When Kevin O’Leary, chairman of O’Shares ETFs and judge on ABC’s “Shark Tank,” first learned that 23-year-old Elena Haskins lives on a $50,000 annual salary in Brooklyn, New York, he was skeptical.
“I personally think that’s impossible,” O’Leary says, reacting to CNBC Make It’s Millennial Money episode that features Haskins, which was published in August 2019. “That is not a number you can live on in Brooklyn.”
However, O’Leary was quickly impressed by how Haskins makes it work. She puts $880 per month into savings, including funds earmarked for travel, donations and gifts. Around $300 of her total savings goes into her SIMPLE IRA, which her employer matches.
It’s smart that she’s already taking advantage of her full company match, O’Leary says: “That is like free money coming out of a helicopter to you.”
He also applauds her for setting savings goals. She puts a certain percentage away as soon as her paycheck hits her account and forces herself to live on what’s left. “If you actually have targets … you can watch it on a weekly basis or every two weeks, since you’re probably getting paid every two weeks,” he says. “The way you end up with massive credit card debt is that you don’t stay within those guidelines.”
Haskins does a good job finding free and low-cost activities throughout the city, such as baking with her neighbors and attending free events, O’Leary says. She doesn’t let New York run her budget dry.
“New York is so freaking expensive,” O’Leary emphasizes. “Of course the city wants to suck every dime they can get out of you. But at the same time, people are hip to it and they’re doing their own things.”
Although O’Leary is impressed with Haskins overall, he’d still like to see her put more of her income toward paying down the $11,000 she has left in student loans. “That should be her primary focus,” he says.
That’s because “you’ve got to pay off the debt before you put a significant amount of money into investments. Investments can go up and down in value, as we all know. The stock market has volatility. But if you still have debt, that’s forever. Debt is for certain going to charge you interest.”