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How to Save Money in Your 20s

07.13.2020 by admin // Leave a Comment

Saving money in your 20s will help you achieve financial stability. A lot of people in their 20s are dealing with student loan debt and aspiration for days of having a strong financial cushion and achieving their dream lifestyle. While it’s easy to think that financial planning may be pointless at this stage, the baby steps taken now will create a financial foundation. Increasing your income is most important, but spending less than you make is a close second. Increase your income, be smart with your spending, save money and invest are the recipe for success. Here are tips on how to save money in your 20s to set the stage for a strong financial future.

Increase Your Income

It’s not about what you make, it’s about what you spend is true. However, it’s a lot easier to save money when you make more money. Your lifetime earnings are decided in the first decade of your career. As a result, increasing your income in your 20s is especially important.

There are several ways to increase your income. First, hustle at your job and create a plan to double or triple your salary. This plan may include strategic networking to get promoted or switch industries, identifying what you need to do advance your career, get another degree and / or expand your skill set. Second, build additional streams of income. In order to begin generating passive income, you need to have money first. To build wealth quicker, start a side hustle in addition to your day job. As your income increases, keep your spending flat. This will allow you to save even more money in your 20s.

Save Money In Your 20s by Being Frugal

Now that you’ve focused on making more money, how do you avoid spending your entire paycheck? Control your expenses. Do you make more money than your friends? Doesn’t matter, spend as if you make less. Consistent saving and investing, especially in your 20s, can be an effective way to accumulate wealth. The more you save in your 20s, the less you have to save later in life due to compounding. See how even small savings amounts can add up over time with this compounding interest calculator.

In your 20s, this means being frugal for a few years. You don’t have to be frugal forever. The longer you’re able to live frugally like you lived in college the easier your finances will be. Being frugal also doesn’t mean never having fun. You don’t have to cut back in all areas either, the single most important expense is housing.

Save Money On Housing And Live with Roommates

Some of the best ways to save money in your 20s include being smart with housing. Housing is likely the largest expense in your 20s. Once you sign a lease, you’re stuck with that expense until your lease ends. Don’t become “house poor.” Experts say housing should be no more than 30% of your gross income and that includes all housing expenses. However, this doesn’t mean you should spend 30% of your gross income. The less you spend on housing the more money you’ll have available to save, pay down debt and spend on other things you enjoy. Want to live in a certain location? You may have to settle on the amenities and living with roommates.

The most sure way to save money on housing is to live with roommates. Not only are you able to spend less per month on rent, you’re also able to split utility bills, and split buying the furniture. It’s expensive to furnish your first place. Splitting these costs will save you a ton of money the first few years and enable you to start building a savings cushion. Bringing your own lunch can save $7 / day or $140 / month. Being smart with your housing can save you hundreds a month and thousands a year.

Buy A Used Car or Skip The Car Altogether

The next biggest cost you’ll likely have is transportation. Sometimes, a car is unavoidable. You need it to get to your job and back. But, with remote working increasing, public transportation and rideshares becoming more available can you skip the car for a year or two for a little inconvenience?

Before you buy a car, do the math. Can you use public transportation, bikes and ride shares? How much will this cost you per month? Then, compare this to how much it’ll cost you to own a car. Don’t forget, the money you spend on a car could have been invested and earning you more money or paying down debt. Car expenses also include maintenance, gas, parking, insurance and depreciation. If you can, skip the car. If not, spend as little as you can on a car in your 20s. You can always get a nicer car when you have more money.

Save Money on Food and Drinks

There are ways save money on food and drink and still have fun. You can still go to restaurants and bars and save money in your 20s. Take advantage of happy hour specials. Go over a friends house and have a drink before heading to the bar. When you get to the bar, limit yourself to one drink. Invite people over to watch sports instead of going to a bar. Take advantage when there is free food at events. Bring your lunch. Set a monthly budget for eating out and going to bars. There are plenty of ways to continue to enjoy eating out and also save money.

Eat at home for all other meals and bring your lunch. Planning your meals and using coupons on groceries will save money. Don’t order takeout and instead save your eating out money for when you go out with friends.

Limiting spending on food and drinks is a great money move in your 20s because it starts developing discipline around spending money. It’s hard to say no to always going out with friends and spending money on food and drink but it adds up. But, this is small amounts of money compared to later on. If you can’t say no to going out to save money, how are you going to do when you’re invited on $1,000+ vacations? Practice saving money here and the discipline will spill over to other areas.

Be Frugal With Your Vacation Spending

The best time to travel is in your 20s when you have less responsibilities and more time. This is also when you have the least amount of money so how do you best balance this? Save money in your 20s by taking road trips. Rent a house with friends to reduce spending on lodging. Split a hotel room with 3 other friends to reduce costs even more. There are also plenty of ways to save money on travel, you don’t have to give up travel entirely.

Another option? Work for a global company and take advantage of traveling for your job. It’s much cheaper to spend 2 extra nights in Europe when you’re flying there for work than paying for an entire Europe trip. At minimum, sign up for every single travel loyalty program. This way, you can accumulate points to use for free nights, free airfare and free car rental days. You can also get a good rewards credit card and redeem for free travel.

Limit Spending on Clothing

When you first graduate college you will need to spend some money on clothing. Your college wardrobe won’t suffice for a professional wardrobe, attending weddings, etc. Spending money on clothes in unavoidable. You can continue wearing free t-shirts for a while at home, at the gym and on weekends but at some point you will want to upgrade there too. When you do spend money on clothing, take advantage of sales. Also take advantage of shopping second hand like on Poshmark and even sharing clothes with your roommates if you can. To start to build a wardrobe, buy 1-2 nice things a year like a good pair of black heels and a nice leather black tote.

Take Advantage of Company Benefits

Salary is important, but don’t forget about job benefits. Job benefits include vacation time, health insurance and 401(k) match benefits but did you know there may be more benefits to help you save money? In college you were able to get discounts with your college ID. Post college, look for ways to use your company ID to save money. Some health insurance plans offer money towards a gym membership every year. Depending on the industry and area, companies may offer free or discounted food, free gyms on-site, discounts on auto insurance, discounts on personal travel and more. Look at your internal company site to learn more about perks offered by your company.

Track, Manage and Reduce Your Spending

Now that you have those saving money tips, know how you are spending your money today. Can you use any of the tips above to save money? You must spend less than you make in order to save money in your 20s. To do this, you need to understand where you’re spending your money. When you just graduate, you’re adding a lot of new expenses. For the first few months, track every expense and see where you’re spending your money. Don’t change any behaviors, only add tracking what you spend and follow how you normally spend your money. At the end of the month look back at what you spent your money on. Do the same for the following month. Are you spending more or less money than you are making? Were all those purchases necessary? How did your spending change month to month?

Create a Budget

Saving money in your 20s starts with having a budget. Create a budget that works for you and isn’t too restrictive, otherwise you’re less likely to follow it. There are plenty of apps like Mint which make this process much easier. First, input your regular bills like rent, electricity, internet, etc. These are all of the bills you must pay. There may be ways to decrease these bills later, but for now put what you pay today. Set aside money for the things that bring you happiness and finally add in everything else. Be realistic too – you’ll need clothes and you’ll be invited to a lot of weddings in your 20s.

It’s ok if your budget is imbalanced when you first add everything together. Budgets take multiple iterations to get right. Keep shifting around numbers until you’re able to balance your budget. If you find that no matter how much shifting you can’t find ways to save money with your current income though then you need to start looking at ways to make more money.

Set a Savings Goal and a Retirement Savings Goal

You want to save money in your 20s, but how much? Give yourself a goal for how much you money you want to save per month. It doesn’t have to be a high number – you can start with even $5 a paycheck and increase it. Use this money to start building your emergency fund, so if any emergencies arise you have cash to cover it. You can find a calculator here to help identify how big your emergency fund should be. And, don’t forget to save enough money for retirement to get your employer match if they offer it at minimum.

One trick to avoid cutting spending is to move more of your saving towards your 401(k) contributions. 401(k) contributions are pre-tax, so you’ll reduce the amount of taxes you owe in your budget. Once you’ve identified how much money you want to save, or can save, automate it! One of my favorite money saving hacks is to automate your savings. Take these steps to automate your savings and watch your savings grow.

Where Do You Put the Money You’ve Saved?

Where should you put the money you’ve saved? Money saved in your 20s should first be held in a high yield savings account as part of an emergency fund. Unfortunately, there have been interest rate cuts across the board including high yield savings accounts, so you won’t make much money here. But, it is better than nothing. Nerd Wallet shares here the top 10 best high yield savings accounts. You can also look for banks offering sign up bonuses.

How to Save Money in Your 20s Summary

How to save money in your 20s can be summed up in a few simple steps. Increase your income and keep your spending flat, saving the difference. Be frugal for a few years. This includes living with roommates and spending as little as possible on transportation. For all other expenses prioritize what brings you happiness and cut back spending in other areas. Set a savings goal and stick to it. Yes, saving money in your 20s is harder than saving money in your 30s. Your salary is lower and you don’t own much yet, increasing your initial expenses. But, your lifestyle expectations are also the lowest. The more you can save when you’re young the easier it is as that savings will continue to generate passive income for you. Set yourself up for success by saving money in your 20s.

Here are more smart money moves to make in your 20s.

How to Ask for a Job Referral

06.29.2020 by admin // Leave a Comment

Fast track your job search by asking for a job referral. Being referred by a current employee is a great way to stand out when applying for a job. Asking for a job referral may seem like asking for a favor, but many times the employee can get a bonus if you get the job. Below are tips for how to ask for a job referral and how to ask for a job referral sample email.

Why Ask A Current Employee To Refer You?

Employee referrals make up between 30-50% of hiring in the US. If you want to fast track your job search ask a current employee to refer you. This will increase your odds of getting that first interview. It’ll help separate you from the hundreds of other candidates where it is so easy to get lost. After that, you’ll also have the opportunity to ask them questions about the interview process, culture of the company and more. This will help you determine if the company will be a good fit and help prepare for interviews.

Don’t feel bad about asking someone in your network for the referral. Most people are happy to help. In fact, many people even get employee referral bonuses if they refer a candidate that gets hired. Employee referral programs are a benefit both for job seekers and current employees. Job seekers improve their odds of getting the job and employees have an opportunity to make additional money as well as help out their network.

How to Ask For Referrals For a Job

How you ask for a referral for a job depends on how well you know the person. If you know them well, you’re likely in luck. They’re able to speak to how qualified you are as a candidate and can speak to you as a person. But, understand that not everyone feels comfortable referring someone to a job. Always give someone an out, stating that you completely understand if they don’t feel comfortable doing so.

When you ask for a job referral, the more specific you are the better. Share which job you are interested in and provide the link to that job posting. That way, if the employee needs more information to refer you, like a job ID, they can get it from that posting. If you don’t know what job to apply to ask to meet with that person first. Have a discussion about what types of roles you’re interested in. Ask questions to help narrow down what departments to research more. Lastly, share that you’ll look at current job openings and ask if they will refer you if you find one you want to apply to.

When you are asking for a referral, don’t ask someone to do your work for you. Vaguely asking someone to keep their ears open if they hear of anything is unlikely to result in an opportunity. Especially in large companies, unless an opening opens up on their team it’s unlikely they’ll hear of most job openings.

Process of Getting Referred To A Job

First, find a job you’re interested in at that company. In order for someone to refer you to a job, they need to know what job you’re interested in applying to. If you’re not sure what company you’re interested in talk to a few friends about the companies they work for. Read recent articles on the top places to work like the Top Places to Work in 2020 from Glassdoor.

Once you’ve narrowed down your list of prospect companies, search on sites like LinkedIn and Indeed to find open jobs. Then, search that company on LinkedIn to identify who you are connected to, or who is a mutual connection, that currently works there.

Reach out to them asking for the referral and share the job you’re interested in applying to. Make sure to have your resume handy and send it to your connection. Most companies have an internal site they have to submit the resume to, or they have to email your resume directly to the recruiter or hiring manager. They may have some feedback on tailoring your resume to the company, so make sure to have some time to edit based on their feedback just in case.

If it’s a portal, once your connection submits your resume you will likely receive an automated email. At this point, you will likely have to fill out additional information and confirm you are applying for the role. If your connection forwards your resume onto someone, you may just hear the next steps from your connection.

Don’t forget, being referred by an employee doesn’t guarantee you the job. But, it does make it much more likely your resume gets seen and that you get a first interview. From there, it’s up to you to excel in the interviews.

How to Ask For a Job Referral Sample Email

Not sure how to ask for a job referral in an email? The formality depends on how well you know someone but it can follow this general example:

Hi [Name],

How are you doing? [Add something personal to connect with them, perhaps asking about their kids, or mentioning a sports team you both enjoy]

Recently, I’ve been thinking about my next career move. I started browsing job openings on LinkedIn and saw this opportunity for [job title at company] that I found really interesting. By chance, do you still work there? If you have some time, could I ask you a few questions about what it’s like to work for this company? If it sounds like a good fit, I’d really appreciate if you could refer me to the role through your company portal. I completely understand if you prefer to not send a referral for the role.

I hope you and your family are well.

Best,
[Name]

How to Ask for a Job Referral Summary

Don’t submit your resume directly through the application portal. Stand out by having a current employee refer you and increase your chances of getting the job! Many companies leverage their employees networks to recruit. Getting referred to a job will increase your chance of getting an interview. And, if you get the job the employee that referred you may even get a bonus. But, to be successful do your homework. Know what companies you’re interested in applying. Find people in your network that work at those companies. Figure out which jobs you want to specifically apply to and ask your connection to refer you to that job.

Have you ever been referred to a job by a current employee?

How to Plan a Baby Shower On A Budget

06.11.2020 by admin // 2 Comments

Throwing a baby shower is a great way to celebrate the soon to be parents and help them prepare for their little one. But, it’s easy to get caught up in the party planning. Babies are expensive, and in reality the parents need practical baby items more than they need an expensive party. There are plenty of ways to throw the perfect baby shower on a budget. There are ways to throw a memorable baby shower without breaking the bank. Here are tips on how to plan a baby shower on a budget.

HOW MUCH SHOULD YOU SPEND ON A BABY SHOWER?

First, how much should you spend on a baby shower? There is no amount you need to spend, but according to CostHelper Children baby showers typically cost $100-$1,000. The main drivers of cost are the venue and the amount of people you invite. You can also reduce the amount of money you spend hosting a baby shower by finding a few friends to split the cost with.

DIGITAL BABY SHOWER INVITATIONS

Save money hosting a baby shower by sending digital invitations. When you’re hosting a baby shower on a budget, the most inexpensive baby shower invitations are to send invitations via email. This will save you money on design, postage and the invitations themselves. If you choose to email the invitations, you can use free designs on Evite, or elect to design your own invitation which can cost anywhere from $13 to $50 depending on the event size.

If you want to mail invitations anticipate spending $1.50 to $2 per invite. Postage today ranges from $0.55 to $0.70 per letter depending on the shape of the envelope. You can design invites on Shutterfly, which cost about $1 / invite. Shutterfly does tend to have a lot of sales so check online first to see if they have a current discount code before purchasing.

LIMIT THE BABY SHOWER INVITE LIST

The amount of people you invite to a baby shower will drive up the cost. The money you spend on food and beverage is tied to the amount of people you invite. If you host the baby shower at home you may have to rent chairs and tables. If you host the baby shower outside the house you may pay more due to needing a larger room.

With sheltering in place, we’ve all been introduced to another option: Zoom. With also having a Zoom link you’re able to expand the invite list without paying more for a venue and food. It also helps people you invite save money as if they aren’t local they don’t have to spend money on a plane ticket or long car ride.

PLACES TO HAVE A BABY SHOWER

Where should you have a baby shower when you’re on a budget? The best place to have a baby shower on a budget is at home. Or, if money is really tight the cheapest place to have a baby shower is on Zoom. If you can fit everyone at your house, you won’t have to pay for a venue or set amount per person at a restaurant.

Do consider how many people you can accommodate at home. For example, do you have enough tables and chairs for the amount of people you’ve invited? If you have to rent a tent, table and/or chairs these expenses can add up quickly and it may be cheapest to go to a restaurant or other location. Location, food and beverage are the biggest ways to save money on a bridal shower.

BABY SHOWER FOOD ON A BUDGET

If you’re having the baby shower at a restaurant, know your budget and look for the venue that fits that. If you’re having the baby shower at home, will you make the food yourself or will you hire a caterer? Create the menu, estimate how many people will attend and then calculate how much it will cost to make yourself. You may find hiring a caterer or picking up food from a restaurant ends up being cheaper. A cheap make it yourself meal is to have a food bar. For example, have a taco bar. A taco bar is easy to prepare and relatively cheap.

One of the biggest costs of the food and beverage is the alcohol. Have a signature cocktail instead of an open bar to reduce costs or offer one mimosa per person if doing it at a restaurant. If you’re hosting the baby shower at home, limiting the amount of drinks such as sticking to mimosas will reduce the amount of liquors and ingredients you have to buy. Some liquor stores allow you to return any alcohol that was unopened as well.

BABY SHOWER DECORATIONS IDEAS ON A BUDGET

Save money when hosting a baby shower with DIY baby shower decorations and using gifts as the decorations. For example, remember all of those reusable vases, food platters and picture frames you bought for your friends bridal shower? Bring those back out from storage and reuse those.

For cheap floral baby shower centerpieces, bring vases you already own to Whole Foods. They fill each vase with a pretty floral arrangement for $10. Limiting the number of tables will reduce this cost.

Also consider decorating with gifts for the expectant parents. Create a diaper cake by following instructions from Pinterest. The parents can take this apart and use the diapers later on. Hang onesies instead of a banner. The parents can then take these home and start to build a wardrobe for their baby.

FREE BABY SHOWER GAMES

A great way to throw a baby shower on a budget is to use free baby shower games instead of buying them. There are a ton of free baby shower printable games that are available online for download.

Another cheap baby shower game is to take the onesies you’ll use for your decorations and have each guest decorate one with a personalized message. You can also do this with diapers.

INEXPENSIVE BABY SHOWER FAVORS

For inexpensive baby shower favors give the gift of food. Have the favor be part of the food and beverage for the shower. Use the desserts as the favor by making and wrapping cute baby themed cookies or set up a cute dessert bar. Set up dessert bar by displaying different types of candy in glass vases. Guests can make a candy bag to bring home.