ll definitely not look out from my little silk pouch and wish I had spent this time obsessing over accumulating material things.

Have you ever received inherited income, major financial gifts, or large insurance payouts?

I was about to say “nah…” But then I thought back on my situation and do remember some “major” gifts that gave me a leg up.

Upon finishing undergrad/college my parents gave me a down payment of $5,000 for a car, and a grandparent gave me a check for $3,000 to do with as I pleased. Had I invested that in Apple in 2006, I’d have what, like $500,000 now? Maybe more? But no, I spent it.

The next time I received a major gift was for graduate school. A grandparent gave me $7,000 then—which I guess you could call a sort of early inheritance. I was in New York City, so it was enough to cover just some of my living expenses. When I finished grad school I received $500 from that same grandparent, and several years after that, shortly before they died, they left me another $2,000 meant to support my writing career in some way. I used half for a new computer, which I desperately needed at the time and probably blew the other half in a bout of relapse.

Do you worry about money now?

No. The upshot of having been through my years of personal struggles is that I don’t live in fear of not having “enough” money. If I have basic food and shelter, I have enough. Anything above and beyond that is cause for gratitude and joy. Before I got my current job a few months ago I spent six months living at a homeless shelter in Minneapolis, and though it was uncomfortable at times, it was safe, warm, and provided just what I needed to save some money from a restaurant job and find an apartment.

As you’ll see from my monthly expenses, I live well. I fly places. I indulge in the comfort of working my job’s “offsite” days at a nice co-working space. I buy fresh produce, decent coffee, and (too much) chocolate. AND I’m paying down debt. AND saving. I do all of this by choosing an older, cheaper, smaller apartment rather than maxing out my budget on housing, and I choose not to own a car—at least not until I’m earning at least 20K more a year, because a single person with no kids doesn’t *need* a car in the Twin Cities close-in metro area. I also work part-time on the weekends in addition to my day job. My weekend job is at a restaurant and provides a fun social outlet, some time on my feet, and an opportunity to keep my cooking skills sharp in case there is ever time between creative professional jobs when need to support myself with restaurant work. As any creative writer or artist will tell you, *always* curate a reliable side hustle. It takes a lot of the stress out of living and helps one avoid saying “yes” to jobs that aren’t a good fit.

But it took me many years and lots of falls flat on my ass in more ways than I can count before I learned I can feel completely secure regardless of my income. I just have to adjust my lifestyle to fit my financial reality at any given time. It’s incredibly freeing to know that the vast majority of people you encounter care very little about how much or how little you have materially—other than maybe reading these very addictive "how I live on X amount of money in Y neighborhood" articles ;-) People care much more about how you show up for yourself and others in the real world.

How much do you think a person or household needs to earn to live comfortably in the Twin Cities?

To answer that, let’s come up with a working definition of “comfortably.” So many of us have lived paycheck-to-paycheck for so long, we can’t even imagine having the cushion that truly middle- and upper-middle class people have. Mine would be this: I am “comfortable” if I live in a well-made building or house with indoor/off-street parking. All my healthcare, dental, vision, and hygiene needs are met without incurring any debt. I am able to travel domestically at least a few times a year and internationally at least once every two years. My home is decently furnished, and my vehicle is fewer than 10 years old and maintained in good condition. I’m able to give modest gifts to family and friends for their birthdays and other significant events. I’m able to subscribe to all the media I want, and I’m able to give charitably to a few organizations whose cause I care about. I eat out sometimes and cook at home sometimes. I’m able to afford clothes that fit and replace them before they’re too worn to donate. And after all that I am able to save at least 10 percent pre-tax toward retirement. That lifestyle, I believe, without cutting any corners, would be about $150K for a single adult (basically what a specialized nurse or a physician assistant earn) and $225K for a couple. This figure is Minneapolis/Saint Paul proper. Maybe subtract $25K for the outer suburbs, St. Cloud, Duluth, and Rochester, and subtract 50K for rural and small MN towns.