Let’s talk money. We just spent a lot of money on a degree we were promised will pay off (let’s hope so, right). Now we’re broke, fresh college grads making a real salary but still paying for groceries, housing, utilities, car payments possibly and recreational things. How can we budget our money to cover the things we have to, spend some on fun things, and also put some away for a rainy day?
My dad always taught my sister and I about the importance of saving and budgeting. I remember him trying to explain the importance of investing in the stock market when I was in high school (that stuff went and still goes right over my head- sorry dad). But while I still may not understand the stock market, I do understand the importance of saving and budgeting your money. Here are my 10 tips on how you can save your money…
1. When you get your paycheck, decipher beforehand how much you need (for rent, groceries, utilities and recreational) and then put the rest in a savings account in the bank. For me and my personal finances, I always tend to put about 60% in the bank, then divide up the remaining 40% for the things I know I need to buy/pay for that week. (DISCLOSURE: This is different for everyone! The percentages change depending on your current status, how much you make etc. While some may be able to put 60% in the bank, others may only be able to put 40% and that’s fine. The important thing is that you are saving some of every paycheck and budgeting so that you put your bills and expenses first).
2. Limit your eating out to 1-2 times a week. This can be hard especially when you’re working full time and want to just leave the office and get something quick to eat. If you can force yourself to pack your lunch the night before you will save a lot.
3. Make coffee at home. This has to be the hardest one for me. Coffee is the one thing I won’t even blink an eye when the barista says “that will be $6.75, please.” But it’s an expensive treat that I save so much money by only buying coffee on the weekends.
4. Use cash! This may sound confusing but it’s true. When you only handle with cash, you end up saving money. How is this possible you may ask? When you use a debit card, it’s easy to overlook how much you are spending. It’s also easy to forget how much money you have spent collectively. When you use cash, once the money is gone, you know it’s gone because your wallet is empty. You’re also not tempted to spend “$5 of next week’s recreational budget” because you don’t physically have it with you.
5. Shop only for the things you need. I know this may sound obvious, but especially for those of us who like to “just shop around” it’s way too easy to walk into your favorite store with intentions of “just looking” and end up buying something. I’m not saying never do that- because I agree, there’s almost nothing better than going to the mall with my sister, but try to limit those trips to once or twice a month. And if that’s still too hard for you, then I suggest leaving your wallet in the car. :)
6. Go to Aldi. You may not have an Aldi near you, but what I’m getting at is don’t spend too much money on groceries- especially as a post college grad. Yes, you can get a beautiful looking, organic pineapple at Whole Foods for $10, but, in my opinion, the $3 pineapple at Aldi does the job too.
7. Use public transportation. If you live in a rural area, this may not apply; however, if you live in a more urban area, I suggest learning the bus and train system of your city. I’m from Chicago, so public transportation is a great option for me. Using public transportation and walking where you can, you save a lot of money on gas, and ultimately car repairs.
8. Limit your streaming services. I’m a little weird. I’ve never had a netflix, hulu, spotify, pandora or any other streaming service. So yes, I’m pretty behind on what’s happening with Stranger Things and Keeping Up with the Kardashians, but I’m also saving a lot of money. I’m not suggesting to be like me and go cold turkey, but I do suggest only keeping your favorites and canceling the other subscriptions. Suddenly you will feel like you are making more money because it’s not being withdrawn from your account every month.
9. Track your expenses. Some people use apps, others make an excel chart. Either way, when you keep track of how much you’re spending monthly on rent, utilities, car payments and recreational things you really get to see how much you are spending. When you can physically see your monthly spendings, this can help you determine if you need to cut back and where, or if you’re right on track and could even spend a little more.
10. A dollar a day. I learned this from my dad. Every day he puts $1 in an envelope, so by the end of the year, he has $365 saved. By the end of 2 years, he has $730. He doesn’t spend any of it, it just keeps adding up. Then once you have a substantial amount, you can decide what you want to do with it (go on a trip, buy that ‘thing’ you always wanted, save it??) and then start all over again. It’s a simple way of saving and then having some nice spending money as a reward for saving and having patience :)
Which tip did you find most helpful, and would you add any?
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