Life While Financially Unstable
I think one of the most obvious parts of being twenty something is being financially unstable. I went ahead and looked up the definition of "Financially Stable" because this is a term that I have drifted so far away from, I feel like I don't even know how to begin to describe what it is. According to the internet most people define financial stability as: "an emergency fund of several months of expenses, all credit card charges and bills paid off at the end of each month, a reasonably secure job with a comfortable income, some money (say 10% of your gross income) put away each month as an investment toward retirement." To say that I am no where near this definition would be an understatement.The reason I decided to write this blog was that I have just recently discovered how financially unstable I actually am, but also with the hope that I am not the only twenty something that is feeling this way.
I want to start by just briefly describing my current situation and then hopefully offer a few tips that I have noticed help me. I am currently a full-time student, with an unpaid internship. Let me just tell you, this is not the best combination when trying to increase your financial stability. However, I took this unpaid internship with the goal of learning and networking enough to land myself a full-time paid position at the end. I have been fortunate enough that my parents pay for my school, rent and necessities. I mention necessities because I think they will agree that we have very different definitions of "necessities". According to their definition this includes toilet paper, paper towels, textbooks, or anything I might need for school. My definition definitely includes all of that, but also might include a few new clothes every few months, or those new running shoes to add to my collection of shoes. I know, I know... I sound crazy, but I will say that I have gotten drastically better since I first moved out of the house. With no current form of income, the only money I really have is in my savings account from the past 3 summers I have worked. Making $10 an hour and babysitting occasionally definitely has not set me up for being completely financially independent, but its better than nothing.
Since moving out of the house, my parents have given me an allowance every 2 weeks. The amount has changed every year, but currently I get $150 on the 1st and 15th of every month. This allowance goes towards bills, groceries, clothes and activities. I wish I could say that I am perfect with managing my money and I have more than $3 left the day before I get my allowance, but unfortanately... I can't. I often over-draw my account or have to tell my roommate that I will pay them for our bills in a few days.
With all this being said, I am definitely making it and realize that I could have it a lot worse, but I have gotten to the point that I'm ready to start doing something about my current situation.
Here are just a few things that I have tried that aren't too difficult, but definitely provide quick results.
I want to start by just briefly describing my current situation and then hopefully offer a few tips that I have noticed help me. I am currently a full-time student, with an unpaid internship. Let me just tell you, this is not the best combination when trying to increase your financial stability. However, I took this unpaid internship with the goal of learning and networking enough to land myself a full-time paid position at the end. I have been fortunate enough that my parents pay for my school, rent and necessities. I mention necessities because I think they will agree that we have very different definitions of "necessities". According to their definition this includes toilet paper, paper towels, textbooks, or anything I might need for school. My definition definitely includes all of that, but also might include a few new clothes every few months, or those new running shoes to add to my collection of shoes. I know, I know... I sound crazy, but I will say that I have gotten drastically better since I first moved out of the house. With no current form of income, the only money I really have is in my savings account from the past 3 summers I have worked. Making $10 an hour and babysitting occasionally definitely has not set me up for being completely financially independent, but its better than nothing.
Since moving out of the house, my parents have given me an allowance every 2 weeks. The amount has changed every year, but currently I get $150 on the 1st and 15th of every month. This allowance goes towards bills, groceries, clothes and activities. I wish I could say that I am perfect with managing my money and I have more than $3 left the day before I get my allowance, but unfortanately... I can't. I often over-draw my account or have to tell my roommate that I will pay them for our bills in a few days.
With all this being said, I am definitely making it and realize that I could have it a lot worse, but I have gotten to the point that I'm ready to start doing something about my current situation.
Here are just a few things that I have tried that aren't too difficult, but definitely provide quick results.
- When I get my allowance on the first, I visualize where I need this money to go. Usually, I need about $50 for bills. Then, I need $50-60 for groceries (depending how much I have left from the previous grocery trip). This leaves me with about $50 for activities for the next two weeks.
- The next thing that I do is withdraw about 2/3 of the remaining amount in cash. I say 2/3 because I feel like it is always safe to have a little bit of money left on your card. By withdrawing cash I am able to keep it in my wallet and physically watch it get smaller as I spend. I have found this is easier to keep track of how much I spend instead of swiping the magic debit card with no clue of how much I have in my account.
- The final trick that I learned was actually in a Personal Finance class that I had to take. This was the final project and it definitely made me realize that I should have listened more in the class. Anyways, we were instructed to build a budget and were given many resources to do this. Mint.com has been useful for me even after I was done with the class. You basically link your bank account to this (trusted) site and it provides you specific data about which categories you spent the most in. Personally, I was shocked at how much I spend on snacks at the gas station and since then, I have been able to cut down on this.
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