See What a Frantic Student’s Monthly Budget Looks Like
Breakdown of income and expenses
As she sat there, staring at her dwindling bank account balance, I couldn’t help but wonder, where did all her money go?
I love helping people with their finances and budgets, so when I have free time, I sit down and get them on the right path.
“Lacy”
Lacy is not her real name to protect her privacy.
Lacy is a full-time university student, and she’s from a smaller town outside the city.
She can’t drive home every night, so she has to rent a place and support herself.
Her parents help her a little when she needs it, and she visits some weekends.
Let’s dissect her finances.
Income and Expenses
Lacy has one job, and it’s almost full-time as her classes are online, thanks to the pandemic.
Her work is very accommodating, so she’s lucky.
Income:
$1100 bi-weekly (fluctuates a little).
Expenses:
Rent: $500 — This is a room in someone’s basement yet very affordable.
Groceries: $217
Restaurants: $452 — This includes Starbucks to steakhouses. Anything that is not bought at a grocery store.
Hair, skin and beauty: $117
Transportation: $155 — Public transit and the occasional Uber.
University courses and books: $0 — Her parents pay for this.
Insurance: $0 — She’s in Canada, so she’s covered under her parent’s plan until age 25.
Utilities: $0 — It’s included in her rent.
Cell phone: $0 — Included on her parent’s family plan.
Clothing: $197
Entertainment: $223
Laundry: $15
Debt: $50 payment on an almost maxed-out credit card.
Miscellaneous: $120 — Cash she withdrew from the ATM.
Advice for Lacy
Her rent includes utilities, so at $500, she’s doing fantastic.
Groceries could be fine at $200, depending on what she eats, but her restaurant amount is crazy.
As a rule of thumb, you want to keep your restaurant percentage around 25% of your grocery bill.
If you have a debt to pay off, it should be 0% or close to it.
Her beauty supplies were higher than the typical month.
She keeps her transportation costs low by getting rides from friends when possible.
Lacy did admit she tends to get sucked into clothing sales.
She can control that category as long as she is aware of this.
Since Lacy’s a busy student who works a lot, the entertainment expenses are reasonable.
She enjoys going out once or twice a week when she can.
Her laundry is cheap, and her debt repayment per month is low.
It’s anyone’s guess where the $120 in cash goes, so she must track that in an expense app.
Final Results
Her total expenses are $2046 monthly, and her income is $2200.
She doesn’t always put that extra amount away or on her credit card, so it gets lost in the shuffle and disappears.
I advised her to cut into restaurants, clothing and miscellaneous categories.
She can always cut back on other areas if she would like.
It’s possible to cut out those three areas and save that $1000 for emergencies.
It’s only one month of her life, and it gives her breathing room.
Afterwards, she can limit those categories and use the extra money to pay down her credit card.
It would also give her more freedom to cut her hours so she doesn’t get burned out from school and work.
She mentioned that her parents send her money from time to time to help her out, so she spends more than she claims to.
I advised her to get the expenses app and track everything.
It seems like a lot of work, but it isn’t once you do it for a month.
Remember to track your expenses every night or as you go during the day.
It takes 30 seconds rather than trying to piece together a week at a time.
Also, remember that a budget tells your money where to go rather than wondering where it went.
