“I feel stuck between choosing my health now and my financial freedom later”: Juggling work, school, and loans – how do I find balance and make the right financial decisions?

Hi Money Minder,

Hey there Money Minder,

I’m currently making around $42,000 a year, working full time while also tackling my first semester of college. It’s a lot on my plate, but it feels really fulfilling because I can actually save money each month for important things like an emergency fund and retirement. However, my situation has shifted, so I might need to dip into student loans (since I receive absolutely no financial aid) to cover living expenses and school costs. I’m also thinking about picking up a part-time gig. Should I save the money I make from the part-time job, or would it be wiser to start paying off those loans straight away? I’m torn between looking out for my health now or securing financial freedom later.

I’m 22 years old, working overnight shifts, and my fixed monthly expenses add up to about $1,150.

Cheers,
Strategic Saver

Response from THE MONEY MINDER:

Hello There,

Based on your current financial situation and the unexpected need for student loans, it makes sense to carefully evaluate your financial strategy moving forward. First and foremost, I want to congratulate you on being proactive about saving money for emergencies and retirement. It shows a great level of financial responsibility at a young age, and that is something to be proud of.

Given your fixed monthly expenses and the potential additional costs from student loans, it seems like a part-time job could be beneficial to help cover these extra expenses. However, it’s essential to create a detailed budget that incorporates all sources of income and expenses to see where you stand. When it comes to the money you make from the part-time position, I suggest taking a balanced approach.

While it’s crucial to start saving and building financial stability for the future, it’s also important to manage your debt effectively. If the student loans have a high-interest rate, it may be wise to prioritize paying them off to avoid accumulating more debt. A good strategy could be to allocate a portion of your part-time income towards savings for emergencies, retirement, and any other financial goals, while dedicating the rest to paying off student loans.

Remember, finding the right balance between securing your financial future and managing current obligations is key. It’s a challenging situation, but with careful planning and smart financial decisions, you can navigate through it successfully. Always consider seeking advice from a financial advisor to get personalized guidance tailored to your specific circumstances.

Take care and best of luck with your studies and financial journey.

Farewell from THE MONEY MINDER.