I phoned my friend and said, 'These things are printing money,' with a touch of enthusiasm in my tone. We both kept our eyes fixed on our Robinhood apps, observing as the value of our Blackberry call options skyrocketed, doubling in just an hour.

 

In January of 2021, at the peak of the free money era following the COVID-19 pandemic, risk was the name of the game for young retail investors like myself. Whether that meant speculating on out-of-the-money Gamestop calls, gambling on whatever shiny new altcoin Reddit blew up about that day, or even leveraging debt to get into the real estate game, risk was everywhere. But back then, it didn’t feel risky to me. I felt invincible.

 

 

That was the prevailing mindset, and I did exactly those things. Consequences seemed few and far between. However, I soon learned that money is never free, and there are always consequences. Markets love to punish.

 

In December of 2021, fresh out of college, I started a new job at Finotta as a software engineer. As someone who has always been interested in personal finance, saving and investing, the company's mission immediately appealed to me. However, while I was passionate about our mission from the start, I had not yet incorporated our financial recommendations and algorithms into my own personal financial habits.

 

As the year 2021 transitioned into 2022, I refused to accept that my risky financial mindset needed to change. Even as the Federal Reserve began its first hike of the cycle, I decided to purchase a house, without fully understanding the larger implications of my actions. At Finotta, we always suggest our users to not take on a housing payment that exceeds 30% of their net income. However, I found myself doing exactly that. The irony of the situation was not lost on me.

 

Then the Federal Reserve began hiking rates in earnest. Inflation soared, and talk of recession filled the air. The hangover from all that free money began to set in, and slowly but surely, I started to realize that I needed to make some changes before I found myself on the wrong side of this new rising interest rate regime. Home values started to fall as the shock of higher rates set in, and for the first time, I felt vulnerable to larger economic forces. Simultaneously, working at a startup, I realized how naive it was to take on the amount of risk I had in the face of so much uncertainty. If a recession did set in and I became another tech layoff statistic, I would be in serious trouble. Finally, I decided it was time to take Finotta’s (our) advice—the very recommendations I personally programmed into our technology.

 

So, what did I do? I took on a roommate to reduce my housing expenses and followed the advice of our Financial Coach. I opened a high-yield savings account and quickly built a six-month emergency fund. I used the rest of my disposable income to repay my mortgage debt and build my investment accounts. I followed the same system that makes Finotta's Financial Coach so successful with its users - I gave every dollar a job, prioritizing savings, paying off high-interest debt, and then investing. This approach provided me with a strong financial position and a safety net, even in a deteriorating macroeconomic environment.

 

Through sound personal financial guidance, I realized that my risk-taking mindset was holding me back financially. However, with the right support, I was able to achieve a much stronger financial position than I thought possible in 2021 or early 2022. I've found myself thinking about other people throughout this journey. I understand that financial struggles can be overwhelming and challenging, and others may be facing similar or entirely different issues. 

 

The specifics are not significant. What is significant is that we have built something that assists users at any stage of their financial journey, whether they have a risk-taking attitude like me, are grappling with pressing financial emergencies, or just don't know how to invest their money.