welcome to Money talks, a series in which we interview people about their relationship with money, their relationship with each other and how these relationships inform each other.
Bennie Covington and Krystal Covington live in Denver, Colorado with their baby boy. Bennie is 38 years old and works as an HR manager; Krystal is 36 years old and runs her own public relations business.
Between their two jobs and their recently purchased rental property, Bennie and Krystal have a combined annual income in the bottom six digits – and their savvy financial decisions over the past 18 months not only got them back the money they had. lost at the start of the pandemic, but also helped them prepare for whatever the future may bring them.
Krystal: At the beginning of 2020, my son was going to be 1 year old. I was getting my energy back, my business was doing great, I was really excited about the possibilities – and 60% of my income back then was spent on hosting live events. My last event was on March 11, 2020. The next day they started to shut everything down.
Bennie: I’m a C-level executive, and we were in the middle of our best quarter as a company. Record quarter. We went from there to sub-record quarters for the next 18 months. It was an incredible roller coaster.
Krystal: I had to close, basically.
Bennie: She had a business based on events, which changed the whole dynamic. My activity involves a lot of travel in many legal systems and municipalities. So we understood that we were on the verge of hitting a revenue wall with our organization.
Krystal and I were walking around the neighborhood, enjoying our new free time, and I said, “It would be interesting to know where we are at the end of it. Are we better or are we worse? We remembered 2008 very well, and some people came out in a better position – but a lot of people came out in a no better position.
In 2008, we were just getting started. We only had hopes, dreams and student debt. We’re a lot more established now, so we were able to not only absorb some of the blows but also be opportunistic. During the pandemic, we bought our first rental property. A fall in the market, for us, represented a buying opportunity.
Krystal: We decided to be more strategic [than in 2008]. We wanted to create a blanket for ourselves, guard against what might happen in the future, and also take advantage of the fact that we see a lot of people flocking to new homes. That’s why we decided that a rental home would be a good investment.
Now we have the second rental income, and the property has gained in perceived value – I know it’s not real, it’s just on paper, but it’s still value.
Bennie: We did the same with stocks. In 2008, when we saw the market plunge, I remembered thinking that buying would be the best decision, unless the world was about to end, in which case we would have bigger problems. This time around, we went in and kind of went looking for companies that we thought would stay healthy during the pandemic. We took some savings and bought some stocks and also bought the rental property.
Krystal: We have a mortgage on the rental property. The savings went to stocks and down payment.
Bennie: I also still had my job – I suffered a 20% pay cut, but it was still a good income. The pay cut ended up being around $ 25,000. The rental property earns about $ 440 per month, so it pays the mortgage and helps close the wage gap. Whatever we lost, we gained in equity and income.
Krystal: With my business I got an SBA loan which helped me save time to figure things out. I found a different business model strategy to try – I went from event planning to marketing services – and found different ways to use other people’s work. So far it has been working fine, but I will continue to refine and evolve!
It’s been a unique, lifelong learning cycle – but I’ve also been able to replace my income, and I’m actually making more now.
Bennie: It’s amazing when you think about it. When you go back to 2008, we weren’t able to take advantage of anything. Now we can, and it’s mind boggling – the world is completely different, depending on where you are.
Krystal: In 2008, we were in debt.
Bennie: In 2008, we were at the mercy of the market. No matter what he wanted to give us, we didn’t really have a lot of bargaining power. Lots of dreams have been carried over – and maybe it got us to this, because we never really lost that. I don’t like the concept of “working harder”, but we certainly thought “we have to do better”. We need a plan to absorb these shocks.
But the juxtaposition of those two realities – the way things have changed for us in 12, 13 years – has been very interesting.
Krystal: In 2008, I don’t think we understood the concept of ownership. Between that, and the time my husband lost his job and our savings saved us –
Bennie: We weren’t investing in the market back then, it was just in savings accounts –
Krystal: We started to live on very little and save some income. This is what allowed us to move to Colorado and buy our first condo. We saw that the market was about to get to the point where people couldn’t even buy a house anymore, so …
Bennie: We sold it and bought another house!
Krystal: We realized that the property was extremely valuable, especially in a growing market. Then, in this situation, we realized that the people who were doing really well were the people who had the property. It made sense that people who own property, people who have sources of income that are not tied to employers, do well.
Bennie: We are in that position right now due to the period between 2008 and 2020. We recognized that we weren’t able to absorb the declines, so we decided to get proactive. When the pandemic came out of nowhere – and these things still happen – we were able to look for opportunities. But we would not have been if we had not spent the period 2008-2020 preparing ourselves.
Krystal: We also used this time to educate ourselves. We watch everything about FIRE, we read all the stories, we share, “Oh, these people earn as much as us and that’s what they do with their money, it’s interesting”, and talk to us through she. We read books together, we try to listen to the same books on Audible, because hearing the information and talking about it – “What do you see in this philosophy? – helps us to understand that there are different paths.
We also both worked in the financial industry for a few years. I was in communication and he was in training / development. Being next to it all helped us too – being with all these people who had a lot of money and were talking about it.
Bennie: In 2008, there was a narrative and there was data. We tracked the data. How did people find themselves financially stronger when the recession ended? We weren’t looking at the 1 percent, we were looking at the upper middle class. No one was talking about it, but I was intrigued – what happened there? What enabled them to do this? That’s what I had in mind when 2020.