For the first time in my life, I am financially stressed. I used to think I was, back when I lived at home with my parents (rent and utility free) and worked as a server that paid me about $800/month. I would worry and over-think about buying something that cost $100 or more, and then buy it, and then repeat that about once a week. I liked to buy things that I didn’t need, but wanted oh so bad. And then I went to Michigan State for my undergraduate work. I took out about $20,000 a year for tuition and living expenses, then had a menial little job as an usher at the Wharton Center to pay for gas and…you guessed it, more expensive things (Banana Republic was my favorite place to shop). But, I still believed myself to be under financial stress.
Now, I am a grad student at Michigan Tech. I make $1000/month. $900 is allotted for rent, utilities, credit card bills, phone bill, food, and gas. The other $100 goes towards paying off other various loans I have accrued. For the first time in my working life, every single dollar is accounted for. I get excited when I can put $25 into my savings account (I have $75 now, woot woot!). The thing that I keep pushing out of my mind is what is going to happen if something major comes up. Like, oh, the new clutch and tires I’ll have to put on my car before winter comes, or say, trips home (which costs $80 round-trip).
While this money stuff worries me to bits, I am glad that I am under this stress. I know that in the long run, it may teach me financial knowledge. It may teach me how to really be frugal and spend wisely. If all of a sudden I were to come across a few extra hundred dollars, I believe I would put it toward my bills rather than adopt a false sense of security and decide to buy some new books. I know that this will all come to fruition in about two years when I graduate, but for right now it is nearly unbearable. I have to winterize my house, which is going to cost money that I don’t have! In addition, winter is coming, which means that heating costs will shoot up, which is going to cost money that I don’t have! I know my roommate would object to keeping the house just above sub-zero temps. I would object to that too. But, I need to figure out something, hopefully before I dig myself into too deep a financial grave. Now, I’m really not complaining about this (really!). I consider it a blessing that I know what it’s like to have to spend consciously, because so few people do it, and only then it’s usually out of necessity rather than desire. I would choose to do it out of desire.
Here’s a list of what I’m doing to budget as wisely as possible:
1. Envelope system- a certain amount is allotted to groceries and entertainment. If I run out of money, I don’t use my card.
2. I buy food staples like brown rice pasta, flour, sugar, and dry beans in bulk. Then I buy a lot of fresh veggies. If I have extra cash, I’ll stock up on a few canned or frozen veggies and beans (I found a great organic/ GMO-free source for frozen veg) to use when I need something quick.
3. I cook from scratch and make meals that last me a few days and are easy to take in to school for lunch- soups and stir fry are great!
4. I’ve started making my own toothpaste. Baking soda, ground salt, and peppermint extract. Not sure how I feel about it yet, but I also don’t like $7 toothpaste!
5. I am going to start paying at least $10 more than the minimum on my credit card statements to try to get a little shaved off on the balance, rather than just paying the interest. Hopefully this will get my bills down a little by the time I am graduated so I can focus on other things.
So far, I’m loving the envelope system. I no longer go to the store and pick up little extras that I don’t really need. It is relieving some anxiety because when I check out, I don’t feel so overwhelmed at the cost because I have cash allotted for everything I purchased. Financial freedom, by use of a budget system, is looking like a stronger stress reducer than I thought it could be.