There are so many things about money I wish I would have known when I was in college. At 20 years old, I was newly married and starting my third year at community college. While my college experience wasn’t “traditional” in the sense, we did have to be resourceful with the money we had and learn how to save money.
1. Avoid debt if possible
Student loan debt is no joke and it feels like it is going to take forever to pay off. When I graduated college, I accepted a teaching job right away and went on an income repayment plan to start repaying my student loans. I started off paying about $275 a month on my loans, which ended up going mostly towards interest. My total balance on my loans wasn’t going to go down unless I started paying more on them each month, which was tricky on a new teacher salary. To avoid taking out student loans, start looking for scholarships and grants when you are still in high school if possible.
2. Apply for scholarships
Scholarships are basically free money to use towards your degree. You can apply for scholarships through websites like Scholarships.com. Also check you colleges website to see if they have a list. Sometimes scholarships from local donors are listed or scholarships for certain programs are available.
3. If loans are unavoidable, only take the minimum amount needed
With things in upheaval around the world, now more than ever you should be preparing and looking ahead to the future. Your goals may be changing, but your drive should remain the same. Check out some of the best way to reach your financial goals!
Define your financial goals
Where do you want to be with your finances? Are you working towards becoming debt-free? Do you want to go on a paid for vacation? Do you want to build your savings?
When setting a goal, make sure it is realistic and specific. Instead of saying I want to pay off debt, be specific and say “I want to pay off my car loan ($8,000) by the end of the year. This will help you break it down to see how much a month you will have to pay on your car to pay it off. For example, you will have to put about $690 on your car each month (depending on your interest rate) to have it completely paid off by the end of the year.
Its best to focus on one goal at a time to prevent stretching your finances too thin and burning out.
Create a budget
This is the plan for how you will reach your goals. Make a list of all of your expenses and compare it to your income. After all of your bills and expenses are paid, how much income do you have left to put towards your goal? If you are over-budget
Since starting our journey to becoming debt-free, we have been looking for ways to cut our budget and save money. Groceries is an area I knew we could cut down on, but I want to make sure we aren’t sacrificing quality for a cheaper price tag. Here are 10 tips to save money at the grocery store that do not involve couponing.
1. Meal Plan
Meal planning takes the guess work out of “what’s for dinner.” My husband and I like to sit down once a week and create a list of dinner’s for the week. By creating a plan for the week you know exactly what needs to be purchased from the grocery store.
2. Create a list
Going grocery shopping without a list is a sure way to overspend. As you are meal planning, write down the things you need and when your at the grocery store, stick to your list!
My husband and I started our debt-free journey about 2 years ago right after we had our son. We have the goal of paying off all of our debt and setting up a better future for our family. We were able to take Dave Ramsey’s Financial Peace through our church. These are 8 things we learned about money by taking the course.
Save a $1000 emergency fund. Unexpected expenses will come up, do you have cash to cover the next emergency that pops up?
Pay off debt using the snowball method. List out your debts and start paying extra on the smallest debt, while only paying the minimum on the others. The goal is that you will pay off those smaller debts fast, then you can “snowball” the extra money to go towards the next smallest debt. By the time you get to your larger debts, you should have a nice sized snowball to knock those loans out.
Live within your means and forget “keeping up with the Joneses.” The Joneses are the neighbors who have the nicest lawn and the newest cars and gadgets. The truth is, they are also broke. Keeping up with the Joneses will not fulfill you and will only cause setbacks with your debt-free journey.
Have slush funds for the things you are saving for. A slush fund is a separate savings account for specific things. For example, we have a slush fund for the car insurance we pay every six months. Each month, I set $120 in our slush fund so that when our car insurance is due, we will have enough to pay it in full.
After all debt (except mortgage) is paid, build a 3-6 month emergency fund. This would be your “fully funded” emergency fund to cover large unexpected expenses or to cover job loss.
Contribute 15% of your pay to retirement once debt is paid off. Dave recommends temporarily stopping contributions to you retirement while you are paying off debt to focus all extra income to pay off debt quicker. The thought is that the quicker you can pay debt off, the sooner you can start contributing more to your retirement.
Have a budget meeting each month. If you are married your budget meeting should be with your spouse to list out all of the income and expenses for the month. Think about any extra expenses you will need to cover such as birthdays, school functions, etc. “Give each dollar a name” so you know exactly where your money is going.
We have been following Dave Ramsey for about a year and a half to budget and pay off debt. We made the decision right after we had our first baby to pay off all of our consumer debt to set up a better future for our family. We hope to be able to eventually buy a home that is a little bit bigger than our current home and take our family on a vacation. Being debt free will hopefully also allow us to adopt a child, which is a dream of ours, but unfortunately so expensive.
The first piece of beginning a debt-free journey is to create a budget and stick to it- which is the hardest part in my opinion. Even if you aren’t following a plan to become debt-free, following a budget is beneficial to be in control of your money and to know where your money is going.
1. List all of the income you expect for the entire month.
Add all of your income together to have an income total for the month. If you have an irregular monthly income, estimate how much you make per month and you should set up a budget using your lowest monthly income estimate. Have a plan for any extra income you may make within the month (ex: put any extra in savings, or apply extra to a loan.)