I wish a college graduate didn’t have to budget every penny. I wish as soon as I walked across the stage, I was guaranteed a position where I was making six figures. But alas, the real world doesn’t care so much about your education. Employers are looking for one thing: experience. So even though you just spent a ton of money on school to prepare you for that specific job, you won’t get it because you don’t have enough work experience. Instead, you will get some tiny job that barely pays the bills and you will begin kicking yourself for majoring in something like English. I can say this because that’s my major. Shout out to all you English majors out there, we are in this together. So here’s a quick guide to how to budget your money for all you college graduates out there that can’t get a real job yet. Trust me, it’s possible even if you make very, very little.
Calculate your monthly earnings.
Step one, figure out how much money you make a month. Step two, try not to cry. It’s important to take into account days off for holidays and sick days if you are paid hourly. If you are paid a yearly salary, I have one thing to say to you: must be nice.
Calculate your monthly costs.
This includes everything. From rent, to gas, to groceries, to prescriptions, to dog or cat food. Everything that you need should go into this price. No, you don’t need those super cute boots. Put them down and step away from the shoe store. Subtract the monthly necessities amount from your monthly earnings.
Calculate your extra spending money.
Now, you can start to add up the extras. This is the hard part. Because after you see how much money you have left over for “extras,” it’s really not a lot. But there will always be extras in your life. A beer with friends. A birthday present for your dad. A trip to the vet because your dog got a splinter in its paw. (Yes, it happens. And yes, it’s expensive.) Add up what you think you have to spend on extras and subtract it from the already small amount of money you have left over from your monthly necessities. Now, here’s the tricky part: don’t go over this amount! When it comes to extras, they are all fun and games until you max out your credit card and get into even more debt. Practice self-control. Like I said, you don’t need those super cute boots and if they don’t make it to the extras category, then it just wasn’t meant to be.
Calculate your savings.
My dad is so big on saving money. Like so, so big. He is always hounding me about putting 20% away and blah blah blah. I’m all, Dad, I can barely afford rent let alone put 20% of my funds away. Instead, after you have subtracted the monthly and extra costs from your monthly earnings, you will put any leftover money away into savings. I don’t care if you have 40% or 4% of your monthly earnings away into savings. Savings are savings. It’s good to start somewhere.