Rental Property Investor · Charlotte, NC · Member since 2016 · 36 posts · 10 votes
Hey everyone,
I am graduating college in a week or so, and want to be prepared to budget effectively as I start getting real income for the first time. I'm curious as to how you manage your money, any apps you use for tracking spending etc, and any tips or tricks.
Rental Property Investor · Sour Lake, TX · Member since 2018 · 38 posts · 76 votes
7y
@Eric Fitzgerald congratulations on graduating! I have used mint.com for 10 years and really like it. You can track and itemize all your purchases, net worth, net income etc to help you identify how to optimize and set goals.
My biggest piece of advice is however poor you've been living in college... Roommates, cooking at home, driving a beater, keep doing that for as long as possible. At least until you get married.
Crested Butte, CO · Member since 2017 · 27 posts · 9 votes
7y
@Eric Fitzgerald
Check out personal capital. Free to use and similar to mint for tracking net worth.
Track your net worth.
Invest early if you can, max our Roth IRA- becomes tax free money later in life
Buy real estate as soon as possible. I bought house at 23 and then refinanced later to pull out equity
The key with budgeting is to live below your means! Avoid comparing to others.
Read the millionaire next door and rich dad poor dad if you haven’t already. I’m a big fan of thinking big and writing down your goals.. I’d say follow Grant Cardone instead of dave Ramsey.
Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
7y
Congrats on graduating college. I work with a lot of younger professionals and also am 27 myself. Set up multiple accounts so you have one for down payment, one for day to day spending, etc. is advice I always give when people say need to save a bit more. Also look at selling anything you don't need anymore like bikes, etc. It's usually not to hard to come up with 5% down if you get creative.
Your biggest cost out of college will likely be rent. Roommates can be cool or doing a house hack (buy a 2-4 unit) live in a unit. I personally hated having roommates but some people like it and definitely saves money.
Rental Property Investor · Milwaukee, WI · Member since 2019 · 3 posts · 3 votes
7y
I agree with everyone recommending Set for Life. Another great book is Your Money or Your Life. Read those two and you'll be good to go! I use the Mint app to track expenses. Open a savings account at Ally or another online bank to maximize your interest earnings. I also have an investment account through Wealthfront (robo investing platform) and have a monthly recurring deposit set up. The most important lesson is learning to find more satisfaction from saving than spending and you won't need to rely on complicated budgets.
Waipahu, HI · Member since 2018 · 121 posts · 81 votes
7y
I use Mint, digit, Ally Bank, credit karma and max out my 457b. Mint is great budgeting. Ally has a high 2.2 interest rate savings account. credit karma let's you know your score for free, and any charges you might miss. Digit saves your extra money. Great for a rainy day fun. 457 or 401k s are a must, especially if there is a match.
Investor · Eugene, OR · Member since 2018 · 46 posts · 35 votes
7y
@Steve Vaughan Steve has it right. Start off with Dave Ramsey and start a budget and get through baby step 4. That will give you a 3 to 6 month emergency fund. After that you live on nothing and save up as much money as you can.
House hack a fourplex would be a good idea as well.
Eagle Lake, FL · Member since 2018 · 20 posts · 3 votes
7y
@Eric Fitzgerald congrats, you can try good budget. I used it to keep track of my spending. You can set a budget for each one of your expenses and view it live to see where you stand at any time of the month. It definitely helped me keep my spending under control and to be ab lb e to save up. Hope it helps you too. Good luck!
There are so many things you can do to put yourself ahead. Some of the things I’ve done are what I’m listing and it helped me get to buying my first investment property in only about 2.5 years.
1. Make and keep a budget.
2. Live frugally.
3. Pay yourself first. (Can be for investment account, retirement account, emergency savings, etc. Depends on your situation)
4. Have emergency savings!
5. Find ways to increase your income.
6. Keep educating yourself. There are tons of free ways I’ve been using. Podcasts, borrowing books from the library, borrowing books from my mentors, etc.
Even today I still do this working towards my next couple properties. The fact that you are starting now will put you ahead of many others!
Rental Property Investor · Newport News, VA · Member since 2018 · 264 posts · 130 votes
7y
I highly recommend you create an Excel spreadsheet to track your expenses in detail every month. You don't know what to fix if you don't know what's going on in detail.
I still use mint.com. The integration with banks and credit cards is very nice. We have a great system for budgeting and categorizing using the 'Trends' view.
I use Expensify to track business and investing expenses.
1st, get yourself a credit card if you haven’t already. Use it for every purchase to build credit. Always pay it off in full.
2nd, track every dollar of your spending. If you’re on top of your spending you’re in control of your financial future.
3rd, start putting money away towards retirement or the stock market as soon as you get that first check. Don’t get used to having 100% of your check as spending money.
4th, each time you get yourself a raise, don’t raise your standards of living. Most start buying more expensive things when they earn more. Learn to put away and invest more as you earn more.
5th, always remember to be frugal. Buy used, go to car max, buy from FB marketplace, buy on eBay. Always try to save!
Lender · New York City, NY · Member since 2016 · 21 posts · 13 votes
7y
As others have previously said, I've found that tracking your expenses plays a significant role in managing your spending. Even if you do not budget, just the practice of reviewing the various categories of expenses you are spending in weekly creates this conservative emotion in your head causing you to reduce spending habits.
I've used Mint for about 3 years and just recently switched over to Quicken. I like it so far and notice it can produce much more data than Mint. Only downside is that it is not as user friendly and has an annual fee.
Virginia Beach, VA · Member since 2017 · 13 posts · 2 votes
7y
@Eric Fitzgerald
Check Dave Ramsey. I used a lot of his guidelines to make my own spreadsheet.
Write down all the bills and expenses you have to pay per month. Then add in how much you are going to save for eating out gifts and entertainment. And stick to that budget. Then use the rest of the money that's left over to pay off debt or invest.
I would say find an accountability partner or friend, to help keep you accountable to your money goals. Don't be like me and do good 6 months to a year before I would get distracted by life and start over in a few years. This last time I've had a better accountability partner and I'm still going strong at 18 months.
Setup systems to move your extra money out of sight. My last few employer's have the ability to send my paycheck to different accounts.
Rental Property Investor · Ithaca, NY · Member since 2015 · 1k+ posts · 1k+ votes
7y
@Eric Fitzgerald
I write my expenses on a list and get an idea what my monthly expenses are. My best tip is to not buy expensive items that lose value. Like clothes, a car, cellphone, eating out, monthly subscriptions. Then buy things that gain value. Houses, stocks, bonds, commodities.
Rental Property Investor · Albany, NY · Member since 2015 · 51 posts · 18 votes
7y
@Eric Fitzgerald
Write down your take home pay
Write down your total expenses
Find ways of eliminating expenses
Subtract expenses from take home pay and see your left over money
First thing is to create an emergency fund so if you ever lose a job you can still survive..typically 3 months is good, but I suggest 6 months
Use a high interest savings account
I recommend reading ramit sethis book I will teach you to be a millionaire and Scott Trench's set for life.
There are tons of strategies out there for saving and making money, you'll have to find what works best for you and most important thing is to stick with it. That's all.
For me- it's automation I don't want to think about my bills on a monthly basis nor do I want to think about how much to save monthly. I have transfers set up every two weeks for savings, bills, and investments and then what's left over after that is "free money that I can use for what I want. I hate concept of budgeting every little thing out. It's not sustainable in long run and you're living too in the books rather than enjoying your life as well.
Janesville, WI · Member since 2018 · 11 posts · 18 votes
7y
I wasn't a fan of mint or personal capital because I couldn't personalize it as much as I would like. I use an excel spread sheet I've built over the last two years that works great for me. Every two weeks when I get paid, I review my CC, bank transactions, and log everything. Spend about an hour every two weeks, but manually doing this makes me really aware of where everything is going then we review together once or twice a month. I'd recommend experimenting a little and find what works for you, Mint and personal capital are easy enough to set up, it's worth trying. But if you like excel, just build one that you can make fit your financial life.
Rental Property Investor · Farmington, UT · Member since 2018 · 171 posts · 148 votes
7y
@Eric Fitzgerald we use a spreadsheet and track every expense. We have categories for how much we budget for each type of expense. We use it in tandem with a citi double cash credit card and that pays for Christmas :)
Investor · San Diego, CA · Member since 2016 · 265 posts · 305 votes
7y
Eric Fitzgerald
Check out PersonalCapital.com for managing your cash flows and investments. It is more powerful than Mint.com, but you can decide what makes sense for your current personal finances.
Use a credit card (with no annual fee) for as many living expenses & discretionary spending as you can. It is important to build up your credit score to have the ability to do bigger transactions with lenders down the road. The catch is that you must be disciplined enough to pay the credit card balance down to $0 every single month; do not accrue interest or late fees. Only use the credit card if you have the cash to pay for the purchase already.
Focus on these steps:
1.) Earn
2.) Save
3.) Educate
4.) Invest
5.) Repeat (often)
Track & grow the following:
1.) Savings rate
2.) FIRE ratio
3.) Net worth
Your savings rate is determined by your earnings and your spending plan. The “spending plan” has a more positive outlook than the dreadful “budget” word.
The FIRE ratio = monthly passive income / monthly expenses
Some people include their primary residence in the net worth calculation and others (accredited investors) do not. One goal might be to strive for accredited investor status, which is defined by the SEC (google it).
Good luck to you!
Rental Property Investor · Madison, AL · Member since 2018 · 10 posts · 3 votes
7y
@Eric Fitzgerald congrats on graduation!
There are a ton of good suggestions about using apps, but I think your initial success will come from establishing great habits centered around tracking your daily spending. My wife and I weren't good at getting ahead with money until we created a tracking spreadsheet that we updated daily.
My recommendation:
1. Debit not Credit - to start, get good with maintaining a positive checking account balance. Once you build the great habits below, expand into credit card advantages (2% cash back rewards, travel hacking, etc). Be patient, they will soon come if you stay true to these habits.
2. Make a spreadsheet - put your checking account balance in bold at the top of it, then create categories (columns) for various things like income, housing, utilities, auto, medical, groceries, out to eat, fuel, etc. Make the spreadsheet calculate the total value of each column and the either add or subtract those subtotal to/from your balance. At any moment you should know how much you have in that account.
3. Always get a receipt - this is the game changer! Every time you go somewhere and spend use your debit card, get the receipt and shove it in your pocket.
4. Dump your receipts by the computer - this habit makes it easy to input those values into the spreadsheet.
5. Log your expenses - enter those receipts into the spreadsheet and be sure to look at your balance as of that moment. You don't have to memorize your balance but at least have a good idea of whether you are sitting at $1500 or $5 before your next paycheck. As time marches on, that balance will get bigger by the time you are ready to receive your next paycheck.
6. Become/stay humble - you don't need the latest and greatest if you know you have the means to get those things but you would rather build your wealth.
Specialist · Austin, TX · Member since 2016 · 11 posts · 3 votes
7y
Instead of spending starting investing your money safely now. Suggest you check out Lifestyles Unlimited. Tried and true successful Real Estate Investing Education and Networking company.
Structures Engineer · West Hartford, CT · Member since 2015 · 55 posts · 20 votes
7y
One thing I've learned about myself is that no matter how hard I tried, I just couldn't sit down and balance my budget every month. If you're like me, automation can help. I learned this trick while listening to the "Automatic Millionaire" audiobook and loved it ever since. Now all I do is check my expenses once every 6 months or so, and adjust accordingly. Its been working for me for about 2 years and I love it. Here's how I set it up.
Assuming you have your paycheck direct deposited to your primary checking account:
1) open a second checking account, this will be your "escrow account"
2) calculate your total monthly fixed expenses: Investments, housing, loans, insurance, utilities. deposit that as a lump sum into your escrow account. (this is the trickiest part since you'll need to front load the escrow account for this to work)
3) Divide that total amount by the number of paychecks you get per month. Usually 2 per month. This is your "expense per paycheck" amount
4) Set up an automatic transfer to move your expense per paycheck amount to your escrow account. Have this reoccur automatically on your payday.
5) Set up all your automatic withdrawals for each bill to come from your escrow account now instead of your primary account.
The way this works for me now is that on each payday, I don't see the money that is budgeted towards my bills. Whats left in my primary account is free and clear discretionary money that I use for food, bar tabs, hobbies, and filling my gas tank. In addition to having automatic payday deposits into my 401K, this makes for an effective, hands-off budgeting approach.
Good luck, you are at a very exciting stage, enjoy it!