A full-time college student that I know was evaluating their budget. They called me to see how the should allocate. I gave them the basic run down:
- Pay yourself first for an emergency fund.
- Pay down debt aggressively.
- Do not spend more than what is budgeted.
- Try to live within your means.
This is what we came up with after discussing it back and forth. These are approximations:
Rent Share $225
Car Insurance $69
Cat Expenses $25
Car Payments $205
There was a big tug of war on the issue of recreation and debt. I pointed out once they knock down the debt then they will have more cash to use for spending (just not all of the $100).
I admit it’s weird having a friend/relative call you to ask about budgeting information. I was cut off guard, but I really got interested. I was explaining how money can be used as a tool and if you can delay some expenses when you’re in school (like some road trips, but not all), you can have more choices when you graduate. I gave the “don’t be like me with debt and student loans!” speech which either hits a nerve or scares people.
Have you had friends/relatives talk to you about finances? What piece of advice did or would you offer?
Photo Credit: Joshua Rappeneker