Financial Makeover: College Students Maria and Caroline
Maria and Caroline are college students who are barely scraping by. Their monthly income is nearly that of their monthly expenses.
It sounds like you’re in a tough place, and I know that can be difficult. There are a few options for you, and right now none of them are terribly appealing, but here they are.
First, discretionary spending is always a vague category and has room for improvement. If you’ll recall from my previous Moneyshot post, I blew through about $1,000 in ‘discretionary spending’ and the vast majority of that was eating out. Did I need to eat out? No. I was already doing groceries too, so I was essentially burning my candle at both ends.
I don’t necessarily think it should be scaled back, but just take a look at how much you’re spending on groceries too. I found recently that eating in, groceries were expensive because I had made so many prepared foods’“canned tomatoes and beans, both of which are half the price if I’d bought them fresh and made them myself. They’re handy shortcuts, but you’re paying essentially for someone else’s time canning your food. Once I realized that, I was able to save more money by buying the components of prepared foods that I liked.
Your real area of opportunity here is freelancing. She’s doing head shots right now, but is there any way to increase that? Additionally, you could be doing something freelance to bring in additional income. Writing is an easy one to start, and we have a series on how to freelance right here on Queercents. It might be beneficial for both of you, because you look as though you’re mostly doing okay. In the event of an emergency, though, what happens? That’s why it is so important to try to increase your income. A modest increase of even $100 a month would mean quite an emergency fund by the end of next year.
Does anyone else have advice for Maria & Caroline? Let us know in the comments below.
I don’t have any advice beyond pat yourselves on the back and celebrate your thriftyness. You make $1044 a month combined (approximately) and have a small emergency fund and no credit card debt? Wow! There are plenty of people who make 5 or 10 times that amount with no emergency fund and with plenty of credit card debt. Yes you can increase your income slightly but it sounds to me like you’re weathering college which is a hard time financially wonderfully.
I agree with Debra. I think Maria and Caroline are doing awesomely and I’m impressed at their budgeting.
Let me be clear–they are VERY thrifty and doing well. There’s just no money going into savings, which is necessary! That’s the only major thing they should change, but other than that, awesome job.
I agree on the freelancing idea. There’s got to be some way of increasing income. Scaling back a bit is a good idea, but saving $5 here and there isn’t going to be as noticeable as say an extra $300 a month.
Utilities–how insulated is your place? Can you put up curtains, draft dodgers, and the like? I know that certain areas (e.g. Missouri) are often under-insulated.
Income–can you pick up any additional work such as help-desk or library/gym proctoring? These are great if available because you can study while you work but may be reserved for those who are still eligible for work-study funds (i.e. the school gets back part of what they pay). Also look for occasional gigs like weekend event help or summer jobs.
Discretionary–can you give yourselves smaller allowances? E.g. $75/month would allow you to tuck away another $100/month. “Buy” each other “gifts” at the library or by window-shopping. It also means less to pack up and move. (Believe me, our last move had about 2000 books plus furniture and a large floor loom….)
You are almost done with school–congratulations! Just make sure you have the cash to cover moving expenses, rental deposits, etc. at graduation time.