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MMI1990's avatar

Graduating college next year and horrified of expensive living. Help me gain perspective?

Asked by MMI1990 (7points) August 25th, 2009

I’ll be graduating into a field that typically makes a starting salary of 28–32k. Is this enough to live a somewhat comfortable lifestyle in a moderately expensive city? I plan on doing everything I can to lessen my expenses – I don’t buy fancy new gadgets, I don’t mind sharing a house/apartment with multiple people, etc. But still, I want to be able to eat out, drink at bars, and see movies every once in a while – not every night, of course. But a few times a week.

However it seems like after taxes, rent, health care, car insurance, phone bills, internet bills, transportation costs (gas/public transit), and (attempting) savings – I’ll have very, very, VERY little money left over from each paycheck. I’m fortunate to not be in debt or have student loans.

My question is – how do you do it? Any tips? Has anyone pulled this off and still lived comfortably?

Bonus question – Any expenses I’m forgetting? I’m not as accustomed to this whole “real life” concept yet…

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17 Answers

MrGV's avatar

There is no way you would live a 100% comfortable life completely on your own with 28–32k a year. You will be able to still have a social life here and there, but there will be times when you will hit a bump. BEST thing to do is continue going to school and maybe a better job will come up from it.

EmpressPixie's avatar

It depends entirely on where you end up living.

If you are in a big city, see if you can forgo private transportation entirely. This will cut down on your expenses massively. No gas, no insurance, no parking permits or tickets. Your employer will probably help with or provide insurance. Or provide options for it.

If you have roommates, internet, electric, gas, and water will be split among you all. This will greatly decrease your cost. Have frank conversations with your roommates regularly about appropriate temperatures though—you should all agree on winter and summer temperatures.

Frankly, it depends entirely on your style of living. A good friend of mine lives in Chicago very comfortably on the pay scale you are describing. He has apartment mates that drop the rent, has no car (public transit ONLY), shares bills, and has carefully selected extravagances (a nice phone, eating out, organic food, etc.). The key is figuring out what you can afford and sticking to it.

sneuron's avatar

A big part of it is, what city? And if you have no flexibility in that, what area? Your rent is an extremely variable aspect of your budget, but once set, usually can’t change quickly (if you are on a lease). Sharing housing, and living in less expensive areas is a very good way to cut cost of living form the start. Keep utilities in mind when picking a place. Some where with utilities included could save you a lot of money, especially in very hot or cold climates.

The next big variable is transportation. Having a car is great, but will take up a lot of money. Can you get around using just foot, bike and public transit? Is there a car sharing program (like zipcar) that you could use when you needed to, and save money over having to pay insurance, upkeep, etc? This could take a huge strain off your budget, and help you get regular exercise (w/o a costly gym), but you will lose some freedom of movement.

Finally, food will be a factor. Cooking most of your meals, and only spending money at restaurant when going out with friends or on special occasions will save you cash for when you need it. Skipping the coffee shop in the morning and the take out at lunch for your own brown bag lunch can keep your food budget down enough to let you enjoy the periodic dinner and happy hour with friends.

Bottom line is that there will be choices to be made. Good luck.

EDIT: yeah, what pixie said. Maybe I shouldn’t type so slow.

dpworkin's avatar

The most effective thing you can do to foster a better living situation is to get an advanced degree in a subject the students of which are in demand.

The_Compassionate_Heretic's avatar

Make a budget and stick to it. The first years out of college are hard so you’ll have to live lean for a while. That drives you to take the next step in your work.

PandoraBoxx's avatar

The biggest pitfall is spending more money amusing yourself than you should. Cable, eating lunch out every day, and going out to the bars can eat through $500 – $1000 a month without realizing it. If you start out thinking that those are necessities of “adult life” you have every reason to be horrified.

Make a budget and stick to it. Keep in mind that the lifestyle you knew at your parent’s home is the result of them being in the workforce for 20 years. You will not be able to replicate the lifestyle you had at home when you are just starting out on your own.

Make a budget and stick to it. Get in the savings habit right from the start. It’s more important to save than to go out to the bars.

dee1313's avatar

Crunch numbers!!! That’s what I call it, because I was never formally trained on how to make a budget.

I just start with income (if it varies, underestimate it).
Then take away money for bills (I often round up to the nearest dollar)
Then money for gas and groceries.

Those are pretty much your necessities. Try to put as much as you can of what is left over in a savings, even $10 or $20 bucks will help (you need to have an emergency fund so you won’t be screwed if one actually happens). Make sure you start putting a percentage of your money into retirement.

I say that after that is all done, fun stuff should be included, but keep in mind what is important. Blowing money on beers at a bar, or saving up for a new tv?

If you don’t have enough money for the bills, gas, groceries, and a bit for savings, you need to cut your bills down or lower your groceries bill. Cable is a no-no (you can watch tv online). If you are paying a lot for a spiffy cell phone plan, cut that down, or see if a prepaid phone is right for you. If you have both a home phone and a cell phone, get rid of one. If you still have no more money, cut the internet and go to the library to use it free.

Still broke? Shop around for car insurance. Its a pain, but you might end up saving a ton. There are a lot of companies that will match or beat prices. I just called Comcast and they temporarily lowered my bill.

I have our accounts structured like this:
Primary checking (one to use everyday)
Bills checking (when you get paid, put the money you will use for bills here)
Have-to Savings (for things like vet bills, or car repairs, and your emergency fund)
Fun Savings (this is where I save money for a PS3, plane tickets to visit family, etc)

(I’m so sorry this is so long.)

I think the big part about having a good budget is including everything. Even the $3 birthday card for your mom. I can send you my budget if you’d like, or just list a bunch of things to add to yours.

Just remember, no matter how good your budget is, if you don’t stick to it, its useless. I think the hardest place to stick to a budget is at the grocery store, so I bring a calculator. I have a list of about how much everything costs at home, so I can estimate how much my trip will be before I leave. Its best to split the grocery money up by week, so you only go shopping for a week’s worth of food, and you don’t have to worry about not having any more money for more food at the end of the pay period.

galileogirl's avatar

You are going to take home $2000/mo and pay $1000–1200 for a 300 sf studio. In SF that is half a converted garage, a 5’ by 5’ bathroom. The kitchen is a microwave, 2 burner stove top and a mini fridge. You get cement floors. a couple of tiny windows and one end of the room is curtained off for your closet.

You will have to count every penny you spend and you still will always be short.

How on earth do you get a degree (omg-college loans) and you earn 17 yo retail clerk base pay?

perplexism's avatar

Where you live is the single biggest factor in whether you will be able to live comfortable off your salary. For instance, where I live – which is some place in the southern U.S – you’d be able to live quite comfortable off that, because I know some people who make less than what you mentioned and they still are able to (granted they are single, don’t have kids, or excessive debt). But then again, the cost of living is less here than say NYC, Chicago, and SF.

If you want big city living, you’re going to have to be prepared give up a lot. Stuff like having you’re own car, going out less, and possibly doing a roommate situation for a while with that salary you mentioned.

Hopefully you live in a place that has public transportation. I think sometimes people underestimate how much they can save if they just do public transportation – provided, of course, you live in a place that has top-notch public transportation.

EmpressPixie's avatar

@galileogirl: That is also entry-level position base pay. Many professions start you there. In theory, your pay scale goes up faster, but in reality it depends entirely on your profession.

PandoraBoxx's avatar

The other thing I should add is that although you are graduating into a field that typically starts at 28–32K, if you don’t already have a job lined up, be financially prepared for a job search to take you 6 months to a year. The employment rate is exceedingly high, and for many positions, it’s tougher to find a position than normal. People are not leaving positions at the rate they normally would, and you may find yourself competing experienced people for entry level positions.

Start being frugal with your money now, don’t wait until graduation to look for a job, and work out a contingency plan with your parents for living at home for awhile you look for work.

saraaaaaa's avatar

I gradauted a month ago and am in a dire situation money wise. It turns out that the media industry is difficult to start off in, with a thousand other people trained to replace you if you do not meet very high standards who knew.
At the minute I have to be prepared that some socialising is going to have to be missed, the job i currently do earns me 7k a year in England and so the most valuable lesson I have learned is learning to say no. Hard but the only way to get out of it.

ubersiren's avatar

I would say 28k would be cake. I lived in Baltimore on 15k. I’m not sure how your city compares to the cost of living here, but just budget, budget, budget. Settle for a modest apartment, and try to find a roommate. Get one of those bonus cards for the grocery store and only buy food which is on sale. Make your own food as much as possible, rather than ordering pizza. Don’t have both a cell phone and a land line. You don’t need the internet at all if you have a laptop. Go to a Panera Bread to check your email. It’s a pain in the ass, but if you can get away with not having internet, it’s worth the money you save.

You can still go out, but only do it as much as you can afford. If you can afford it once a week, do that. If it’s only once a month, stick to that. See if your friends would like to come over for a game of RISK, or a movie or whatever you do. There is fun to be had without spending much money.

LuckyGuy's avatar

Don’t forget medical expenses/insurance. That can eat up more than you think. I know… you are healthy and immortal but without insurance you are one trip to the emergency from away from financial disaster.

srtlhill's avatar

You’re ahead of the game by being aware of your coming living expense. Start saving now and treat yourself when you feel you can. If you’ve worked extra hard reward yourself just don’t over do it. Life is full of challenges every day don’t let the stress of bills get you down. Keep working hard and you will get ahead of the game. Don’t fall into the trap of living pay check to pay check. You might have to sacrifice a little to get ahead alot.

ubersiren's avatar

@srtlhill : GA. Not many people just starting out on their own even consider trying to work on a budget. @MMI1990 must have a good head on his/her shoulders.

JLeslie's avatar

Depends what city you are going to be living in. Most areas of the country you can live fine, especially if you live with a roomate. My advice would be don’t get into debt, and don’t put pressure on yourself to be all set up in your life like an adult who is 40. My observation lately has been that young people just out of school want to live like their parents, but probably their parents started out in a little apartment with a small car, etc.

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