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In which I am crass and discuss money
It was brought to my attention that I do not especially know how to budget1.
That's mostly okay, in that I've been a dumb privileged white kid for the last bunch of years, and one of the infinite advantages of having parents willing to pay for college is that they pay for room and board too. Budgeting for me has exclusively thus far been "do I have enough money for that event I want to go to" and I can more or less afford that on babysitting.
But I'm going to join the real world somewhere in the next 3-6 months, and not only do I not have a great grasp on how much the world is going to cost, I don't think I have a particularly good grasp on what I'm going to be spending that money on. A friend mentioned that he was paying about a thousand a month, for everything except rent and utilities, and I certainly *think* I can keep my expenses under that number2, but I don't know if I'm managing to account for everything I'll need to spend money on.
So that's what I'm really asking for: What things am I going to be spending money on that I don't necessarily realize I'll spend money on?
Sitting down and thinking about it, I know there's:
*Rent and utilities
*Groceries/eating out (which is a huge "I have no idea" since I've been living off my meal plan for three and a half years --I imagine I should be able to keep myself fed grocery-wise for a hundred a week, I think that's about what I've spent on the (very few) times when I've had to fend for myself.)
*Dance, which is non-negotiable. If I can afford it in September, I should _absolutely_ get a season pass for SCD, which changes the shape of how much dance costs per month.
(as an aside, that's one of the things I'm finding complicated about trying to write a budget for myself, in that "monthly expenses" is easier than dividing "expenses per semester" by three, or trying to work out how much a year-pass would cost and when I would need that money and such.)
*Transit, which I imagine is hugely variable. If I only ever took the T places, it would be a straight 60/month, but I also have a bike to repair and a future zipcar membership, and taxis and stuff. But on the flip side, if the bike is in good shape, and the weather is nice, I can spend maybe like fifteen dollars on the T and spend the rest of my necessary transit time riding my bike.
*Laundry, which becomes more important as I have to wear more professional clothing, since I don't have enough of said clothing, and therefore have to do laundry more often.
*Also, buying more clothing of the professional sort. I mean, I rock the thrift-store chic so hard, so I'd like to hope I wouldn't be spending too terribly much on this, but it's still a thing.
*Meds
*Other hospitaly/medical things, knock on wood. I don't think this counts as a monthly budget thing, so much as a "I should try to set aside a couple hundred(thousand?) dollars as soon as possible to be my "oh shit oh shit I just broke my leg" fund3.
And...what else? The last time I did anything like this it was in my seventh grade home ec class, where I think I was "renting" an apartment for 50 dollars a month, so it's not like I was exactly being taught accurate numbers for the real world so much as "here's how to balance your monies!"
The real world is hard, whine whine. But dammit, if I'm going to be an adult4, I might as well do it right, and not have to rely on other adults (read: my parents) for taking care of me.
Just rely on them for advice.
~Sor
MOOP!
1: I have gotten as far as "If there is money in my account I can buy things, if there is not, I can't" and seem to do okay with that, but, uh, yeah.
2: More importantly, doing some googling and finding out how much I will make as a teacher implies that (assuming I get a job), I should be making at least 24k a year, which gives me enough for rent/utilities and "everything else". Assuming that my combined rent+utilities is in the thousand dollars or less range, which I think is an okay guess considering the places I've been looking at with Ria and Lauren and Mason.
3: Although, assuming I broke my leg, I could just transfer my dance fund to medical. Gods forbid.
4: I think I've decided that I don't want to be an adult because adults are ridiculously dramatic, often uncommunicative, and generally immature. I'd like to be mature instead. It seems much easier.
Postscript: And yes, I am writing actual numbers for these in another file, in a "trying to inflate everything so I wind up with too much money rather than too little" sort of way. But I figured that would be too gauche even for me to post.
And not in the file yet, because I don't know what the shape of my life will be like yet, is the concept of long-distance travel in order to spend time with faraway friends and SOs. Which could be eighty dollars a month for train tickets, or 500plus for a cross-country plane ride. Plane tickets are definitely my most expensive regular expense.
Also not in the file is the general thought of "here are things I want" and taking steps to buy those things. One of the reasons I want to have some discretionary income is so that I can start scouting sales for expensive things I want/need, so that when they show up for a decent price, I can get them without stressing that I've just wrecked my budget for the month. See also, the fact that I think I want 3 TB of external storage --one for joba, one for backup, and one for media.
a: If everything stayed the same, I don't think I would _ever_ fill a TB of stuff just of assignments and resources and grades and worksheets and lessons and everything teaching will require. But things keep taking up more and more space, and inevitably I'll be teaching Skype lessons with an uberboard or something, and each lesson will be a gig and a half or something.
That's mostly okay, in that I've been a dumb privileged white kid for the last bunch of years, and one of the infinite advantages of having parents willing to pay for college is that they pay for room and board too. Budgeting for me has exclusively thus far been "do I have enough money for that event I want to go to" and I can more or less afford that on babysitting.
But I'm going to join the real world somewhere in the next 3-6 months, and not only do I not have a great grasp on how much the world is going to cost, I don't think I have a particularly good grasp on what I'm going to be spending that money on. A friend mentioned that he was paying about a thousand a month, for everything except rent and utilities, and I certainly *think* I can keep my expenses under that number2, but I don't know if I'm managing to account for everything I'll need to spend money on.
So that's what I'm really asking for: What things am I going to be spending money on that I don't necessarily realize I'll spend money on?
Sitting down and thinking about it, I know there's:
*Rent and utilities
*Groceries/eating out (which is a huge "I have no idea" since I've been living off my meal plan for three and a half years --I imagine I should be able to keep myself fed grocery-wise for a hundred a week, I think that's about what I've spent on the (very few) times when I've had to fend for myself.)
*Dance, which is non-negotiable. If I can afford it in September, I should _absolutely_ get a season pass for SCD, which changes the shape of how much dance costs per month.
(as an aside, that's one of the things I'm finding complicated about trying to write a budget for myself, in that "monthly expenses" is easier than dividing "expenses per semester" by three, or trying to work out how much a year-pass would cost and when I would need that money and such.)
*Transit, which I imagine is hugely variable. If I only ever took the T places, it would be a straight 60/month, but I also have a bike to repair and a future zipcar membership, and taxis and stuff. But on the flip side, if the bike is in good shape, and the weather is nice, I can spend maybe like fifteen dollars on the T and spend the rest of my necessary transit time riding my bike.
*Laundry, which becomes more important as I have to wear more professional clothing, since I don't have enough of said clothing, and therefore have to do laundry more often.
*Also, buying more clothing of the professional sort. I mean, I rock the thrift-store chic so hard, so I'd like to hope I wouldn't be spending too terribly much on this, but it's still a thing.
*Meds
*Other hospitaly/medical things, knock on wood. I don't think this counts as a monthly budget thing, so much as a "I should try to set aside a couple hundred(thousand?) dollars as soon as possible to be my "oh shit oh shit I just broke my leg" fund3.
And...what else? The last time I did anything like this it was in my seventh grade home ec class, where I think I was "renting" an apartment for 50 dollars a month, so it's not like I was exactly being taught accurate numbers for the real world so much as "here's how to balance your monies!"
The real world is hard, whine whine. But dammit, if I'm going to be an adult4, I might as well do it right, and not have to rely on other adults (read: my parents) for taking care of me.
Just rely on them for advice.
~Sor
MOOP!
1: I have gotten as far as "If there is money in my account I can buy things, if there is not, I can't" and seem to do okay with that, but, uh, yeah.
2: More importantly, doing some googling and finding out how much I will make as a teacher implies that (assuming I get a job), I should be making at least 24k a year, which gives me enough for rent/utilities and "everything else". Assuming that my combined rent+utilities is in the thousand dollars or less range, which I think is an okay guess considering the places I've been looking at with Ria and Lauren and Mason.
3: Although, assuming I broke my leg, I could just transfer my dance fund to medical. Gods forbid.
4: I think I've decided that I don't want to be an adult because adults are ridiculously dramatic, often uncommunicative, and generally immature. I'd like to be mature instead. It seems much easier.
Postscript: And yes, I am writing actual numbers for these in another file, in a "trying to inflate everything so I wind up with too much money rather than too little" sort of way. But I figured that would be too gauche even for me to post.
And not in the file yet, because I don't know what the shape of my life will be like yet, is the concept of long-distance travel in order to spend time with faraway friends and SOs. Which could be eighty dollars a month for train tickets, or 500plus for a cross-country plane ride. Plane tickets are definitely my most expensive regular expense.
Also not in the file is the general thought of "here are things I want" and taking steps to buy those things. One of the reasons I want to have some discretionary income is so that I can start scouting sales for expensive things I want/need, so that when they show up for a decent price, I can get them without stressing that I've just wrecked my budget for the month. See also, the fact that I think I want 3 TB of external storage --one for joba, one for backup, and one for media.
a: If everything stayed the same, I don't think I would _ever_ fill a TB of stuff just of assignments and resources and grades and worksheets and lessons and everything teaching will require. But things keep taking up more and more space, and inevitably I'll be teaching Skype lessons with an uberboard or something, and each lesson will be a gig and a half or something.
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I do need to get a credit card, yes. Recommendation for before/after I get out of college? Any thoughts on getting ricockulous airline miles credit cards (my gut feeling is that they are all scams) or other rewardy things? Or is this totally just an "ask mom" situation.
Over small (within Boston) distances, the T is cheaper than driving. Subway is (usually) faster, bus is (usually) slower, but I think the times are close to comparable. Depending on time of day and where I'm going to, bike is often faster than T, and can be faster than cars.
Larger distances result in the pros/cons analysis of owning a car. For at least the next three or four years, my preference is to not, if that's at all possible. If I stay in Boston, I think it might be --swap gas money for rides when I need to get out of town, use ZipCar when I need to borrow a pick-up, and commute to work via bike or T. I'm not sure how much monthly car insurance is, but if it's more than a few hundred dollars, I'm pretty sure it's more expensive than public transit and networking.
I don't want to totally remove the idea of my bike from monthly expenses, at least partly so maybe I can save some money and not be totally doomed when something breaks (like happened recently). But right that it's more of an initial expenditure (tools, tyres, etc) than a reoccurring thing.
The idea of saving up for a new computer every half-decade or so actually sounds really reasonable. I do know I want to get something more modern than Vera sometime in the next year, though I'm torn between going for a desktop and continuing to use Ver' as my out-and-about computer, or a netbook, and leaving her at home most of the time. I know TB are getting cheap --really, it's just where I need to have the spare 50 bucks so that when I see the sale, I can jump on it without worrying.
A thousand sounds like a good emergency fund. I like your concept of making it harder to access, though I worry about getting tied up in something where I have to pay immediately and can't access it. I don't know how plausible that situation is though.
Spend as little as possible and save as much as I can sounds like a pretty damn good plan. I'll see how well I can do that.
And yeah, I'd love the full e-mail, if you want to write it. I always like receiving such things from people!
~Sor
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I've had a Chase Freedom card since I turned 18, and it pretty consistently gets rated as a good non-airmiles card. I've never had any problems, and 1% back on everything plus quarterly bonus promos is pretty good I think. It's an old post, but this (http://www.getrichslowly.org/blog/2008/09/09/credit-card-basics-how-to-choose-a-credit-card/comment-page-2/) has good card-choosing ideas. (In fact I recommend GRS in general, it's the only personal finance blog I follow.) The trick to rewards cards is that you have to pay them off completely every month; interest charges negate any sort of rewards benefits you accrue. You should also find one you like and get it before you graduate, to see if they have any sort of promotion for college students, which are usually pretty good.
By travel I meant long-distance, but yeah. Perhaps find some sort of ride-sharing deal where you drive with somebody else and pay your share, instead of being the car provider. My car insurance (which I understand to be very cheap for a 5-year-old car with an under-25 male driver) is a little over $100 a month. I'd think yours would be somewhat similar, depending on the car obviously, but I don't know. Part of it is that I'm on my family's insurance, which I think is a big benefit, single-person insurance is more expensive.
Basically cars are expensive. It's the sort of thing where a thorough cost-benefit analysis vs. public transport and mooching would be well worth it.
Desktop vs. laptop is mostly a question of use, I think, because you pay a lot (in both money and performance) for portability. The way I use a computer, and the way your mom uses her computer, stationary 95%+ of the time and only occasionally needing portability, for me means desktop plus an old but still functional laptop (plus my iPod, actually). Performance-wise, you use a lot of programs simultaneously, which I think means you could make good use of a desktop, especially with multiple physical screens.
I agree with whoever above said don't put your emergency fund in a CD; that's too difficult to access. Mine is in a plain ING Direct savings account, although it sounds like they're getting sold off soon so I might have to change that recommendation. Having a credit card is part of the emergency system; use credit (or general savings with a debit card) for an immediate emergency, and transfer from the emergency fund to pay it off ASAP. (I use my credit card for nearly everything anyway, so it wouldn't require any thought if I ran into any emergency.)
I'll get that email to you sometime this week. My system and philosophy and whatnot will require some untangling to turn into words.
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DO get a credit card. Establishing good credit is important.
DO put some expenses on the credit card every month, this helps build positive credit.
DO NOT spend anywhere near your credit limit, that hurts your credit rating.
DO pay your credit card bill in full every month. This establishes good credit, and avoids the pitfalls of credit cards. THIS IS EXTREMELY IMPORTANT, because mounting credit card debt can quickly dump you into a hole that's hard to climb out of.
If you can establish enough credit card credit that you're not using on monthly expenses to equal the size of your emergency fund, sock the money away somewhere tough to get at that earns a bit of interest (but no penalty for withdrawal), and plan to use the card to pay for emergencies and pull the money out to pay it back by the end of the billing cycle. If you can't, DO NOT put the money somewhere hard to get at: if it's an emergency, you might well need that money NOW, not in 3 days when you can get it to transfer. Learn to be responsible about not dipping into it for "emergencies" which are really "I want this thing" instead.
Car costs per mile are more than most people think...gas is maybe half the cost, wear-and-tear, insurance, and cost of buying the car in the first place add up to a significant amount. If you're doing the math, include all of those (estimate how much you'll use it over lifetime for purchase cost, and per time-period for insurance...wear-and-tear is pretty much dependent on how much you use it).