Lifestyle

“Money is a Good Servant, But a Bad Master”

DISCLOSURE: I’m no money management expert, this is just what I did to stop being so damn BROKE.

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We’re only 9 days into the New Year so this is the perfect time to talk about finances and managing money. For those who didn’t have someone to educate them on handling money and spending responsibly it can be pretty tough to go from swiping and spending to stacking and saving. I know because I struggled with it myself.

A little back story, so I didn’t begin working a real job until I was in college at the dining hall. I was making just enough to pay my phone bill, keep my nails & hair done, occasionally go out to eat (I’m working in the dining hall so my meals are free) and fund my newly formed makeup addiction. At this point I’m living paycheck to paycheck, but I don’t have any real responsibilities so I’m not pressing the issue. I go home at the end of Spring Semester and because my job ends when the semester ends, I’m broke as hell and my mom is paying my phone bill. Maybe a month later I get a job at some restaurant near my moms job that I walked to every morning. I’m working 40+ hour weeks making okay money, still living paycheck to paycheck. I upgrade my life and get an “adult job” where I’m bringing in the most money I’ve ever made, literally quadruple what I was making at the restaurant, and I’m still living paycheck to paycheck. Do y’all see a pattern here?

I could go on and on about the different jobs I had and how I continued to live paycheck to paycheck until around August 2016, but thats not what’s important. Let’s talk about what is: how I stopped being broke.
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It’s easy to get caught up in the habits of daily spending, a coffee here, a pair of shoes there and it’s up to you to stop it. My first tip is to cut out EVERYTHING that is unnecessary. No more Starbucks, or in my case Chick-fil-a (have you tried the frosted coffee???), no more clothes or shoes unless absolutely mandatory, no purses, no fast food, no bottled water (my fridge has a filtration system + you’ll be eco-friendly af). Things you know you can live without, have to go.

Tip 2. Budget out and make note of everything that you HAVE to pay, car insurance, phone bill, student loans, utilities, rent (which should only be 30% of your monthly income), gas, etc. You know you have to have to pay these so why not already have a rough calculation of what you know you’re going to spend.

Tip 3. Follow the 50/20/30 Rule. This financial rule basically allocates 50% of your income to essentials, 20% to your savings (and debts) and 30% for personal use, or “expenses that enhance your lifestyle”. I apply this rule to all the money I get regardless if its a paycheck or a gift.

Tip 4. Don’t be afraid to ask for help. And no, I’m not talking about asking people for money, I mean professional help. Start at your bank, the people who sit in those offices aren’t just there to sign you up for a bankcard. They can offer you crucial advice on not only managing your money, but also how to get a credit card, or steps you should to take to get approved for a car or home loan. Some banks even offer help on how to reconsolidate your debt.

Tip 5. Set savings goals. This will prevent you from making a purchase you can’t afford. I’d much rather save up for a big purchase than swiping for it and putting a huge dent in my checking account. A rule I follow is: “if you can’t buy it twice you can’t afford it,” so put the Gucci purse down.

 

 

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