After graduating NYU, I stumbled upon a role in consulting for human capital and employee experience. I learned so much about what employers are communicating to their employees today, and also about personal finance. The role really opened my eyes and was the catalyst for how my relationship with money would change — especially as I stepped into the adult world and became financially independent.

In the past, I was always attracted to sales, but now I ask myself, “So what if it’s discounted — do I really need this?” Marie Kondo’s method has been a big influence for me. She talks about how so often we hold onto things because we can’t let go of the monetary value that we paid for them in the first place. But if it’s not adding any value to your current life, don’t force it. Get rid of it if you need to. On the other hand, it’s fine if you want something just because it makes you happy. I love designer handbags and shoes, but I budget for them. If you are the same, then for instance, instead of spending on 10 sale items, use that money for one quality item you’ve been eyeing. Don’t deny yourself anything that you want, just be realistic about your resources!

Of course, in order to be realistic about your resources, or plan for purchases, you have to understand where you are financially. You have to make it easy for yourself to achieve both your short-term goals while contributing to your long-term goals, and make it all automated.
The first way to automate your finances is to get out of debt. If you have student loans, pay those off first.

Then, start saving. If your employer offers a 401K or a contribution plan and a match, make sure you match all of that, because that’s free money they’re giving you. A lot of people think they can’t or shouldn’t contribute too much to their 401K, because their paycheck isn’t that high and they want to have enough for their current lifestyle. But if you’re contributing pre-tax to a 401K, that lowers your taxable income so overall, you’re getting taxed less by the government. For example, if you’re sitting on tax brackets, and starting to earn more in your career as you’re developing, if you’re getting taxed at a higher percentage than you were when you first started your career, a very easy way to lower that tax rate is just to contribute more to your pre-tax accounts like 401K, so your amount of taxable income is a lot lower. You actually save more that way!

Another way to help you save is if you go to specialty doctors like dermatologists, gynecologists, and you need extra funds for the co-pays, tests, treatments, etc — why not contribute to a FSA (flexible spending account)? Again, when you add in pre-tax dollars, it lowers your taxable income and it lowers your expenses pre-tax. That’s money that you’re already going to spend anyway. This way, with some simple planning, tax won’t take a cut, so you end up with more money to spend on those health services! You basically get a chunk taken out every month from your paycheck (pre-tax), but you have access to the full-year funds to that FSA account at the beginning of the year. But do plan accordingly, because if you don’t use it by the end of the year, you lose it!

My other tip is, depending on where you are in your life savings, know what benefits or tools can take the burden off of your out-of-pocket costs. For example, if you’re thinking about buying a home, legal insurance your company offers may actually get you access to a free real estate attorney, so you don’t have to be spending your day-to-day funds on it.

A lot of companies don’t know how to communicate all this legal jargon to their employees — it’s part of the reason I had a job. It’s hard, for millennials especially, to wade through the jargon. What helps is finding if your employer has a hotline or chatbot and ask the agents. You can also google the benefits — there’s tons of articles online. For example, 401ks are still confusing to me, so I’ll find 401k calculators online that tell me “if you contribute this much, it will impact your take-home pay this much.” There are a ton of resources out there, you just have to take the first step to find them.

Finances and money are a taboo topic. A lot of people don’t openly talk about their salary and part of the reason is you may have friends making a lot more or a lot less, so it’s hard to bridge that gap. As long as you have a few friends that you can talk to openly about your salary and general finances, you’re in a good place. It’s not anything to be embarrassed about. It’s good to share so you can empower each other to ask for more money, or just benchmark in general. The other key is not letting other people influence your own spending. You may have friends who are very frivolous or have different starting points. Know what’s realistic for you and budget accordingly. Don’t compare yourself to anyone else — everyone’s financial situation and lifestyle are different.

Half of all Americans live paycheck-to-paycheck. The city is expensive, especially when you’re in your 20s, but once you take that step to get educated on your finances, set goals to pay off your loans, or automate your savings, pat yourself on the back. What you have left to spend at the end of the month, even if it’s not much, it’s yours and yours only!

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