Rich’s Financial Origin Story: From Farm Boy To Theology Student To High Income Professional

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Penn Station,

When I take a step back and consider your financial origin story, I don’t disagree at all with your assessment that you’re doing alright. Sure, you racked up some debt, but your income has stabilized and you have a plan going forward. More than anything, what I see is a family that took a while to figure out what it wanted to do career-wise.

I don’t know if you remember this from when we were kids, but I think I always had big aspirations. I don’t remember thinking about getting rich, so it wasn’t about money, but I do remember wanting to do something exciting, like becoming an astronaut or an archeologist (in the mold of Indiana Jones). I haven’t quite made it to space (yet!) or to hidden treasure, but the desire to explore stuck with me.

The other factor is that I always wanted to be really good at something — to be competent, and in that way “successful.” Earning a high income wasn’t the goal, it came about by accident! It took me a while to figure out my career path. I kind of meandered through college and grad school, pursuing my interests, and then found myself in the right place and the right time to land a career starting in 2002, at age 27. Since then, I’ve steadily advanced, and my base salary has ballooned from $39,000 per year to $140,000 now, from around $19 an hour in 2002 to $70 an hour in 2017 (2017 isn’t pictured — the increase is due to a recent promotion).

Click to enlarge image.

A note about the charts in this post. The numbers aren’t simply my salary and aren’t exact in terms of total income. I drew the info from tax returns and social security statements, so what you’re looking at is more like Adjusted Gross Income from salary and investments. For example, in 2012 I had a good sized investment gain so that was my highest year. The past 2 years, I’ve been working less than 40 hours a week, which explains the drop.

I’ll add in Mrs. Rich’s income later, but first I want to explain more about my journey, because it was a bit odd, and I think I’ve learned something about education, work, and role models.

So let’s go back to the beginning. The very beginning.

Early Years: Learning, Working, and Following

The Big Bang.

Just kidding.

Birth. Obviously! You know this part but for our readers: I was born into a small farming community in Minnesota, the last of 6 kids. The baby of the family, le benjamin as they say in French. The term is a biblical reference — Benjamin was the final son of Jacob by several years. Theology and French will become more important later in my story.

Why mention birth?? Because I’ll never discount the aspect of luck in life. My family was healthy, supportive, fairly well educated (compared to previous generations), and hard working. I wasn’t born on the Kennedy compound (probably a good thing), but to be born in the USA in 1975 with a decent genetic makeup and a nurturing environment is, in the history of human civilization, a winning lottery ticket.

In addition to sports and video games, which you and I played for countless hours, my early years were dominated by 2 activities: School and Farming.

Continue reading “Rich’s Financial Origin Story: From Farm Boy To Theology Student To High Income Professional”

Penny’s Financial Origin Story: Debt Does Not Equal Regret

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Dear Rich,

I know we used to be close as kids: playing video games together, kick the can, Blind’s Man Chef, making those silly little movies that we thought were amazing, all of that. But we haven’t really kept in touch with each other much past high school, and you’re probably wondering how I got into all this financial debt in the first place.

So, I’d like to tell you a little bit about how I ended up where I am, with the amount of debt that we have, and how we got here. It’s my Financial Origin Story, if you will.

It all started when I graduated from high school in 1995. I attended the University of North Dakota for one semester, came to the conclusion that:

I didn’t really know what I wanted to do with my life and I didn’t want to spend a bunch of money finding out.

So I dropped out and attended a technical college instead. (A much more affordable option for someone who doesn’t know what they want to do with their life.) I got a “degree” (I think it was more like a certificate) in desktop publishing. A desktop publisher is like a poor man’s graphic designer. (Please don’t judge me by the graphics I make for this blog. I’ve been out of practice for awhile, and I honestly just try to get them done as quickly as possible.)

I got a job working at a newspaper / printing company, where I designed things like newspaper ads, brochures, letterhead, business cards, flyers, etc. My yearly earnings were around $18,000.

In 1999, at the age of 22, I got married.

At that time, Mr. Penny was attending the University of North Dakota. He was 21. He did not drop out, and wound up graduating with a degree in elementary education. We paid for his college though my full-time job and his part-time job, so he graduated without having any student loans.

In 2001, Mr. Penny got his first teaching job at a Catholic school outside of Chicago. I studied photography a bit at a community college and worked at an Outback Steakhouse.

The next several years saw him through a couple other teaching jobs (one teaching computers at a public school, another at small town Catholic school), and us having our first child and starting our family together.

Then, in 2006, Mr. Penny decided to go back to school to become a chiropractor. This is the part of our story where the student loans come into play. Over the 4-½ years that he was in studying to become a chiropractor (he spent a year getting some prerequisites in), he racked up around $180,000 in student loans. Neither of us really worked during this time (I wanted to stay at home with our growing family and Mr. Penny had enough on his plate with schoolwork and family life), so we took out loans to cover our living expenses as well.

I don’t regret this. It was more important to us (and it still is) to have a balanced family life than it was to have zero debt.

I did a little bit of work here and there during this time: I started my small (on-location, natural light) photography business, I taught childbirth classes, I did some art shows, I did some freelance work for a magazine. Whatever I felt like doing, I guess. I got to set my own schedule with all of these things, which was nice. (I can’t imagine going back to work an 8-5 job for someone else ever again, by the way.)

During his last trimester of chiropractic college, Mr. Penny did an internship in Colorado. We had three kids by this time. We were planning to move to Vermont after this internship (don’t ask me why, but I’ve always had something for Vermont), so we sold almost everything we owned and moved to Colorado for three months. We lived in a crappy little apartment. When we moved there, we noticed someone had put a used couch and a TV cabinet out by the dumpster, so we took them and put them in our living room.

This is what our living room looked like:

I can’t believe we lived like that for three months, but it wasn’t too bad, and it was actually kind of a fun adventure. We slept on air mattresses and on a mattress that came with the couch.

Continue reading “Penny’s Financial Origin Story: Debt Does Not Equal Regret”

Monthly Happiness Report: Rich Pursues The Good Life Through Books And Podcasts — April 2017

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Very happy to see that your past month was a happy one.

As I mentioned, I’m leaning toward “The Good Life” as a better way of describing satisfaction with life, because it encapsulates factors like love, virtue, work, and health. But I’ll still use happiness as a shorthand.

In the past month, I can say life is darn good. No big changes, but darn good nonetheless.

Let’s look at the numbers:

4 is my baseline, and I’d say I’ve been happier than usual, clocking in at 4.63 this month.

Here are some highlights from each category:


  • Family: Still steady at 4.5. As usual, twin boys = chaos, noise, and physical destruction. But we’re in a fairly good groove handling the hubbub. Additionally, Mrs. Rich and I just celebrated our 9 year anniversary! The only reason I’m not a full 5 is I’m far from my extended family.
  • Friends: I had a fun guys night out. It doesn’t take much for me to be content with friendships.


  • Work: The job is fine, not much to report here.

  • Hobbies: In addition to writing on this blog, I’ve been reading good books and listening to interesting podcasts. Specifically, I just finished Purity by Jonathan Franzen. Not as good as The Corrections, but I enjoyed it. I’ll touch on the podcasts in the mental health section. I like that my hobbies give me a double bonus by helping my mental health stay strong.


  • Experiences: We continue to take advantage of living overseas. And notice, my Freedom category has been at level 5 for a few months now, and I’m not a retired millionaire. I think Freedom is largely a function of living the life you want to live. Freedom is not the absence of obligations.
  • Recreation: Fun meals out and beach time with the kids and Mrs. Rich.


  • Physical: I finally got this up to baseline. No dental work, no sick days, and eating healthy food has become a habit. I’ve never been a soda guy, and lately I eat very little red meat or processed foods. If I can increase my workouts I’ll be in business.
  • Non-physical: My mental health has been bolstered by listening to the Waking Up podcasts by Sam Harris. The link is to his podcast page. The image is of his book of the same name, but the podcasts are broader in scope and cover a range of topics from morality to religion to consciousness to artificial intelligence. I love when good thinkers are unafraid to challenge conventional wisdom in ways that are honest and logical.

Are there any thinkers you regularly read or follow to stay sharp? I’ve been through many. Currently it’s Harris, but I also like NT Wright, Christopher Hitchens, and Dave Barry.

In happiness,



Monthly Happiness Report: Penny Has Her Happiest Month Yet! — April 2017

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Dear Rich,

I think I’ll take a page from your handbook, and work your little happiness algorithm to see if it matches up to my happiness level this month. But, as we talked about when we were reviewing that book Stumbling on Happiness… is happiness really the point of this all? I like how you said that “love is probably a better indication of what gives life meaning, more so than happiness.” So true. For instance, my toddler is going through this phase where he yells at me for the stupidest things, like sitting on the toilet to go to the bathroom. He just yells at me, “Nooo! Don’t do dat!” I’m not particularly happy when this happens, as it is super frustrating and there is no time I would like to be yelled at less than when I am trying to go to the bathroom. I like having children, but it isn’t always filled with happy times, as you well know.

You’re right when you say that love is probably a better indication of what gives life meaning.

But, back to my happiness for this month…

If I were to rate it on my own, without the help of your happiness algorithm, I would give it:

A pretty happy month, overall.

Now, if I run your algorithm, let’s see what I get:

Hey, look… your happiness algorithm was pretty accurate!

I don’t think I’ll do it every month, since I can probably make a pretty accurate rating without it, but it was fun to quantify it this way this time around.

I’ll do the rundown, just like you do:


  • Family. All is well on the family front, except for the annoying toddler.


  • Work. I don’t have a paying job, so I’m qualifying homemaking and mothering as my work. It’s going well (except for the annoying toddler).
  • Hobbies. I read a lot. Go for walks. Those are my hobbies right now, and they are balanced well within my life.

Continue reading “Monthly Happiness Report: Penny Has Her Happiest Month Yet! — April 2017”

Rich Explains Why High Income Earners Feel Woozy At Tax Time. He Pays 9 Times More in Taxes Than Penny.

Why does the rich guy always look like a creep?

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Penny —

Tax time. Blows. Chunks.

Well, I can be a little more descriptive than that.

It blows big chunks of regurgitated money vomit. 

Puke is a good description, because it’s eating something, tasting its goodness, and then spitting it up into a complex system of pipes. Maybe it’ll end up being recycled for a good purpose somehow. That’d be nice. But from my perspective, it goes down the drain and leaves me wanting to brush my teeth.

Feels better to get that out, doesn’t it? Here’s the truth: I actually don’t mind taxes. I’d rather have a decent income and pay taxes than to be homeless and pay no taxes. And, I appreciate (rationally, if not emotionally) the good that comes from taxes. Roads. Fire Stations. Aircraft Carriers. Food support. You know, the good that flows to my fellow squirrels from the Central Oak and all that.

I actually wouldn’t mind if my taxes were used a bit more for the common good of society — for more affordable health care and social services and universities, a la Europe. But that’s just me.

Penny, you’re in an interesting spot right now, right between poverty level and self-sufficiency level, according to the tax code. You wouldn’t want to earn less money, for obvious reasons, but earning more money means you’ll lose some of the benefits of our tax system. You’ll need to earn even more to experience a real financial benefit from earning more. Ironic.

Welcome to the middle class and the joys of a progressive tax system, I’d say. But you’ve got a ways to go to really pay some tax. Here are your current numbers compared to mine, just for fun.

That’s a difference of $67,887 in tax money paid / received.

So I earn 5 1/2 times more than you in AGI, but pay 9 times more than you in taxes.*

[*Yes, I realize you pay zero taxes and any number times zero is zero, but the calculation is you’d need to pay back your $7,604 refund just to get to zero, and then pay $7,604 another 8 times to reach my tax liability.] 

I think Uncle Sam loves my family. We’re in the upper middle class tax paying sweet spot. We earn enough income that we can pay a ton of taxes, but we don’t earn so much that we can utilize the tax strategies and shelters of the truly wealthy.  

Continue reading “Rich Explains Why High Income Earners Feel Woozy At Tax Time. He Pays 9 Times More in Taxes Than Penny.”

Penny Is A Broke Gal Who Pays No Taxes. By Earning More, She Ends Up With Less!

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Dear Rich,

It’s tax time again! We’ve actually had our taxes done for months, and I noticed that we are getting a smaller refund than we did last year. See, in the year 2015, our adjusted gross income was $27,911. So, last year, we received a federal refund of $7,321 and a state refund of $2,655.

Well, the 2016 tax year, our adjusted gross income was $38,944. So, our federal refund was only $6,497 and our state refund was $1,107. This means, we got back $2,372 less this year than last, which, as you know, is a big deal to us (see a bit how it affects us here).

And the reason for the reduction in tax refund is because of the Earned Income Credit. With the Earned Income Credit, the less you make, the more you get back (assuming that you’re making something to begin with). Take a look at this chart, brought to us by Equitable Growth:

See how the amount kind of tapers off after we start earning $40,000 or more? (I’m married with more than 3 children, so you can look at the very top lines of the chart.)

This is something for us to be aware of, as our tax refunds mean a great deal to us at this time. I can kind of understand how people can get trapped in the welfare system, and not wanting to earn more because they’ll lose their benefits and stuff like that. I get it.

So, this got me to thinking more about how our financial picture will look when we start making more money. Which, I assume we will, because my husband’s business has been on a consistent upward trajectory since he started it, as you can see here:

As you know, we are also on food support. I looked up the income limits to food support and they are $53,760 annually (for a family of six). So, we could possibly be done with food support within a year or two.

Continue reading “Penny Is A Broke Gal Who Pays No Taxes. By Earning More, She Ends Up With Less!”

Monthly Money Check: Rich’s Expenses Are Lumpy. $150,000 For Child Care Lumpy. So Why Track Coffee? — March 2017

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Hey Penny,

I think a lot of people who read personal finance blogs do so because they want to see in public what most people keep private. It’s financial voyeurism. Money porn.

What’s funny is we receive around 2 readers per day who, apparently, are searching for some combination of “money” and “porn.” I don’t think a personal finance blog is what they have in mind. Imagine their annoyance. “Hey, this isn’t money porn! It’s just a couple bloggers who are cousins bickering over nonsense!”

My question is, what the heck are they actually looking for??

Don’t answer that.

Ok, let’s have a look at my finances for the month of March. First, net worth.

Click to enlarge

In March, Mrs. Rich and I got paid 3 times. That’s the primary reason our net worth jumped by $22,488. Our average net worth gain per month in 2017 has been $12,358, waayyyy ahead of the pace we need to reach my goal of $1MM when I’m 45. 

Now for the bad news. We won’t be able to maintain this pace, because we’ve got some lumpy expenses coming up. 


I’ve been tracking my expenses for 3 months now. I’d never done it before, but I thought it’d be interesting money porn for you and our readers. Have you found it … exciting?

I think I’ve confirmed 2 truths about my budget that I had suspected. First, we spend a lot on food (average = $2,200 per month). It’s more than I expected, but not ridiculously more than I expected. We’re not frugal when it comes to food, I knew that already.

Second, I’ve confirmed to myself why I don’t usually track regular, recurring expenses. This will sound crazy: I don’t think they matter in my situation. Look at this chart (click image for a better view):

Something is jumping out at me here … click to enlarge.

Everything is in a narrow, somewhat predictable range, and then BOOM — half a year of preschool for 2 kids for $12,000. In the past 2 years, we’ve spent, I don’t know, $60,000 on preschool-related expenses. We more or less had to send our kids to this preschool because we’re in a foreign country, but even without preschool we’d still need full time child care. In the past 5 years we’ve spent $150,000 on preschool + child care. Conservatively.

Continue reading “Monthly Money Check: Rich’s Expenses Are Lumpy. $150,000 For Child Care Lumpy. So Why Track Coffee? — March 2017”

Monthly Money Check: Penny Racked Up $98 In Birthday Freebies — March 2017

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Dear Rich,

In this month’s edition of There’s Always Something, we were hit with a $228 bill to repair the ignitor switch in our oven and we needed to get a new printer ($75). Boo! Darn these unexpected expenses!

Now, before I get into the nitty-gritty, I’d like to point out something that you might find amusing: We went to a fundraising event for the school my kids go to. In the past, these events have been for general school things. But this year, and we didn’t fully realize this until we got there, it was a fundraising event specifically for Tuition Assistance (which, being low-income, we already get from the school). So, when we went there, we were thinking about how we were paying money at this thing that would go to assist ourselves. I thought you would find this an interesting paradox, since you’re always picking on me for giving to charity and stuff. Ha ha, real funny stuff.

Anyway, back to business.

So, I was hoping to break the $2,000 mark in spending (before student loans), and let’s look at how I did:

As you can see, we didn’t do it.

For one thing, we had the oven repair and the printer. The entertainment expense was higher than usual, due to some concert tickets that were bought for a concert in the future. The restaurant expense was higher because I counted the school’s fundraiser thing as a restaurant expense since we ate there, plus we bought gift cards ($65 worth) for restaurants to be used in the future (that money also went to the school). Higher gift expenses than usual due to birthdays this month (mine and my daughter). We bought my daughter minimalist athletic shoes that cost $81 for her birthday, but I filed that under Clothing. (As you know, minimalist footwear is one of the few things that I value, so we spend more money than we normally would on stuff like that.)

And, well, there you have it. I’ll aim to get under $2,000 next month. I know we can do it one of these months.

Now, let’s talk about all the Birthday Freebies I got this month!

Continue reading “Monthly Money Check: Penny Racked Up $98 In Birthday Freebies — March 2017”