From Broke Phi Broke to Financially Woke – Karen Cordaway
Today, I am excited to share with you the latest interview in the From Broke to Financially Woke series! The purpose of this series it to give hope to those struggling to escape from the not so secret group Broke Phi Broke. A group whose chant is, “We ain’t got it. Broke, Broke, Phi Broke! We ain’t got it. Broke, Broke, Phi Broke!”
To help me accomplish this goal, I have invited the best and brightest of the financial independence community here to share their stories. As you read their interviews, pay close attention to the mistakes they made. Take mental note of the success principles they used to turn things around.
When trying to apply these principles to your own life, realize that success in life is rarely linear. You will encounter some struggles. But stay persistent. Keep moving forward.
Our special guest today is Karen Cordaway, author of the Everyday Bucket List Book, which is a quick and powerful read (I highly recommend it!). At her lowest point, she left a job she hated without a plan in place.
As you can imagine, this was an incredibly stressful time for her. What did she do to turn things around? I’ll let her fill you in on the details…
Introduce yourself. Where do you blog? What are some of your interests outside of financial independence?
I love to travel (road trips, day trips,etc.) bike ride and attend concerts.
Tell us about a time where you were a member of Broke Phi Broke. How did living paycheck to paycheck make you feel as a person? At your lowest point, how much debt did you have?
I left a job I hated. I didn’t have a plan in place when I left. It was stressful and anxiety producing, for sure. I knew I had to change how I viewed the situation at the time to make it work.
I’ve been lucky enough to just have mortgage debt, but I stopped working full time because I didn’t like what I was doing. It wasn’t a supportive work environment. It wasn’t ideal to do what I did. My husband and I were both teachers at the time. When I left, we were on one teacher salary in a highly taxed state.
The job wasn’t manageable with a young family. I had to run both of my kids to two different schools and try to be on time every day. It wasn’t easy. One slight change in traffic would throw everything off. I knew that it was a complete leap of faith to leave and I truly didn’t know how I was going to make it work. Everyone will say you have to have another job lined up before you leave a job, etc. I felt like I got harsh, unsolicited advice which wasn’t what I needed at the time. It made me feel worse.
What are some of your biggest financial mistakes?
Though I try not to beat myself up, I wish I would have invested more money earlier, created an emergency fund and had a better understanding of how kids would impact your career and finances.
Describe your upbringing. Where did you grow up? What did your parents or teachers teach you about money?
I grew up in New Haven, CT (a diverse city where Yale is located.)
I don’t remember learning anything from teachers about money. I think I had one “career class” that seemed more like life skills. We learned how to write checks and use a checkbook, but outside of basic dos and don’ts at a job, that was all they covered regarding money.
My mom worked in accounting so making sure I paid bills on time was taught, having good credit, not racking up credit card debt and some other tips along the way re: how much to pay for a house and other things as they came up.
How important is becoming financially woke to you? What steps have you taken to increase your financial knowledge?
Becoming financially woke has been extremely important. It dictates your life’s trajectory. I think once people have enough knowledge, they can use their own judgement.
Though I would listen to advice here and there on TV, once I quit that job, I read any personal finance book I could get my hands on to figure out what to do. I learned how to live very frugally. I also learned to put any money away that I could toward investing even if it didn’t feel like enough at the time.
What are some of the key principles you have used to improve your financial life?
Though it was hard to put money away at the time:
- Starting an emergency fund was vital.
- I still managed to invest.
- I got up to speed on any type of money saving tip from old school ideas to any tech tool that could help.
- I did a lot of meal planning and cooking from home.
- I only bought clothes when they were steeply discounted.
- I changed any type of bill both big and small to cut expenses.
- I also took on any type of work until I figured out my next step.
- I ditched anything that wasn’t necessary.
- At the time, we had the most basic cable package that wasn’t advertised. I could get basic channels for 14.00 a month. I think they have since done away with that, but I would do anything like that to make it work.I was very careful with our spending.
- We took advantage of any free or low cost entertainment.
- The most important tip I learned is to envision the life you want and try to make your financial decisions work around that. Sometimes we end up with a house, car and other big expenses that we think we’re supposed to buy and they can keep us from fulfilling other dreams like travel.
How often do you consume personal finance information? Name 3-5 of your favorites sources (books, podcasts, blogs, etc.).
I consume personal finance information on a regular basis. I ended up starting a blog and then I got offered some cool writing opportunities for US News and Huffington Post.
The One Page Financial Plan by Carl Richards is one of my favorite books. I also listen to many podcasts. I love Stacking Benjamins, The Money Nerds Podcast, Popcorn Finance and Couple Money. Though there are many cool blogs, I don’t have time to read them as much.
Where are you on the path to financial freedom now?
I’m trying to put away as much money as I can to have my bases covered. Luckily, my business has been growing and my husband is advancing in his career so now that we are in a better place, we’re hoping to reach our goals on time.
Is there any advice/encouraging words you can give those who are struggling to escape Broke Phi Broke?
You are not less than because you have less money at the moment. Try to stay positive and still try to find ways to enjoy yourself. In my Everyday Bucket List Book, I use what I call the F.I.L.L. Method when you want to look for budget-friendly activities. It stands for free, interesting, low-cost and local.
[Editor’s Note: Again, I highly recommend that you purchase Karen’s book. It was a peerless read 🙂]
How can the readers contact you?
Read more interviews in the From Broke to Financially Woke Series.
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Jerry is a Business Insider Contributing Writer who is obsessed with personal finance. He believes you can improve your financial situation by applying principles taught by the financial independence community to your financial life.
If you are having trouble saving, he recommends that you join the SaverLife Savings program where you can get a $60 reward after six months (no income requirement). All you have to do is put a minimum of $20 a month into a savings account. Easy, right?
For a fun read, check out his article 10 Signs You’re a Personal Finance Addict to see if you are a personal finance nerd.
Before you go, check out the new From Broke to Financially Woke Interview Series.
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