Living on my own for the first time

[on my own]

I'm living on my own for the first time and I don't have much money experience. I don't have any debt, but I also don't have much savings. I'm excited to be on my own, but I'm also a bit scared and I don't want to make any huge money mistakes.

What advice would you give to me or anyone else that is just starting out and living by himself for the first time?

[Dsquared513]

1. Write out your budget and track your expenses.

2. Figure out simple meals you can make for cheap and eat the leftovers for lunch. Fast food and restaurants are expensive and should be considered a luxury.

3. Save important documents, ie. tax returns, paycheck stubs, receipts, bills, etc.

4. Get renter's insurance, it's cheaper if you can bundle it with an existing auto policy.

5. Don't buy stupid crap to clutter up your new place. You don't need a robotic fish tank with laser lights or an electronic pasta maker or 2 dozen frilly throw pillows. Having a new place with lots of room for new stuff can lead to impulse purchases, resist the urge and bargain hunt for actually useful items at flea markets, online, yard sales, or discount stores.

[breathemusic]

I just want to stress #1 on Dsquared's list. Budget, budget, budget, track, track, track! The way people get into debt and in over their heads in the first place is by not paying attention to what they're spending. You can pretty easily make a spreadsheet that you can use to track your income vs your expenses. You can enter in your known, fixed expenses like rent, phone bill, insurance, etc. And then put in estimates for the things that fluctuate like utilities, groceries, etc. But as soon as the bills come in, replace the estimate with the actual. Keep tabs on what you spend on groceries and you can get an idea if you're spending too much or being reasonable.

Also, don't forget to plan for bills that only come every so often. Car registration/inspections. Maybe you only pay your insurance quarterly, or every 6 months. And even if you have to build it slowly, try to save a little money for emergencies like medical bills, car repairs, etc. You won't know when they will happen, but at some point, unexpected bills WILL happen.

You don't have any debt, so don't stress about it. But at the same time, there's no reason not to plan! Best of luck, and if you really want extra detail, post a list of your income and expenses and the friendly people here would be happy to provide some feedback and recommendations on savings, etc.

[Eagle]

I'm living on my own for the first time and I don't have much money experience. I don't have any debt, but I also don't have much savings. I'm excited to be on my own, but I'm also a bit scared and I don't want to make any huge money mistakes.

What advice would you give to me or anyone else that is just starting out and living by himself for the first time?

Make the commitment to spend less than you earn. That means that you are putting some money away towards savings and retirement every time you get paid.

Avoid debt if at all possible. Consider long and hard before you take on any debt. There are a few examples such as education and a home mortgage where debt may in fact be worth it. When you do get a credit card treat it as a debit card. Pay off the entire balance each and every month. If you can’t pay the credit card off that month then don’t make the purchase.

Don't worry about "keeping up with the Jones’s” when it comes to stuff – latest cars, boats, motorcycles, bigger houses, etc. Don’t expect to have everything your first five, ten, or even fifteen years your parents have taken a life-time to accumulate.

Take some time to educate yourself about personal finance. Some good personal finance books:

• The Total Money Makeover By Dave Ramsey
• The Millionaire Next Door By Stanley and Danko
• The Richest Man in Babylon By George Samuel Clason

Consider getting a mentor. If you can find one or two adults whose financial behavior you wish to mimic. Observe them and ask questions of your metor. Perhaps someone at your job, your local church, or a relative.

Shifting gears to long-term what are your goals, objectives, and dreams in life? If you go to college, which I do recommend, what degree would you pursue? How much debt will you have to take on to get the degree in college? What kind of job could you possibly get with said degree? What is the average starting salary for people in said industry in the U.S. and in the state you live in?

If you’re planning on going to a technical school (Dental hygiene, culinary school, paralegal, etc.) l what profession would you be attracted to? How much debt will you have to take on to get the degree at the technical school? What kind of job could you possibly get with said degree? What is the average starting salary for people in said industry in the U.S. and in the state you live in?

If you have entrepreneurial tendencies, consider the possibility of starting a company or being self-employed rather than being an employee of an organization.

If you do get married choose your spouse very carefully. Divorce is horrible on a variety of levels. Financially, it can be devastating towards wealth building..

Set goals for yourself... Make them SMART Specifice, Measurable, Attainable, Realistic, and Time-senstive.


So questions:

What are your interests? What career do you want to pursue?

[Eagle]

1. Write out your budget and track your expenses.

2. Figure out simple meals you can make for cheap and eat the leftovers for lunch. Fast food and restaurants are expensive and should be considered a luxury.

3. Save important documents, ie. tax returns, paycheck stubs, receipts, bills, etc.

4. Get renter's insurance, it's cheaper if you can bundle it with an existing auto policy.

5. Don't buy stupid crap to clutter up your new place. You don't need a robotic fish tank with laser lights or an electronic pasta maker or 2 dozen frilly throw pillows. Having a new place with lots of room for new stuff can lead to impulse purchases, resist the urge and bargain hunt for actually useful items at flea markets, online, yard sales, or discount stores.

This is good advice.

A good qay to track your expenses is www.mint.com

[Eagle]

I'm living on my own for the first time and I don't have much money experience. I don't have any debt, but I also don't have much savings. I'm excited to be on my own, but I'm also a bit scared and I don't want to make any huge money mistakes.

What advice would you give to me or anyone else that is just starting out and living by himself for the first time?

As far as big picture ideas consider this thread on figuring out your life goals and objectives.

[Randomsaver]

Befriend a chef and let him/her teach you to cook in your house. Or, pay the person $50 to cook your favorite dish or 2 from the restaurant.

[odlantern]

Don't worry about "keeping up with the Joness when it comes to stuff latest cars, boats, motorcycles, bigger houses, etc. Dont expect to have everything your first five, ten, or even fifteen years your parents have taken a life-time to accumulate.

I second this. Buying more items and living in a bigger space just means more stuff to deal with, more to clean, harder to move. Live simply. Eating out can be a major expense as well, so learning how to cook well can be both healthy and save a lot of money.

[ua_guy]

1. Budget

This is really, really simple. Sit down, figure out how much money you took in each month (income), and how much money went out (expenses). Track your expenses, and discipline your spending where you need to. Also come up with a savings goal and direct your spending/saving towards larger goals. No elaborate software needed. When I first started, I was doing it on notebook paper and shoving each month's "budget" in a desk drawer to reference the next month.


2. Learn how to cook.

Eating out is needlessly expensive and can be bad for your health. Start learning how to make things you like, start gathering stuff for your kitchen as you discover you need certain items. I did not know how to cook when I first moved out on my own. This is a great thing to do with other people...learn new techniques and new food, share kitchen tools.

3. Don't buy crap.

(Goods OR services). Stick to what you need, buy the best you can afford, don't cheap out on things that will make life miserable. These things you will learn over time. Cheap cookware is a good example...it heats unevenly, handles corrode and fall off. Save for and buy good stuff, or buy good stuff second-hand.

4. Learn to lose your pride

(About certain things). So what if you don't have a smartphone or the expensive cable package or the absolute fastest internet (unless you need it for a job, etc). Your budget is your new master, abide by what it is telling you. There should never be shame in not owning something if you can't afford it.