Yes, you read that title correctly. You may be having a WTF?! type of reaction. I don’t blame ya. Who the heck am I to be doling out financial advice of any sort? I don’t pretend to be an expert, or even particularly good at it. Last night I got enough sushi delivered for myself that three sets of chopsticks were included in the bag. THREE. Sure, it was super delicious. But I would be lying if I said I wasn’t struggling, or that I’d never slipped up, or asked my parents for help (I feel guilty, just not guilty enough not to ask), or put something on my credit card that I really shouldn’t have (strappy oxblood heels, I’m lookin’ at you!), or lived off peanut butter and jelly sandwiches and pretzel snack packs for four days so that I could cover my Friday night bar tab. It’s tough to work and play in an expensive East Coast city fresh out of undergrad (but hey, at least it’s not New York!). So when it comes to Fiscal Responsibility, I am asking myself, as well as anybody who may have even half an idea, how do I do it better?
For those of you in the Same Boat as me, here’s what I’ve learned so far, as I ooch my way ever so slowly towards financial stability and independence…
Oh my God, Becky, look at her Budget.
Yes. You really, really need one. I was lucky enough to sit down with a Real Live Expert (my friend’s mom) to go over mine. We looked at what’s coming in, what should be going out, and what was actually going out. Real tears were shed when I realized precisely what percentage of my monthly income goes straight to my neighborhood Starbucks.
I wholeheartedly recommend Adulting (this book/blog) for general grown up wisdom and some chuckles, but the chapter on money is especially useful. If you don’t have a friendly accountant in your contact list, she outlines how to make your own budget. There are also cartoon drawings of animals, Harry Potter references, and she points out that it is totally okay to be poor in your early twenties. I feel better already.
The Student Loan Shark.
Cue the Jaws theme song, because just when I’m drowning in rent, utilities, and other bills, this monthly payment is bound to start circling around me. Stay cool. It can smell fear. Obviously, this payment should be incorporated into my monthly expenses, and it is. But I set the payment plan when I had just graduated, accepted a full time offer, and was feeling very generally positive and ambitious. So I chose the higher payments at a lower interest rate for less time. It is very easy to theoretically spend less money. It isn’t so easy to actually change how you live. Now I find myself having a difficult time affording the lifestyle that I like (and I’m not exactly a high roller — I generally frown upon any “going out” situation with a cover over $5) and making the payment. So I have a few options. I can a) try to find a side gig to help cover my butt, b) spend less money, or c) re-work my payment plan so that I will have lower monthly payments, but ultimately be in debt longer and pay a greater sum. I’m still uncertain, and contemplating the Eeny-Meeny-Miny-Mo Method to reach a decision.
What to do if you are a Clothing Snob.
Or a beauty product junkie. Or if the concept of a “bargain” haircut causes you physical pain. Fear not – All of these things apply to me. This is one area where I (mostly) know what I’m talking about. I am dangerously close to reaching the highest membership level at Sephora, and I generally frown upon cheap shoes. I know you don’t need to spend money to look good, but it makes it so much easier. So what’s a girl to do?
- Think about what you are giving up. If you need (NEED!) that premium denim, what don’t you need? Are you willing to eat at restaurants less? To skip those concert tickets? There’s no right or wrong answer, but you do need to prioritize. I have just a few pairs of nice, dark jeans, about 4 pairs of good heels, and I skip on the impulse purchases of those items. My tee shirts and tanks, on the other hand, are largely from Target, H&M, and Forever 21.
- When you feel like you have Nothing to Wear, play dress up. In your own closet. Take out all those things you haven’t thought about in ages, and re-imagine them. Make new outfits. Closet shopping is awesome, and it’s free.
- While you’re in there, you will probably find some stuff you haven’t worn in forever, and absolutely are not going to. Closet space is a precious commodity. Do not waste it. Take these items to a consignment store, if they are in good condition. Donate the rest.
- I like to use the money I make from selling my old clothes to reinvest in my wardrobe. So I think about one or two pieces a season that I really want, whether it’s finally time to replace my favorite, well-worn maxi dress, or I want to purchase a sweet pair of scalloped ballet flats. That way I’m downsizing my wardrobe in quantity, but upgrading in quality. Best of both worlds.
Saving for a Rainy Day.
When I was little, I thought a ‘Rainy Day Fund’ meant wanting money for doing fun stuff when you were bored/sad/under the weather. False. This is money for when things go awry. Which, inevitably, they will. I have consulted several people and a few books, and the answers I’ve gotten to so, how much should I be saving? are varied.
Someone once told me I should be saving one third of my income. For people who don’t spend more than a full paycheck on rent, this may be a real thing. For me, it’s a hilarious joke. According to Adulting, it’s a minimum of $10 per paycheck. So I’m looking for a realistic middle ground. I’ll let you know when I find it.
Brown Baggin’ it.
I simply cannot afford to buy lunch out every day, and also to go out for dinner and drinks with friends a few times a week. So I’ve had to prioritize. If I’m going to be scarfing down food alone at my desk, I figure it may as well be a PB&J. It’s an adjustment, but you can totally get used to waking up a few minutes early to pack up a lunch. I make myself coffee at home now as well, saving takeout and Starbucks trips for special occasions and much needed pick-me-ups. Now I just need to remember not to leave my lunch on the kitchen counter…
Mind your Manners.
No matter how tight things are with your budget, DO NOT make it weird with your friends. Do not nickel and dime them when you’re splitting the bill at the end of the night. I don’t care if their salad wrap cost $1.75 extra because they added chicken. This will go a lot smoother if you bring cash. If you can’t afford to be out spending money, invite them over to enjoy the box wine already in your fridge.
If you are on a date, no matter what convention tells you, be prepared to split the bill. That look of surprise on your face if your date doesn’t stop you from doing the Purse Reach is not going to land you a second encounter. And it’s rude.
There should be no money borrowing/lending among friends.
Long story short, no matter how poor you are, do not be a dick about money. It’s not worth it to create weirdness in your friendships. It just isn’t.
Well, that’s it. That’s all I’ve got for you. Any words of wisdom you could send back my way would be infinitely appreciated. So I want to know, do you keep a budget? Do you have any special money saving tips or tricks?