By YOSEF IBITAYO/Staff Writer
When I left my job as a cook in June in preparation for coming here, I started the summer with nearly $6,000 in my bank account, an amount which I had built up and saved over five months by restraining myself from purchasing whatever I wanted.
By August, around the time I needed to pay off my UT Tyler account in order to come back this semester, I had around $3,000. Where did the other $3,000 go, you may be asking? Half went to rent and bills and the other half I used to buy things like a new laptop.
If that little anecdote resonates with you at all, these five tips may be useful.
KEEP TRACK OF YOUR MONEY
While this may have been pressed into your head by your parents or home economics teacher in high school, it bears repeating: the first and best thing you can do when it comes to money is to keep an eye on it.
Small purchases, like a meal from Chick-fil-A or a pack of pencils, can add up rapidly if you’re not cognizant of your cash.
If you have a job, think of your expenses in terms of hours and minutes rather than dollars and cents. Ideally, you can come up with some initial sort of structure for your budget that fits your particular situation at the moment, but a good baseline to keep in mind would be-
THE “50-30-20” RULE
Created by Sen. Elizabeth Warren when she was a professor at Harvard University and published in her 2006 book “All Your Worth: The Ultimate Lifetime Money Plan,” the 50-30-20 rule is a guideline to structure your budget around three categories: needs, wants, and savings.
As a rule of thumb, 50% of your net income should go toward mandatory expenses, like rent, utility bills, groceries, and transportation.
The remaining half is split 30/20, with 30% going to things you want, like entertainment, eating out, or shopping, and 20% into savings.
Some of the 20% can be used to pay bills or expenses, like student loans. However, as the “rule” is more of a flexible goal, your plan should be to-
LIVE AT OUR BELOW YOUR MEANS
The majority of the 50% you spend on needs is unlikely to change due to the rigidity of most expenses. However, there are some expenses you can adjust or do without.
Instead of ordering takeout or buying pre-made products from grocery store shelves, you can cook meals and store them. Websites like Budget Bytes or Frugal Nutrition can help you keep track of both your caloric intake and economic output.
Buy things in bundles. Whether it’s subscriptions like the Disney Bundle or websites like Humble Bundle, Fanatical, or Bookwarehouse.shop, you can find things you may want for as low as 10% of their original price.
Also keep in mind that some companies offer discounts to repeat customers if they-
AUTOMATE PAYMENTS
This tip is rather tricky. You should be very careful when it comes to automating monthly payments.
If you suddenly fall on hard times, whether losing your job or facing an unexpected and large expense, you’ll be able to mitigate further loss of now-stagnant assets by canceling whatever auto-paying setups you’ve got running.
However, one thing you should not stop doing is working to pay yourself
PAY YOURSELF
If you’re a fan of TV shows or movies about crime or the police, then you’ll probably have heard of the term “skimming off the top.. This tip is essentially that.
Every time you can, take a little bit more than your usual percentage reserved for savings and put it into your pocket. Even if you pay for everything with a card or your phone, it is good to have pocket change stashed away if you ever need a quick payment.
Alternatively, you can look into online investing websites and apps, like Robinhood or M1 Finance, to have your money “work” for you through the ups and downs of the stock market.
Hopefully, you can put some (or all) of these tips to use in your life. Keep an eye on the investment angle, however. There’s more to be said about that.
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