Being a millennial is hard. There are so many unrealistic expectations and difficulties we face, yet somehow we still keep going as if we don’t feel the world clouding our minds. Self-actualization is so important, yet so many people don’t know how to achieve it, especially when it comes to setting a budget for yourself to ensure you can still spend money, but save it as well.
Here are a few tips on how to organize your finances in a manageable way.
1. Stop Living With the “Now” Mentality
Millennials tend to want to enjoy their current situations and gain life experience. When we want to travel or get a new product, we do it immediately. Because we don’t usually plan to do things far in advance, we don’t know how much we are spending or budget that cost the future. When planning to make a large purchase, plan it further in advanced and actually become cost conscientious. That way there will be no more surprises when you find money leaving your bank account quickly.
Stop Drinking Starbucks Every Day
Say you have one fancy Starbucks drink for five days a week and each drink costs $6.00 (approx.), you’d be spending $1,566 (approx.) a year just on Starbucks coffee! Obviously the drink you pick varies the cost. But still, do you really want to spend that much money on coffee when you can make it at home or get it at a cheaper price. Save the specialty Starbucks for a special occasion when you want to treat yourself.
3. Control Your Alcohol Consumption Habits
Avocado toast breakfasts, specialty coffees and your dinner don’t cost you as much as drinking alcohol when out in public. The average drink is anywhere from $8-$16. So imagine spending that every time you go to dinner with friends or to a club with friends more than once a month, and have multiple drinks. Try limiting the events you drink at, or start buying from the store and pre-drinking if you absolutely want (or have) to drink.
4. Pick Where You Rent Wisely
I understand that you want to be in a desirable city such as New York or Chicago, but they rank on top of most expensive places to live. If you still want to live that Instagrammable city life, move to a small place outside of those cities and commute in. You’ll save more money on rent and can get some good deals on commuting fees on public transit or Uber. Or, if you just can’t live outside of the city, make sure your rent will be 30% of your yearly income to ensure you can live comfortably and not be killed by taxes.
5. Learn What is Priority With Additional Money You Can Use to Spend
Lets say after rent you have $1,200.00 left from your monthly income. That’s approximately $40 a day, multiply that by 7 and it’s approximately $280 a week. On average you should spend at least $80 a month on groceries. That leaves you with only $200 left for other things such as commuting money or other fun activities you enjoy. If you only have room for a few fun activities a month, learn which are must-do’s. If you need to spend $30 a month to get your nails done, set that $30 aside as a “necessity”. And if that’s too much money, start looking at other expenses such as food or clothing that need to be limited.
Unfortunately having fun just doesn’t pay the bills and if we want to ensure we can splurge on a girls trip or have money for a rainy day, we really need to start budgeting better. It’ll be an adjustment at first, but once you know your residential and normal life finances are already paid for, it’s time to enjoy yourself.
Featured image via Unsplash