Personal finance: how a video game designer manages money

NerdWallet’s How Do You Do Money? series asks people from various walks of life to share their attitudes and approach to personal finance, with the goal of bringing transparency to discussions surrounding money. In this installment we speak with Jeff Clarke, a 26-year-old game designer living in San Francisco, California. This is how he does money.

What do you do for your main source of income and how did you get into that line of work?

I am a game systems designer.  It’s my job to balance the game as well as create the interplay of systems (think health vs. damage) and make those fun. I got into the game industry sort of serendipitously.  I graduated from UC Santa Cruz with a degree in English literature.  Not precisely the most saleable degree, so I went to law school.  Not too long after, I dropped out of law school.  I started applying to non-engineering roles at various companies up and down the California coast – office manager, customer support, and receptionist type work.  I got hired at my current company as customer service, then I got promoted into Quality Assurance, did that for two years until I got promoted into the design role I currently have.

Would you like to be doing something else instead?

Absolutely not.  I found that I quite enjoy game development.  It’s tough, somewhat frenetic, but always exciting. 

About how much do you earn before taxes per year?

$70,000.

Do you feel secure with that amount?

Yes, I do.  Sort of.  I think that we, as workers, always feel as though making more would make things better, so I try and keep a mature head around it instead of the game of “Well, what if I made 80K?  What if I made 90K?”  There’s always the illusion of more secure.

I think that’s a good point, it’s very rare that anyone feels 100% secure with the amount they’re making because there’s usually the potential for more.  Do you have any debt?

Oh boy, do I!  I have around $20,000 in debt.  $19,000 of this is from six months at law school.  I have been paying it down quite a bit over the past three years.  The rest is a credit card.

Do you think incurring that debt was worth it?

Worth it in what way?  I feel as though my $30,000 mistake (law school) is worth it because without it, I probably would never have gotten in to where I am today.  The credit card is probably not so much…I really should hide it away and not use it unless necessary.

Do you have any savings goals?

Yes.  I have two major goals: restore my emergency fund to two months of living expenses, and save for a new computer.

Are there any resources or tools you’ve used to learn about and manage your personal finances?

So, I sporadically use Mint.  I feel like I have a bad relationship with it.  I neglect it, I roll my eyes at it, maybe even call it names when it shows me something I don’t want to see.  I tend to look at it once a month or so, determine what state my finances are in, and then move on.  Knowing where everything stands at a glance is pretty handy, but it’s also something I should start using more often.

How was the topic of money approached in the home you grew up in?

When my brother and I got old enough to understand what was going on, money became more of an open topic.  I knew at a young age how much certain bills were and similar figures, and I knew when we didn’t have enough for some things.  When I was a teenager, it was a bit more open.  My dad would spend an afternoon once every week or two and balance the checkbook, and I’d hang out and ask questions.

How do you think that affected your attitude money and your personal finances?

I was able to watch my parents pull themselves out of the debt of my childhood, and also able to watch my brother make some bad decisions through my life.  I think being open with my family about finances made things incredibly easy for me to understand things like balancing a budget and trying to work within the limitations of said budget.

Has your approach toward personal finance changed from the time you left home?

Yes, yes, a thousand times yes.  Actually, probably not.  I like to think that I am pretty good with money, which causes me to not really change how I do things.  I usually keep a mental budget and can pretty much tell you how much is in what account at any given time, however that’s not the most sustainable way of managing my finances…I’ll look at Mint and my other various banking/financial apps on a regular basis, and I’m starting to work on some savings goals.

What is the best monetary investment you’ve made?

This is going to sound really weird, but give me a moment to explain.  While I don’t have a single monetary investment, I think, as a whole, video games have been one of my best monetary investments.  I bet your eyes just fell out of your head as you read that, but as a game designer, I have to be competitive.  I have to know what is out there, and I have to be able to distill the mechanics of those games so that I can figure out what makes them good or bad.  I have to be able to compare them and analyze them to determine whether it’s different enough, or fun enough, to then compare to any game I’ve worked on or are working on.  I bet you don’t believe me yet.  If I can’t talk games, say, in an interview or a discussion with my boss, I lose credibility.  If I don’t immediately know what’s out, or what certain companies put out, I can lose credibility.  Investing in video games keeps me employed so I can buy more video games.

That makes sense, it sounds like knowing what’s out there helps you deliver the best quality work you can.  What monetary investment do you regret the most and why?

I really think I messed up selling my car and moving into downtown San Francisco.  I’m in a rent controlled apartment, but the car was paid off and I quite miss driving.  That’s more personal than investment.

What does financial stability mean to you?

That’s tough.  It means a lot of things to me.  To me, I think it means being able to have enough money to allow for some freedom.  This’ll sound ridiculous, and perhaps a little privileged, but I measure frivolous expenditures on the “Starbucks” meter.  Well, can I live without coffee for three days if I want this thing?  Well, can I expect to drink work coffee all week because I wanted this other thing?  It helps put things into (a terrible) perspective, because instead of money and the magic plastic card, I can put it into things that are more quantifiable in my head.

What financial accomplishment are you most proud of?

I recently did a deep-dive into my finances in order to start working on a budget.  I know that Mint can tell you a breakdown of your expenditures, but I really think doing it for yourself and setting your own categories means a lot.  The added difficulty of going through the spreadsheet kung-fu to make it work is incredibly helpful in opening eyes at spending.  I know I surprised myself at how little I spent on games the last two months and how much I spend on restaurants and “luxury” items (like Starbucks.)

Yeah, I think small purchases can really add up without one realizing it.  What is a question that you’ve had related to your personal finances, either in the past or recently?

My work offers a sponsored 401K plan but no matching.  I put $112 into it a month.  Is it worth it?

NerdWallet asked Guy Baker, CFP, from our Ask an Advisor platform, and his advice to Jeff is:

Is it worth it? Absolutely! What is your number? This is how much you need at retirement to replace your income. Take 25 times your salary and that is a good estimate of how much you will need in savings. I know $112 a month does not seem like much. But it will add up. Every $1,000 you save today, if you are 25 years old is worth $15,000 at age 65. The longer you wait to save, the less it is worth. A 25-year-old needs to be saving 15%+ to have enough at age 65 to live off their capital. So, yes it is worth it and you need to be doing more as soon as you can afford to do it.

Do you, or someone you know, want be interviewed? Email Heather.