The following is a guest post from Martin of Studenomics, where he shows you how to save money in your 20s without missing out on the fun.
“Nobody ever told me that in college.”
I wish that I could attribute this quote to one person. I've heard this from so many readers and friends. There's so much that college will simply never teach us about money. There's a plethora of valuable real world information that we have to figure out on our own. Which is sad, really, because there is a lot to know about money in college.
I'm not here to bash the college system or to go on a rant on the whole academic world. I'm here to open your eyes to a few of the things that you're going to have to figure out on your own.
What are five things that you didn't learn about money in college?
1. You're Not Guaranteed A Job After College
You may not even make any money for a few months after college. There's no guarantee that there's a job waiting for you. Sure, you have qualifications and you're able to look for higher level work. That doesn't mean that you're guaranteed a job. You might not even make the money that you expect to make until much later in your 20s (or your 30s).
You don't have to look far to find articles like this one with some scary stats:
“As of May, the data show 13.8 percent of 18- to 29-year-olds are out of work, an improvement over 14.2 percent in January and over the same time last year, when it was 15.4 percent. The trend is encouraging, but the number is still way above the national jobless rate of 5.4 percent.”
What does this mean?
Try not to rack up too much debt because you're going to struggle to pay it off when you can't find work. I don't want you to get desperate and settle for the first job because you have to catch up with your student loan debt payments.
If you're already in debt and looking for work, then you're going to have to get a little creative because sending off your resume to 20 random postings won't help you.
2. You Won't Always Be Able To Borrow Money
As a student, you get used to borrowing money. The whole concept of student loans spoils you because you assume that you can just borrow more money to solve a problem. When you're in college, you can keep on applying for student loans – heck, you don't even have to have good credit to get Federal student loans. I have friends who funded everything in college with loans (including booze and random trips).
As an adult, you eventually run out of money to borrow. There's only so much credit that will be offered to you. The last thing you want is to be be buried in debt (credit cards and student loans) because you won't even be able to plan for the future.
What does this mean to you?
You're in control of your finances. Nobody's coming to bail you out. Watch your debt because you're going to have to pay this all back. You're also going to eventually run out of money that you can borrow.
3. Your Job Might Not Pay Enough For You To Maintain Your Desire Lifestyle
This one is tough to swallow. You have a desired lifestyle in mind. You might want to eat steak every night and go out on the weekends to the trendiest clubs. You may even just want to be able to buy a new outfit every weekend. Why not? You worked hard and you deserve it, right?
Then suddenly you realize that you have no money left for groceries or for rent. Why? You're not making enough money. There's a big difference between what you want to get and what you're getting.
What can you do about this?
You can try your best to find ways to increase your income. You shouldn't just settle for a low salary. You can increase your worth and make more money. Please don't limit yourself. Increase your income and watch your lifestyle if you want to get ahead in the years after college.
4. Nobody's Going To Force You To Save Money
Your personal life won't have any deadlines or rules. Nobody will ever force you to save money. There are no professors in real life. You don't get reminders and extensions. Your rent is due and that's that. You have to pay your bills. You have to cover that cell phone bill.
You won't have someone nagging you about saving. Nobody will care if you save money.
What can you do about this?
Find a way to save money. You can pay yourself first or force your employer to take money off your check. All that matters is that you save enough to cover your bills because those bills won't magically disappear. I'm not telling you to stay in. You can still party. Just don't spend your rent money on tequila.
5. You're On Your Own When It Comes To Making More Money
You're 100% on your own. Nobody cares if you want more money. Nobody will ever line up to pay you more money. You have to find a way to increase your income if you don't want to remain at the same level for the rest of your 20s.
What's the solution?
The learning doesn't stop when you leave the classroom. You still have to find ways to increase your knowledge and value. You can work on ways to get a raise at work, switch jobs, or freelance on the side.
There's plenty that you have to learn on your own in your 20s. You can learn the hard way or you can apply the tips in this article to save you some stress. We can't rely on college or others to teach us everything that we need to know.
“College wasn’t originally designed to merely be a continuation of high school (but with more binge drinking). In many places, though, that’s what it has become.” — Seth Godin
What lessons did you learn about money in college? Did you miss some of these as well?