Hi Money Minder,
I’m 23 and bringing in $90,000 a year, but I’ve got $27,000 in student loan debt hanging over my head. Planning to move out of my parents’ place into a $1,500 a month apartment soon. I tried chatting with my folks about money stuff, but my mom just shrugged it off. They’re not exactly money experts, so I get it, but now I’m totally lost on if I’m on the right track or how to handle my finances going forward. Did I make a mistake signing that lease? Any tips on budgeting for the future? Am I doing okay? I’m basically starting from square one financially, so any insights you could offer would really help. Thanks a bunch!
- Financially Challenged Seeker
Farewell,
Response from THE MONEY MINDER:
Hello There,
Dear Concerned Individual,
Firstly, I want to recognize the courage you have shown in reaching out for financial advice. It’s a big step towards taking control of your finances. I can understand the uncertainty and anxiety you may be feeling as you navigate this transition into independent living and financial responsibility.
Based on the details you’ve provided, including your income, student loan debt, and anticipated monthly expenses, it seems like you are in a reasonable financial position. However, moving into an apartment that costs $1,500 a month in an expensive city can be a significant portion of your income. It’s always ideal to aim for your housing costs to be around 30% of your income, but this can vary depending on your situation.
Considering your starting point and the fact that you have student loan debt, it may be beneficial to create a comprehensive budget. Start by outlining your monthly income and all your expenses, including rent, utilities, groceries, transportation, student loan payments, and any other necessary expenditures. This will give you a clear picture of where your money is going and where you might be able to make adjustments.
Additionally, it’s essential to have an emergency fund for unexpected expenses. Aim to set aside a portion of your income each month into a dedicated savings account until you have built up at least three to six months’ worth of living expenses.
Seek out resources such as financial literacy classes, online budgeting tools, or financial advisors who can provide personalized guidance based on your specific circumstances. It might also be helpful to explore ways to increase your income, whether through side hustles, career advancement, or additional education.
Remember, financial stability is a journey, and it’s okay to make mistakes along the way. The key is to be proactive, stay informed, and make informed decisions about your money. You are taking the right steps by seeking advice, and I believe that with dedication and perseverance, you can achieve your financial goals.
Best of luck on your journey towards financial well-being!
Farewell from THE MONEY MINDER.
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