2 steps forward...2 steps back?

So, here was the idea. It was the end of 95, beginning of 96. I had just left a solid company where I was making very good money for a young kid and I was joining a start-up.

Taking a cut in pay was not really a problem for me. I was young, and I did not have any financial responsibilites. I was not saddled with debt (see earlier posts) and I did not realize how I had come to rely on those nicely sized paychecks.

I do not know when I realized it, but I was back in debt (off the path AGAIN). I had not managed to cut my spending habits down to match my drop in pay, and I was living on credit. This is not all bad mind you as I had created some retirement savings, but the fact of the matter was, I was spending more than I was making. I was not sure how I got myself in this hole again, but I had to think of a way out.

Well, that covers the two steps back, what about the two steps forward? I was lucky enough to be early in the start-up game. I was there before most, just after Netscape (for those of you new to technology, they helped make the Internet popular by providing a slick browser) and well before the big run up. I would calculate my networth, and given what companies were being valued at, times my piece of this company (about 0.5%) I was loving life. I was seeing my networth in the neighborhood of $12M. That was a very nice neighborhood to be in...Did I mention that I was in my late twenties at this point in time?

With this networth, I though to myself, I should not have any debt! But there it was, sent to me on a monthly basis in the form of a credit card statement, DEBT. I did something that most financial advisors, if not all, would chastise me for...I pulled money out of my retirement to pay off the debt. Why not? Did I mentioned how much I was worth? That seemed like a very simple solution. It would end up costing me in penalties and lost earnings, but did you see my networth?

So, you might consider those to be two GIANT steps forward (the networth thing)...that is IF my company went public at that point in time...which it did not. Too bad...perhaps I should have titled this 2 steps back followed by another 2 steps back...

One piece of this that did prove positive, if only for my mental well being is that I was once again, out of debt. It may not have been the most well advised way to get out of debt, but I was very happy to have cleared that off my plate (I was hoping it was for good this time).

More to come,

Thejester