I am a huge fan of your blog! I have been offered a job working on the Hill. I am very excited, but also very nervous.
I was blessed to have parents pay for my private college education, as well as all my living expenses. I have developed somewhat of an expensive living habit. I’m ashamed to say, and I know this will get flack from commenters, but I do not know the value of a dollar. I know my parents will help me out, but I want to be independent and stand on my own two feet.
How did you afford rent, groceries, going out, and fabulous clothes on such a meager salary? I’ll be graduating college with zero debt and no loans…I want it to stay that way.
Riches to Rags
The truth is that I didn’t stand on my own two feet at first. When I finished grad school, I was drowning in student loan debt. At one point, my monthly payment was more than my rent. So I took a weekend job at a tanning salon, but it was about as glamorous as it was lucrative. So my Father, in his infinite generosity, supplemented my income.
I didn’t live well, but I did have a comfortable apartment, food to eat and I didn’t worry about keeping the lights turned on. But a lot of staffers aren’t so lucky, especially male staffers. So here are some tips on how to save money, to make your meager income go further:
Know What You’re Earning: You need to know what you will be making after taxes, not your gross salary. Visit Paycheck City, to make those calculations. You’ll also want to deduct about $100 from that number for your contribution to health and life insurance.
Take Advantage of Perks. The House and Senate offer Metro benefits to cover the cost of taking the subway to work. If it’s feasible, even if you have a car, train to work to save money on gas. Unless, of course, you can save significantly on rent by living off the Metro line.
Also, even though you don’t need it, the House and Senate offer student loan repayment benefits to some employees. There is a maximum payment of $833 per month, and you need to pay taxes on the money as if it were salary. But the amount you receive, if you receive any at all, is up to your individual office.
Housing. Most financial advisors recommend that rent + utilities should cost no more than 33% of your net salary. Usually, the only way to make that workable on the Hill is to find a group house or a roommate. If you went to school in D.C., some of your friends might be sticking around, I’d look into living with them. Living alone is just too expensive for most junior staffers to swing.
Save on Food. When I was a young staffer, I partnered with some of my neighbors to go bulk shopping. We’d go to Costco, buy huge portions of meat, cheese, crackers, etc., and then we’d split the products and the bill. I also clipped coupons and compared prices on everything.
Many young staffers pack lunches. Others, like me, buy lunch and then eat cereal for dinner. But spending $10 a day on lunch can eat up your paycheck fast.
Find More Work. I know a lot of staffers who have second jobs. Some bartend or waitress, others work retail and a lot of staffers babysit. But anything that you can do to make extra money on the side is something that you should consider.
Don’t Fall Into the Trap. Some of the staffers who hacked it out on their own, scrimping and saving, will be upset that you speak openly about being fortunate. I appreciate that you want to make it on your own, and frankly, I think that being responsible for your own financial security will help you grow as a person. And you’re blessed that you don’t have any debts to cover, so keep it that way.
Many new graduates finish college, enter the working world and immediately start trying to keep up with the Joneses. So they live on credit, but debt is a shackle. Once you have more debt than you can easily pay off, your life revolves around keeping up with your obligations.
Most young staffers live on less than $30k per year in a very expensive city. So it can be done. It may not be comfortable or pretty, but it can be done. The good news is that it doesn’t last forever, and learning how to take care of yourself and live on what you earn is a rite of passage that will serve you well whether you make $27k or $80k.
One Last Thing. If you decide that you do want some help from your parents, ask for a set amount of money every month. Just asking for money when you need it isn’t going to teach you how to work a budget. And having an “emergency” credit card seems like a good idea until shoes and dinners at nice restaurants start to look like emergencies.
So sit down, figure out a number and only accept that amount in cash. At least you’ll be learning how to live within a certain budget without the ability to charge whatever you want on a credit card.
Try not to be too hard on this girl. It isn’t a crime that she was lucky enough to have an enviable college experience, and it shows a lot of character that she wants to make it on her own. So if you have some tips for her, or the other new staffers who may read this post, on how to save money and get by on a junior staffer paycheck, leave them in the comments.