BreakingModern — The early years following graduation can be a tricky time. You aren’t yet established in your career but the bills are rolling in anyway. On top of paying rent, utilities and other living expenses, you may also have college loans. All of this combined usually means you have more money going out than coming in.
Even if you feel you don’t have a dime to spare after you’ve paid your bills, you may be surprised to learn you can still find a way to save a little money each month. The first step toward managing your finances is to learn as much as possible about where your money is going. Whether you use software to manage your budget or you do it the old-fashioned way, here’s a guide to help you better manage your finances.
Whatever your total monthly income currently is, you likely wish it were higher. Tally your monthly take-home pay, as well as any other money you receive on a recurring basis. If you find it isn’t enough to pay the bills, you may need to consider getting a second job. You can offer to housesit for a neighbor, babysit for a friend or even sign up to work for a crowdsourcing service like Uber, Instacart or TaskRabbit to make extra money. As part-time jobs go, pizza delivery and waiting tables pay fairly well. You can also get creative and start your own side business out of your apartment. If funds get really tight, there are even more creative ways to make money, like donating plasma or selling items on Craigslist.
This is where you really begin to learn where your money is going each month. Start with required expenses like rent, utilities and insurance, since these don’t usually fluctuate from month to month. Note how much of your income is left over after those required expenses. That money will have to go toward all of the other things you need on a day-to-day basis.
Your grocery budget should be set next, followed by items like the basic clothing you’ll need for work. By setting a weekly food budget, you’ll likely decide to buy less expensive grocery items and make them stretch. To squeeze more money out of your monthly income, you may decide to live at home or share an apartment with a roommate until you can gain the work experience you need to earn a higher salary.
When finances are tight, the idea of setting money aside for a rainy day may seem preposterous. But actually, it’s the perfect time. Even if you can only set aside $15 a week, doing so means you’ll have $780 at the end of the year. Once you have $1,000, you’ll have a small emergency fund available to help with life’s unexpected events. And this will keep you from relying on borrowed funds.
By setting a monthly budget, you’ll put yourself in charge of your finances, which is an important first step toward a strong financial future. Templates are available in Google Docs and Microsoft Office to help get you started.
For BMod, I’m Stephanie Faris.
First Image Credit: © BlueSkyImages / Dollar Photo Club
Featured/Second Image Credit: © NOBU / Dollar Photo Club