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Short on Cash? Bootstrap Your Budget With These Simple Steps

07.24.2022 by admin // Leave a Comment

short on cash? bootstrap your budget. How to save cash quickly

Inflation is back and we are all feeling it to varying degrees. Many of the investments we’ve used to generate additional cash like stock market gains, crypto gains and margins from side hustles are also down. The economic uncertainty also makes many of us want to beef up our emergency funds just in case.

How can you make more money and increase your net worth in this environment? It’s time to get back to the basics with cash. While I am always the biggest proponent of focusing on generating income over focusing on cutting costs, it’s time for a quick checkup on spending, cash and personal cash flow while you work mid to long term on increasing your income.

Track Your Spending And Keep Your Budget Updated

Got a little lax on tracking your spending and sticking to a budget? If you’re short on cash, immediately stop spending money on wants and look for ways to reduce spending on needs as you recalibrate.

Then, go back and figure out where you’v been spending your money and what your cash flow looks like relative to your spending. A lot of credit cards have dashboards now that show you what categories you’re spending your money on every month. Checking accounts also have dashboards that show you your cash flow month over month. Start here.

Next, either update your budget or build your budget. Are there categories you can cut back on? Subscriptions you can cancel? Remember, spending cuts don’t have to be forever. Build a plan for the rest of the year. Define your needs verse your wants, and which wants are most important to you. Know that some of your needs are significantly more expensive than they were at the beginning of this year and budget accordingly.

The first part of increasing the amount of cash you have is to reduce the amount of cash you’re spending in the first place.

Unsubscribe from Emails And Get Off Social Media

Short on cash? Remove the temptation to spend cash by unsubscribing from emails and getting off social media. So many ideas of how you can spend your money are right in your face because companies and social media have gotten incredibly good at advertising things you like. They know what you’ve purchased before, or other posts you’ve looked at. Unsubscribe from emails and get off social media so you never see the deals, outfit ideas or dream vacation ideas. And trust me, there will be deals coming, because lots of retailers over ordered and they are going to need to clear inventory in the second half. Remove the temptation before it begins and when you truly need something search for the deals at that time.

Get Reimbursed For Medical / Health / FSA Expenses

Have you already spent money that you should be able to get reimbursed? This is an easy way to get back some cash quickly. For me, the first place I look are my medical / health/ wellness expenses because I have a FSA and my company offers a generous wellness benefit. This is a chore I loathe and always put off submitting my receipts until the end of the year so I can do it one time. But, I collected all my receipts a few weeks ago and submitted everything so far and got almost $400 back from just at home covid test reimbursements and figuring out the FSA eligible items I could submit.

At Home Covid Tests

At home covid tests bought after January 15, 2022 in the United States can be reimbursed through your insurance! Requesting reimbursement for at home covid tests through Caremark was an easy process for me and a few weeks later I received a check in the mail.

FSA Eligible Items

Some programs offer automatic reimbursements for prescriptions and doctors payments. Set that up once and it makes this process so much easier! But, there are other items that qualify for FSA reimbursements too. Did you know tampons and sunscreen are FSA eligible? So are many other items. If you have a FSA, it’s not just for prescriptions. See if anything else you’ve spent money on qualifies this year.

Wellness Program Reimbursements

My company offers a wellness benefit where we can get gym memberships, boutique classes, gym equipment and more reimbursed up to a certain amount! I took a few spin classes while I was out of town and submitted those for reimbursement. Check what is covered under these plans because you may be surprised how many wellness items you can submit for reimbursement. For example, I was surprised to learn recently that fitness trackers were eligible.

Use Your Gift Cards

You don’t have to cut back your lifestyle at first if you’re short on cash. Look for gift cards you already have to stores, restaurants and services you use and use those up first. Double up with deals or coupons to have the gift cards last even longer.

Use Your Credit Card and Reward Points

Did you rack up a bunch of credit card points in 2020 and 2021? Now is the time to use those. To make your credit card points go the farthest, know the cash value of your points. My credit card points are worth the most when used for travel, about 1.5 cents each. So, I always use the points on that credit card for travel. In a pinch, I’ll redeem for cash back and store gift cards.

The same goes for reward points. After staying at home for so long, of course many of us have the travel itch! Airline and hotel prices are at multi year highs now, use your hotel and airline points instead of booking for cash. If you can be flexible on dates, look for dates that require less points or set alerts on Google flights if you must use cash.

Save Money on Food

It seems like every time we go to the grocery store we feel the pinch of inflation more and more. It’s no longer a few dollars here or there. A trip to the grocery store that used to be $70 is now over $100. Use these tips to reduce the amount you’re spending on food.

Reduce Food Waste Through Closet Clean Out, Meal Planning and Grocery Lists

The first step we took to save money on food is reducing food waste. Go through your cabinets and find what’s expiring soon, and what ingredients you have. Plan meals that use these ingredients or find recipes that only require 1-2 more ingredients to buy. Write down everything you need to buy and don’t buy anything else not on that list.

As a household of two, many items we buy have way more product than we need. To make cheeseburgers we’ll buy a pound of hamburger meat and then the bag of buns will have 6 or 8. We’ve tried to get better with meal planning and now the week we make cheeseburgers we’ll also make BBQ chicken sliders. We’ll buy frozen fruit instead of fresh fruit, or freeze fresh fruit if we haven’t used it yet.

Instead of trying a new recipe that calls for a bunch of ingredients we’ll probably never use again, we’re also sticking to recipes that have less than 5 ingredients. We also are now walking to the grocery store, which is a great deterrent to buying anything we don’t need. Much harder to carry extra home than to drive it home!

Look for Deals on Food

We usually shop at Trader Joe’s but more recently we’ve gone back to the traditional grocery store. This grocery store now has all of their coupons online and with a quick 5 min search we can digitally clip coupons. Waiting to buy staples until they are on sale and buying and bulk are additional ways to save on food costs.

Personally, we don’t shop at Costco since we’re a small household and there are few things we need to buy in bulk. Even if something is cheaper per oz to buy in bulk if you end up throwing most of it away you’ve spent more than you would have if you bought the smaller size. A deal is not a deal if it’s something you wouldn’t have purchased in the first place.

Cut Out the Junk Food

I love junk food, and especially living in the city and walking around it’s so nice to get a refreshing juice or ice cream on a hot day to treat myself. Before, it’d be like $3, maybe $5. But now, with inflation plus the iPad tips these treats are costing closer to $10 each time. When I shop at Trader Joe’s I always end up with a couple of their almond butter cups and mint chocolates. These small purchases can add up and combined with everything else at some point you can’t afford everything like you used to. When you’re bootstrapping your budget, you need to decide what is most important.

Save Money on Transportation

There are no shortage of news headlines about how bad gas prices are these days, and advice to save money on gas by carpooling, doing several errands all at once and checking your tire pressure. Are there ways you can skip driving all together by biking or walking somewhere? It also may be cheaper to buy something online or get it delivered depending on the shipping and delivery prices.

If you live in a city, there are so many options available to save money. Get a membership for a bike or scooter rental company. Take public transportation. Walk when you can.

Identify Substitutes for Purchases and Celebrations

Some purchases you can’t delay, or don’t want to delay, so how do you use less cash to buy them when prices are soaring? Look for substitutes. If you need a dress to wear to a wedding, look on Amazon or on second hand sites like Poshmark. Keep in mind resale price too as Amazon you likely won’t be able to resell but a quality brand on Poshmark you can likely sell after.

If you’ve recently moved and need to furnish your house shop estate sales, buy nothing groups and these other money saving tips.

Refuse to stop traveling after being stuck at home for a few years? Pair up with a friend that lives somewhere fun and stay with them for a few days and invite them to spend a weekend at your place in return. Instead of the more expensive hotel, pick a cheaper hotel or cheaper room within the hotel. Celebrate a birthday in a backyard with a BBQ instead of going to an expensive dinner. Always look for the cheaper options and determine if the more expensive option is really worth it right now.

What are ways you’ve used to bootstrap your budget recently?

The Roaring 20s are Coming Back – Plan Your Spending Before It Gets Out of Control

03.29.2021 by admin // 2 Comments

Every day we’re getting more and more good news. Vaccine production is ramping. More shots are getting into arms. We hear that everyone that will want a vaccine in the United States can get it starting May 1st. We’re still a little bit away from that but there is a chance we could actually have a normalish Fourth of July. Summer 2021 could kick off our Roaring 20s.

All of those things you’ve wanted to do the last year – see your family, see your friends, go out to eat, go on trips and more can get pretty expensive pretty quickly. So, how do you celebrate the roaring 20s and plan your spending before it gets out of control? Prioritize what’s most important to you, look for the best deals and make sure you spend within your meals.

Know What Your Means Are

It’s important to live within your means. What your means are may be different than before the pandemic due to job changes or being able to save up extra over the past year. Whatever it may be, know how much money you’ll have available to spend over the next 6 months – 1 year. Then, know how much money you’re willing to spend over that same time period. These two numbers may be different. You may have more money available to spend, but you may want to now have a bigger emergency fund, pay down your student loans or increase your investments. Alternatively, you may have other life changes on the horizon (starting a family, starting a career) and have plans that are now or never opportunities and it’s worth it to save less than usual.

Prioritize What Is Most Important

You’ve given up a lot over the past year. Once things are safe again, where do you start? It’s not just about money, it’s also about how you’ll prioritize your time. Prioritize the most important things to you and then spend money on doing those things first. We’ve also been reminded over the past year that some of the most important things are really free. Being able to hug your parents, or go to a playground without worry for example.

Also consider, what did you used to spend money on that you should continue to not spend money on? For example, perhaps you used to spend a lot of money commuting. Can you go full time remote or hybrid so that you don’t have to spend as much money commuting as you did in 2019? This past year has taught us all how to spend more consciously and how easy it is to save money when we can’t travel, eat out and go to concerts. As life gets back to normal figure out what expenses shouldn’t come back. Similarly, don’t forget to budget new expenses you have that didn’t exist in 2019. About 33% of Americans considered getting pets in 2020 and according to CNBC dog owners spend an average of $1,200 a year on their dog.

Opening up safely may come gradually. That international trip you wanted to go on may have to wait a little longer. For anything that’s your top priority but can’t be done yet set aside some money for that so you don’t find yourself in a situation where you don’t have enough money to do the thing you really want to do.

Restart Your Life How You Want It

The pandemic didn’t just put our spending on hold, it put our lives on hold in other ways. Many parents had to juggle home schooling with working, and some had to put their own career plans on hold to survive the last year. Reassess your own goals, and what it will take to achieve them. These may look wildly different than what they were in 2019 and that’s ok. Where do you want to live? Where do you want to travel? Who is most important to spend time with? What do you want your career to look like? What do you want your usual weeks to look like? This may mean a promotion and more money, this could mean taking a step back and making less money. It’s something you’ll have to weigh as you reassess where your time and financial priorities lie in the post pandemic world.

Don’t Forget About Your Mental Health

The pandemic has been pretty traumatic and has affected everyone differently. In May 2020, the US Census Bureau found that about one-third of clinical anxiety or depression. If you run a marathon, do you immediately continue your pre-marathon training schedule the very next day? No, you take time to assess what you need for your physical recovery and do just that. We need to do the same as we emerge from the pandemic. There are plenty of resources to help with your mental health. Know what is covered under your insurance and make sure you take the time you need to heal your mental wellbeing.

Don’t Forget Sometimes The Most Important Things Are Free

You don’t have to spend a lot of money to make up for all of the things we lost over the past year. And while the year has been tough, we did gain a lot like appreciation for the simple things, the ability to slow down for a little, not having to spend a ton of time commuting and more. Hugging your parents or catching up with a friend doesn’t have to come with the expense of a $200 dinner. Remember, people are just happy to be with you in person again.

Find Deals On Housing

One of your largest, if not largest, expenses is housing. The less you can spend on housing the more money you have to spend on other fun activities or increasing your savings. If you rent, there is an opportunity to find a better deal on housing. Over the past year, what have you learned about where you want to live and what you want in your home? With many people moving back in with parents or leaving the city rents were in free fall in many cities in 2020. While rents have started to rebound there are still plenty of deals on renting in the city in 2021. In Boston, rents are down over 8% and in San Francisco rents are down over 12% for example according to the Home Buying Institute. As interest picks up landlords will have less incentive to offer these deals so signing a lease sooner than later will leave you more likely with a rent reduction or even a couple months of free rent. Waiting until later could cost you hundreds of dollars a month.

Find Travel Deals

Now that you’ve prioritized what’s most important, how do you still find good deals for vacations, seeing family and more? If you’re prioritizing seeing family or traveling book your travel ASAP. Many of the best deals were already 6 months ago when there was still a lot of uncertainty. Because there is still some uncertainty though your best bet is to start booking refundable flights and lodging now while the hospitality industry is still trying to lure people back. Make sure you know what the policies are to cancel or reschedule in case you do have to push it back.

See Also: 5 Tips To Save Money On Travel

Find Deals for Clothing And Other Physical Goods

Most people that have been able to work from home the past year have spent most of their time in the same loungewear outfits. With most people spending more time at home than usual many have taken the opportunity to organize their closets. They’re donating clothes and also selling them. This has led to a lot of great finds at thrift stores, Poshmark, The RealReal and local consignment stores already. For the best deals, buy secondhand or buy clothes when no one else is buying.

The Roaring 20s are Coming Back – Plan Your Spending Before It Gets Out of Control Summary

It has been a long year and we’re all excited for things to get closer normal. We’re excited to see friends and family, be able to travel again, pick up the hobbies we’ve had to put on hold and more. Before you spend all your money make sure you know what your financial limits are and what is most important to you. Prioritize your money, prioritize your time and remember, don’t feel guilty about spending money. We’ve sacrificed a lot over the past year, enjoy seeing the people you’ve missed, the places you’ve missed and completing your bucket list.

Advice for 2020 Grads From a Millennial That Graduated in 2010

08.14.2020 by admin // Leave a Comment

advice for recent college graduate, advice for recent grads, advice for recent graduates, advice for graduates, career advice for graduates, financial advice for graduates

College graduation has come and gone. The pandemic, unfortunately, has not. It’s a tough job market out there for new grads. Glassdoor Economic Research found that new grad related job openings fell 68% in May from the same time last year. They also found that 7 of the top 10 companies attracting the most new grad applications are tech companies. This is no surprise since tech companies tend to offer high salaries.

It’s not just job postings either, good salaries are tougher to find during recessions as well. According to the National Bureau of Economic Research graduating in a recession leads to large initial earnings losses of about 9% of annual earnings in the initial stage eventually recede but don’t disappear until about ten years after graduation.

Don’t get discouraged by this news. While it’s tough, there are still ways to thrive. I graduated in 2010 and saw a lot of this first hand. We had less paid internship opportunities in college. Entry jobs didn’t begin opening up until much later. We also saw many of our friends who graduate a year or two above us get a job offer and then have it revoked, get laid off after only months of working or struggle to get that first job after graduation. Based on what I saw during the Great Recession and how we all took control of our jobs and our finances in the decade since here is my advice for graduates.

Be Prepared To Share Your Resume and What Jobs You’re Interested In At A Moments Notice

My top career advice for graduates is to always be prepared. Practice your 30 second elevator pitch on your background, what you’re looking for and how you add value. Always have your resume up to date, even if you’re content in your current job.

You know you need to prepare for a job interview, but how prepared are you for a chance encounter? While in person chance encounters are less likely during social distancing, they can still happen through word of mouth. Perhaps one of your parents, a relative, a friend or a neighbor hears of a job and contacts you. Will an opportunity land in your lap? It’s unlikely. But, if you tell people you’re looking for a job and put yourself in situations where you meet new people these types of chance encounters are more likely to happen.

These are the situations you need to be prepared for. If there is an opportunity, they’ll ask for your resume to share. They’ll ask about what types of jobs you’re looking for, so they can think about if they know of any openings.

Do have your resume always up to date. Do be clear with what you’re looking for. Don’t say you’re open to anything. By keeping it too vague it’s hard for someone to help you. That doesn’t mean you need to know exactly what you want. Here are a few ways you can answer it:

Talk about your background – what did you major in? What were you most excited about in your internships and classes?
Location – are you looking for a job locally or are you open to moving for a role? Do you have a preference?
Are you looking for a full time or part time role? Are you open to a role that starts as part time but could lead to something full time?
Speak to your skill set – what areas are you strong in?

See Also: How to Ask for a Job Referral

You May Not Land Your Dream Job… and That’s OK

Millions of Americans are unemployed or furloughed. Competition for jobs right now is tough. So, chances that you’ll land your dream job are slimmer. But, that doesn’t have to be a bad thing! Think back to when you were applying to college. Did you end up at your dream school? Did it all work out in the end?

To put things in perspective, you’re also in your early 20s. Most people do not know exactly what they want to do with their lives at this age. It’s a myth that everyone knows exactly what they want to do when they graduate college. It’s important to be flexible. Take a job and figure out what you enjoy and what you don’t enjoy about that job. Then, continue looking for ways to enjoy that job more, or look for another job you’ll enjoy more.

The job opportunities available now may be wildly different than your major. Your opportunities may even be going back to where you worked part time in high school. That’s ok. No company is going to frown upon the interim job you took during a pandemic.

Know What Seems Like Settling May Be The Best Thing That Happens To You

I stumbled into the tech industry at the recommendation of my career center at college. I had no idea what my dream job would be then. We were in middle of the recession so I got an offer and accepted. Turns out it was the best thing that could have happened. The tech industry is an amazing industry to work in. I met countless mentors and sponsors that helped torpedo my career. Now, everyone wants to work in tech! But back then, almost no one I went to school was trying to get a job in tech.

Some of my friends in tech sales that graduated around the same time have shared they joined a tech inside sales program because those were the jobs that were available. Sales reps at several high tech companies say they earn an average of over $142,000 a year. Here they were in the middle of the Great Recession and they ended up getting their foot in the door to one of the best paying jobs that doesn’t require an advanced degree.

Use Your College Career Center To Identify Open Positions and Helpful Contacts

Career Services on campus is a great resource for current students and recent alumni. They have access to tools that can help you identify what careers to pursue. Often, they’ve helped alumni get their jobs and have maintain those relationships. When you’re trying to get an in at a company they may know of an alumni to reach out to. They also have relationships with companies that hire entry level positions. Career Services may even be the most important office on campus according to an opinion piece on Forbes.

Network With Alumni

If you’re looking at jobs at a company my advice for graduates is network with current alumni at the company. That way, you have a connection that you can reach out to for a referral if a job does open up. Don’t expect alumni to reach out to you with any opportunity they hear. It’s likely they are busy. Instead, monitor the open jobs at that company and reach out again when you see one you’re interested in.

First, reach out to alumni you have relationships with asking if they know of opportunities. Remember to be as specific as you can with what you are looking for. Join LinkedIn Alumni groups for your college and also look to join ones on Facebook. Sometimes there are even subgroups for a certain location. Post in these groups and share your story. Many people are happy to help, and may help offer advice even if they don’t know of any job opportunities currently available.

Consider a Paid or Unpaid Internship In The Short Term Instead of a Full Time Job

While you’re looking for a full time role, one path to potentially get a full time offer is to accept an internship. An internship is helpful if you don’t have much experience on your resume and you need a little more experience to start landing interviews. Internships are also helpful if the company isn’t hiring full time right now but may be hiring for full time positions in a couple months.

Add To Your Experience Through Volunteering

Not all experience is from internships and part time jobs. You can also show your experience through your volunteer experience. Use this experience to show how you’ve built leadership experience, reliability and additional skills that are relevant to the jobs you are applying to. Not all volunteering has to be in person or even at a non-profit.

If you see a local business struggling and they don’t have a social media presence offer to help them set it up for free and add that experience to your resume. This also opens up opportunities for future paid work. They may recommend you to their network and you can begin charging for your time.

Be Frugal For The Next Few Years

My top financial advice for graduates is to be frugal for the next few years. It’s not the best economy right now and we don’t know how long it’ll take to recover. So, once you get a job keep conserving as much cash as possible. It’s not like there is a lot to do now anyways with businesses closed and limited travel options available. Plus, if you have a remote job you don’t have to buy more than a few shirts for Zoom calls.

Ways to keep living like a college student include cheap housing and cheap food. Keep living at home or move in with roommates into a starter apartment. If you’re moving out, try to negotiate rent. Vacancies are up right now so you’re more likely to have success negotiating things like a free month of rent. The next biggest expense is transportation. Hold off on buying a car especially if you don’t know where you’ll end up living. Use your current car as long as you can. If you don’t have a car, buy a used car and shop around for deals.

Hang out with friends outside instead of going to a restaurant. Go on a walk, or bring food for a picnic. Drinks and food at restaurants are expensive and with many bars closed there are less cheap drink specials to be found. Eat at home. When you buy groceries, look for coupons and deals. There are also ways to spend less on food by buying cheaper options. For example, buy oats and make oatmeal instead of single serve yogurts. You can find dinner recipes and meal planning tips to save money.

Is frugal living not for you? This doesn’t have to be a permanent lifestyle, but the longer you’re able to live frugally like you lived in college the easier your finances will be. You don’t have to cut back in all areas either, the single most important expense is housing.

See Also: How to Save Money in Your 20s

Start An Emergency Fund Once You Land A Job

Once you land a job, whether it be part time or full time, start an emergency fund. An emergency fund is an amount of money set aside to cover emergencies if they arise. The money should be easily accessible and liquid (such as money held in a checking account or savings account) that you have for when things go wrong. This includes an unexpected health bill, unexpected car repair, if you lose your job and so forth.

At this point, don’t worry about how much money you should have in an emergency fund. Your focus once landing a job is to start an emergency fund, even if it’s only contributing $5-10 a paycheck. If your family gave you some money for graduation put some of that cash in your emergency fund. Get in the habit of consistently contributing a little money with every single paycheck, and automate the savings so you don’t even have to think about it. Once you are more settled, you can start building your emergency fund.