From Savings Anxiety to Financial Confidence: My Year of Invest

My theme for the year in 2024 was "invest," I chose this theme because I noticed that I was running on empty and doing everything I could for other people while spending very little time thinking about what I needed. I have always believed that parents need to be good models for self-care for our kids but I wasn't doing this very well. 

A little background: I decided to put myself through graduate school from 2019-2021 (yes, those were, we'll say, interesting years to have young children and be a full time student). This led to a career change from running child development centers to a different career in the field. This change led to an increase in my base salary which made me realize I didn't have much knowledge about personal finance or finance in general. 

Back to 2024: Invest as an overall theme helped me to think about investing in the broadest sense and truly was investing in myself. While I did have goals on physical health and mental health under the invest theme, this post is about the most tangible form of investing- money. 

My 2025 theme is Peace: you can read more about my present day journey here

What were my money goals? 

1. Increase money in interest earning accounts
2. Career plan a pay raise or job change to be executed in 2025
3. Learn to use investment account 

Before I share my progress on these goals, I want to talk about the journey because (if you'll pardon my road trip metaphor here) the destination has more to do with the actual conditions of the road and what turns you choose to take then what you intended to do when you left the house. 

Throughout the year I took notes on progress about 9 times and I referred back to those notes as I am writing about the year. I highly suggest making some time to write about the progress on your journey to keep yourself grounded. It doesn't have to be perfect, mine are in my notes app and I meant to do it monthly but...life. 

Overall, this was a pretty exciting year of growth for me. Since I didn't have a lot of money growing up, I have been risk adverse in terms of money and prefer to just save in the easiest ways. Case in point: In 2023, I set up my first CD- a 1 year $5,000 deposit- and I was so anxious about locking up the money that I couldn't sleep even though I had plenty of cash to handle any emergencies. 

I really had to work my muscles and dig into a new world. With so much to learn, I turned to what I know best: books! 

The first book I read was Rich Dad, Poor Dad by Robert Kiyosaki because I had heard the title before. After my year of invest is over, I realize not all of his advice is very sound, HOWEVER, his stories are super inspiring and helped me feel brave enough to just jump out there and new ideas a go. He gave me the foundation for understanding the importance of passive income streams. 

This book brings back a really special memory: Right when I finished Rich Dad, Poor Dad, I called my best friend up and made her meet me for coffee immediately to talk about real estate investing. We sat in a pretty disheveled and dusty Peet's (Lakeshore plaza for those in the know) at the end of the day drinking our lattes and dreaming about a future we could build together. That moment was really special and while we may not end up taking the real estate investing path (who knows!), I credit this book for giving me a spark. 

Funny enough, I don't actually remember the next book I read- my notes just say I "checked out one book that was stupid." Ha, past Kimberly had jokes. This does sum up the experience of trying to learn about money though. There are a lot of books and articles to read and they generally recycle similar ideas OR are trying to part you with your cash. Probably the most important principle I learned during this year was that I am smart enough and have the resources to manage my own money. It takes a lot of research but it's worth it to me to not pay fees and to actually understand what I am doing. I also apply this to whether I should get into any kind of new investments: I ask myself, do I understand why this works or how it will make money and if I don't, I'm not ready for it (or it's stupid to borrow my own words.)

The most influential book I read of the year which set me up to actually understand personal finance principles is JL Collins' The Simple Path to Wealth.  My colleague actually lent me this book and I am so grateful. There are a lot of great ideas but I will sum it up as: 1) Spend less 2) Make as much money as you can reasonably 3) Save it up so it builds upon itself over time 4) Invest in Vanguard's entire stock market index fund. (I saved you several hours if you're not a reader!) This book is NOT new but that's kind of the point of it. I liked this blog post he wrote about updates to the system. 

About this time, I also started reading some reddit threads on "FIRE" (Financial Independence, Retire Early). My husband is a bit older than me and I'd like to retire with him so this lifestyle really speaks to me. A lot of people write about this so do a search if you're interested! 

So, how did I do? 

Increase Savings in interest earning accounts

 At the beginning of the year I had a high interest savings with Alliant and a few small CDs with Alliant and a very low interest rate savings account connected to my checking account. By the end of the year, I closed the low rate account and rolled all the money into Alliant, I also opened a Vanguard account and set up automatic investments once they were opened. I also set up 529 Savings accounts for my kids and my nephew. 

Saving for the future for the kids in my life has become incredibly important to me as I get older. With rising costs of college and housing making life unsustainable for young people, I want to do what I can to support them have a strong start. 

Career plan a pay raise or job change to be executed in 2025

This goal helped me focus at work. I took on high value projects that I know have potential to be interesting in the long run. I also realized that I was overly nervous about salary and that with my current job and savings (remember I am 39!) I am in a good position retirement wise. I also realized I don't really ant to work harder at my day job and started thinking more seriously about passive income to build wealth instead of my W2 job. (FIRE people say that- it makes me sound so fancy!) I've been at my current job about 2 years and I am very connected to the mission so it's a good place for me to be. 

Learn to use investment account

This was the hardest goal because I was really frustrated at times with my lack of understanding. Funny enough, I specifically wrote this goal about using a Merrill account because my regular banking app made it super easy to open a Merrill investment account since BofA owns Merrill (or maybe the other way?) but I found the system so difficult to use that I actually seeded my account with funds and then withdrew it all and closed the account, moving everything to Vanguard where I already have a Roth IRA (the best gift my 20 year old self ever gave me). 

I had to be a lot more comfortable with risk over time and I started slow and invested using JL Collins' advice in low cost index fund. I didn't know at the beginning of the year that you need a minimum of $3,000 to buy into an index fund so I created a special savings account that my earning go into that I use ONLY for investing. This helped me save over time and was a reminder to myself about my goals. I keep tabs on that account and if excess funds are there, I move them. 

Vanguard's app and website are VERY easy to use compared to Merrill and they have a large help section where I found advice. I did not know the difference between Merrill and Vanguard at the beginning of the year but I now know that Vanguard has a reputation for being easy to use and having very low fees and that was totally true in my experience. 

Takeaways from the Year of Invest: 

My confidence about personal investment soared because I took the time to do research and think about my goals. I am really glad I decided to do this before I turned 40 because I have many more working years and now have a solid foundation to make financial decisions.