It’s 2020, so we are getting real! To kick off the first post of the new year, I wanted to begin with a topic that would otherwise make some folks uncomfortable: money! I realize that a lot of people do not like to discuss finances. In an effort to remove stigma around money talks, I thought I’d share the unique financial challenges I faced within the last year. My biggest? It was learning to live on less than $1,000 a month.
I developed very good money habits from my days as an undergraduate student. Although my parents did a pretty good job of teaching me lessons like never carrying a balance on a credit card, a lot of what I learned was through self-education.
Much of my financial woes occurred during the ending of my Master’s Program. It was also a time when I also experienced serious post-grad stress. I spent all of last year on unstable income. I was living mostly paycheck to paycheck on a measly stipend paid monthly. It was NOT easy. But, I still managed to make my money work for me. My everyday reality became learning to live on less than $1,000 a month. How this all happened…is honestly a miracle. There is no doubt in my mind that God was alongside me during that season, and with lessons that followed.
I never automated major bills
By paying my debts as soon as I got paid, I became more disciplined with money. The thought of penalty fees, accruing interest or negatively impacting my credit score or financial health was enough to keep me on track. I do not use autopay for major bills. Manually paying for my bills helps me to track my money and it encourages me to pay more towards debt when I can.
It can get really easy to forget how much you still owe when you’re not actively checking your statements. I never missed a car, dental, or credit card payment while living on less. My credit card utilization has been well under 10%, and I still make sure to pay the balance in full every month and on time. I currently maintain one credit card and will look into another one with rewards once I feel ready to do so.
I also managed to pay off all of my dental bills in less than one year. This was done by following my dentist’ office’s payment plan and paying a little more each month when I had extra funds from my side gig as a substitute teacher. I finished the last payment in June of last year. The “no automation” method also helped me to pay off my undergraduate loans a few years ago. I definitely look forward to tackling my graduate school loans and the small car loan I have left with this method.
I never paid for convenience
Convenience is expensive. This is especially true when you’re broke! Being tight on funds meant learning how to sacrifice. For upcoming events, I prioritized expenses for them in advance. For example, I attended an annual conference for my profession last November. To cut down on travel arrangements, I found a cheap (and cozy!) Airbnb a few miles away from the conference location instead of a hotel that was located on-site. Last summer, I started an early search for a place to stay. I knew that the cheapest options would book the fastest. I didn’t have the luxury of hotel service and being close to everything. But I saved nearly $400 in hotel fees by getting an Airbnb.
The “no paying for convenience” rule was applied to other tasks. I would easily take the free shuttle to work if it meant not having to pay for parking nearby. I could take the time to cook meals for the week if it didn’t mean buying lunch all of the time. And I could whip up my own haircare recipes if it meant not blowing money at Target or Sally’s. If I could learn to do something myself, I would try. And it saved me money.
Even with the little I had, I always had food to eat
I didn’t buy my produce from Kroger, Publix, Whole Foods, and rarely did I buy produce from Sprouts (unless it was on sale). I am pretty fortunate to live in a well-populated, diverse area where I can find my groceries for the low. International farmers’ markets were and are still my go-to places because I knew I can find the cheapest deals there. For example, I could spend around $2 on 1 pound of jalapenos! Bulking on foods for less meant that I could stretch my money. I didn’t have to shop for groceries every week. I could buy enough items to last me for the next week. When I did visit places like Sprouts, Walmart, or Kroger, I stuck to an “essentials” list. This includes items such as almond milk and pantry items such as oatmeal and canned beans. Despite the lack of money flow, I still had food on the table! If you would like more tips on grocery shopping on a budget, check out my plant-based guide.
Having little money means learning to say “no”
I drastically reduced my expenses by saying “no”. I still live with my parents, which means no rental payments. And if I couldn’t afford to do something, I just wouldn’t do it. My little income also reinforced the importance of delayed gratification. I wasn’t spending money to travel far and wide and rarely did I go shopping for new clothes. Seriously, your girl can create a whole outfit from Goodwill for under $20. In the photos of me on this post, the jeans and sweater were thrifted for a whopping total of $14.
Living on less also meant eventually giving up some of the few self-care habits that I had going. During the latter half of 2019, I stopped getting my nails done. It was definitely a bummer because it was my only inexpensive luxury (courtesy of my amazing nail tech). However, I wanted to further minimize expenses as I searched for full-time work. I decided that the only self-care habit that I could financially commit to was going to the gym regularly. In fact, my “biggest” financial purchase of 2019 was an Apple Watch to use for the gym. I purchased it at Target for $200. That sacrifice was worthwhile because I’m now in the gym about 4-5 times a week.
Having little money means learning how to be resourceful (I took on a side gig)
I took up a job as a substitute teacher just so that I could have extra money to get by. That money paid for my yearly website hosting fee last month. The funds also came in handy for the holidays. I could afford to purchase Christmas gifts! I was overwhelmed to find that the items I purchased were all within my budget. To reduce excess spending on gift bags or gift-wrapping services, I took the time to watch YouTube videos to teach myself how to meticulously wrap a gift. I then went to Dollar Tree and picked up wrapping paper and assorted gift wrap bows for a total of $2-$3. Again, I wasn’t paying for convenience!
Two months ago, your girl became fully employed after nearly 11 months of job searching. Although circumstances have changed, I still want to use the lessons learned from living on less to maximize my pockets. I am also looking into other streams of income. There’s definitely more to this part of the story, but we’ll reserve that testimony for another post.
Whether you are living on less than $1,000 a month as I did, have a little less or a little more, you can learn to make your money work for you. Having healthy financial habits is incredibly empowering. What are your tips?