A Massive Debt Forced This 33-Year-Old To Rethink Her Life. Now With A Hefty Retirement Fund, She's Sharing How To Turn Your Net Worth Positive.

Yanely Espinal's rags-to-riches story is one she never forgets.

The 33-year-old Brooklyn native and financial educator grew up in a large household where her father was the sole breadwinner and discussions around money were mostly nonexistent. Though Espinal's father would make just enough to cover the electric bills and rent, the family often relied on food stamps to get by.

"The conversation that I often heard in my house was like, if anything, a government-assistance kind of mindset," Espinal told Benzinga recently. "I think [my parents] had this mindset of dependency on the government … My mom depended on my dad, and my dad depended on the government."

At times, Espinal's father would give her money for food when she asked, she recalled. On days when he didn't have any to give, he would scold her instead.

"It was clear that money kind of controlled him so much so to the point where how he behaved was completely a reflection of whether money was tight or not," she said.

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While studying at Brown University on a full scholarship, however, Espinal quickly found herself inheriting her parents' attitude toward money. During her freshman year, she came across a campus stall that offered free pizza and a t-shirt in exchange for a completed credit card application. Intrigued, she filled out a form, and received her credit card — along with a $1,500 credit limit — in the mail.

At first, Espinal used the card to buy college necessities, such as textbooks and a laptop. Yet, in doing so, she also saw — in her own words — "how easy it was to swipe that credit card." In just one semester, she maxed out her card and eventually applied for another card. Once she received her second card, Espinal made more purchases, buying shoes, clothes, and plane tickets. Although she tried to justify her purchases by telling herself that she would pay them off at a later time, she never paid more than the minimum that was due on her credit card.

"By the time I graduated, I think I probably spent out of pocket like a good $13,000 [to] $14,000," she remembered. "The extra $6,000 [to] $7,000 [were] all the interest fees that just were accruing each year over the four years I was not making payments."

The day Espinal finally realized how much she had paid in interest fees, she felt embarrassed, she admitted. By chance, she came across a book by renowned author and financial advisor Suze Orman at a Duane Reade two days later — a $9 investment that she said was the best she has ever made. Inspired, she did her own research at the library while budgeting as much as she possibly could. She stopped going to restaurants and bars and limited her spending to groceries and rent. At the same time, she also found ways to increase her income by tutoring, selling purses on Etsy, and babysitting.

"I really am a strong believer that you can't just tell people, you know, only increase your income," said Espinal, now the director of educational research at Next Gen Personal Finance, an organization that aims to ensure that high school students across the country take a personal finance course before they graduate.

After Espinal paid off her debt, she then turned her attention toward building wealth. The key for her, she said, was to continue imagining that she was still in debt. Instead of making payments to credit card companies, she instead put her money in a high-yield savings account. Once she accumulated three months' worth of living expenses, she began to focus on investing, drawing advice from JL Collins' "The Simple Path to Wealth."

"I just started investing in index funds, in low-cost ETFs (exchange-traded funds)" Espinal said. "No matter what, I would just buy every month. I would add another few hundred, another thousand, as much as I could every single month. For me, it was a transitional phase of like, first, your net worth is zero. That's awesome, but that's not the end goal. Your goal is to actually have some wealth. So from that point, you have to keep going with the grind."

Espinal said that, early on, she used auto-investment services from Betterment and Wealthfront to buy the Vanguard Total Stock Market Index Fund and the Vanguard S&P 500 ETF. After she felt comfortable reaching a certain amount in her accounts, she transferred her funds over to Vanguard itself.

As Espinal began to earn more income from her job, she also made sure to max out her Roth 401K and her Roth IRA.

"As I've gotten a bit older, I prioritize maxing out my 401K because I understand that: a) it's a Roth 401K, which means I don't have to pay taxes on the gains," she explained. And b) I saw my parents depending so much on Social Security benefits … I have this mindset that I have to really pad my retirement so I can retire with dignity and not be struggling like my parents are in retirement."

With the remaining money, the 33-year-old has since invested in a taxable brokerage account and even bought I bonds to protect herself against inflation. Now with a net worth well over $250,000, Espinal has leaned on her personal experience and work at Next Gen Personal Finance to help advocate for the passage of laws requiring financial education at high schools. Just this month, Indiana became the 19th state to guarantee that all high school students will receive a semester-long personal finance course.

And in addition to educating her peers and followers on her YouTube channel "MissBeHelpful" and giving lectures throughout the country, Espinal said she hopes that her upcoming book "Mind Your Money: Insightful Stories and Strategies to Help You Reach Your #MoneyGoals," which is slated for release on May 30, will resonate with — and, more importantly, inspire — readers who may be currently struggling with their finances and are searching for answers.

"I wanted my book to, first of all, own my experience in poverty, own it as a badge of honor, as something that proves and shows that overcoming adversity is not something to ever be ashamed of," she said. "And also to inspire younger leaders who now are in that situation. Maybe they're sitting in the same seats I sat in, in a local public school. Maybe they're watching their parents struggle in the same way I watched mine. By reading my story, they can actually see hope for themselves and [think], ‘Oh wow, because this is my current reality, that doesn't mean this is permanently my reality.'"

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