Once I started tracking my spending, I didn’t think there was much else to money management. After all, my debt was going down and my savings were going up—so everything looked right to me!
As time went on, though, I realized I was making mistakes with my budget … and I didn’t even know it. Here are five of these common mistakes. Check them out to see if they’re holding you back from reaching your financial goals.
This post’s title probably got your attention, right?
Well, OK, I don’t have a magical way to turn the $25 in your bank account into $150,000 immediately. However, I do have a way for you to make that happen eventually: begin saving for retirement—now instead of later.
Time is on your side.
After my exhausting and stressful internship hunt, I finally found the right one: a 12-month full-time role at a tech company that used both my bachelor’s degree in chemistry and my MBA.
After two rounds of interviews, the company narrowed their selection down to me and one other candidate. Going into the last interview for this dream internship, I felt confident. In fact, I felt so confident that I turned down an offer from another firm.
You can imagine my disappointment when I lost the position to the other candidate.
As I’m just wrapping up the first year of my MBA, I’m looking forward to the 4-month break of summer vacation before hitting the books again in the fall. Even more than relaxing from my studies, I’m looking forward to bringing in some income through a paid summer internship.
Having already put in a few years of professional work experience, I thought I had finding the right internship under control, but I’m a little embarrassed to admit I made some major mistakes in my search. Here are the three biggest ones, so you can avoid making them yourself!
When I filed my taxes this year, I expected to get an income tax refund in excess of $5,000. As an MBA student with a huge tuition bill and a year’s worth of tax-deductible contributions to my retirement accounts, I was sure I had enough credits to produce a sizeable return. I was planning to spend it on plane tickets to South America, then shuffle the leftovers into savings for next year’s MBA course fees. I was even going to let myself take $300 on a mini shopping spree. You can imagine my disappointment when I received less than 25% of what I was expecting.
Certain expenses seem to exist in an untouchable sphere. They sneak under the labels of “necessity” and “fixed cost”—even when we adamantly reduce our spending everywhere else.
For me, yoga is one of these spending blind spots. And after realizing I’ve already spent more than $500 on yoga classes and workout gear this year, I’m not feeling too zen about it.
I’m a huge advocate for managing your finances independently. I think the sooner you can break off from support from parents or reliance on credit cards and loans, the better off you’ll be.
However, sometimes there’s just not enough money to make ends meet—especially if you’re in grad school like I am. In grad school, you have to watch every penny to survive, and even then, you may still run out of money.
Fortunately, if that happens, one of these three options could help you.
I graduated with $21,000 of student loan debt—but that number is not even close to how much my postsecondary education cost.
If you add up the tuition, fees, and textbooks for my bachelor’s degree and MBA, you’d come up with an amount closer to $100,000. I could have graduated owing that much in student loans. In fact, if I had done a few things differently, I definitely would have owed that much.
As we talked about before, now is the time of the year to be looking back and forward at our financial habits. And the more I study my money, the more I realize that I inherited most of my money habits, both good and bad, from my parents.
I had some pretty big goals for 2013—financially and otherwise. But by taking time at the beginning of the year to figure out where I wanted to be at the end of 2013, I achieved them.
In addition to paying off nearly $21,000 of student loans from my undergraduate degree, I also quit my job of 2 years, moved, and went back to school for an MBA. Talk about a year of big changes for in money and lifestyle!
Here’s what I accomplished, as well as my plans for 2014.