need some financial advice from the wise! How to save $$ in NYC?

Parent Cafe
101

<p>When I was first out of school I had 4 suits, my blue wool interview suit and 3 linen/rayon suits. Each one was worn one day and Friday was mix/match day. I also lived in the snow belt, so the linen suits were cold, but I made do. </p>

<p>Guys have it easier - no one will notice if you wear the same black, navy or charcoal pants 2 days in a row. </p>

<p>Clothes are one thing that you don’t need alot of and they last a long time. As everyone says, shop the sales and you should be OK. (You are in NYC, no one has much closet space!)</p>

102

<p>You have $1255/month after fixed expenses.</p>

<p>I’m being generous but let’s say $25/day for food (truly could get by for less but you might get some food out once in a while). So, that’s $750/month for food. That leaves $505/month.</p>

<p>I would expect you to have to buy incidental items and also to go out a little bit. Figure something for that. </p>

<p>You must have some clothes so far as you are working. Yes, it would take some money to build up a working wardrobe after college. Say you put $200/month toward clothing the first year (and less the next year as now you have a basic working wardrobe). </p>

<p>Then, did you say health insurance is $50/month at your job? Get that. </p>

<p>That still leaves a little bit left. </p>

<p>I’m not saying that saving is not important but it is your first year out of school and you have college loans and some basic first time expenses like a working wardrobe or setting up an apartment. Your salary should rise a bit in the future and you can then start to save. Or save when you can now too. But that would not be a big priority your first year out of school. </p>

<p>Are you saying that no parents or grandparents or relatives EVER give you birthday or Christmas/Hanukah presents? I’m sorry if that is true, though I would find it unusual. </p>

<p>If you rent a van or UHaul to move and ask your friends to do the work, the cost can’t be more than a couple of hundred bucks within the city and you’d save that in one month’s rent at a cheaper apartment. When your lease is up, move to a cheaper apartment share and you’ll have more money for other things.</p>

103

<p>When my H and I first got married, he made 14K and I made 17K, and our studio apartment in NY was $950/mon. We had aroud $800/mon for everything else, and that included paying our student loans $104/,pm for each of us. It is funny how some of those things still stick with you after 30 years. For the first year, our biggest treat every month was to have a bowl of noodles at a fast food place and we did a lot of window shopping. One thing that came to my mind is there was one time we walked into an Italian restaurant for some pasta, only to realize we could only afford one pasta entre, not two. But we were sitting next to James Beard. It was our first year, then we started to make some real money in a very short period of time, and the rest is history. We have been to many great restaurants since then, but that´s one meal we always remember.</p>

<p>My older daughter will be going into finance next July, with sign on bonus, decent salary (little bit better than OP´s) and hopefully with a good bonus at year end. She will most likely spend around 1500 for rent. She has no student loans, and probably will have most of her dinners at work. She is prepared to be self supporting in paying for rent, utilities, food…But more than likely I will continue to pay for most of her clothing and travel to visit us. We probably will continue to pay for her cell phone because she is on our family plan.</p>

<p>D1 spend $400/week on foode and entertainment this summer. She already said to me that it was over the top and she plans on cutting back when she is on her own. My guess would be more around $250 to $300 range.</p>

<p>I told D1 to make sure she pays for her health insurance and put money away in her 401k. HMO is usually a lot cheaper than PPO, even for high deductibles. We told D1 she should try to have 6 months of expenses saved in her account.</p>

<p>I don´t understand the need of buying a piece of real estate, especially for a young person. There has been very little appreciation in the last 10 years, so it´s not a great investment. It´s true that you could get a tax deduction, but your after tax payment could still the same or higher than your rent. There is a huge upfront fee (lawyer, transfer tax, real estate agent) to buy a house ($5K to $15K) that you could never get back. If you need to move because of work, you would be a lot less mobil with a house to get rid of.</p>

<p>Don´t move out to anywhere where there is no public transportation. The rent maybe lowere, but you would then need a car. Commuting costs from the burb could be a lot higher than some rent around NYC. Moving out to Jersey City, Hoboken or 5 boroughs of NY may make sense (as long as there is a subway), but anywhere else your costs would actually go up.</p>

<p>We do tell our daughter to buy good quality food, and it may mean shopping at whole food. It is cheaper to buy a good quality steak and organic vegetable to eat at home, than to eat out. </p>

<p>When it comes to clothing, I would suggest for you to buy only 2 suits and different shirts, but buy good quality. Each year, you just add on to your wardrobe. Don´t send your shirts out for laundry. They tend to be very hard on your shirts. With shoes, buy 2 pairs too, and alternate them because they will last longer, especially if you sweat a lot.</p>

<p>Don´t worry about not saving money now. Worry about making money if that´s important to you. As long as your income keeps on going up and your expenses stay the same, then you´ll be fine.</p>

<p>One thing a new graduate could do to pay less tax upfront is to declare higher number of deductions. Most people start working in June or July, so they only earn 50% salary for the year, but when determining taxable income the payroll annualize it. My daughter put down 10 deductibles this summer, her take home was higher than other people, but she also won´t get as much of a refund this year either (money upfront is always better than later).</p>

104

<p>"Are you saying that no parents or grandparents or relatives EVER give you birthday or Christmas/Hanukah presents? I’m sorry if that is true, though I would find it unusual. "</p>

<p>Unfortunately. :<</p>

<p>"If you rent a van or UHaul to move and ask your friends to do the work, the cost can’t be more than a couple of hundred bucks within the city and you’d save that in one month’s rent at a cheaper apartment. When your lease is up, move to a cheaper apartment share and you’ll have more money for other things. "</p>

<p>I think this is what I am going to do.</p>

<p>"Then, did you say health insurance is $50/month at your job? Get that. "</p>

<p>It costs a bit more than this, but I think I’ll have to figure out a way to opt into only the things I may need at this point (health and dental mainly)</p>

<p>I currently own three shirts and four dress shirts that I mix and match, although two of my suits are slightly stained (both from completely unlucky and unrelated incidents in subways when I’ve had things spilled on me) and I have to find to get them removed.</p>

105

<p>NYCFLUX- Please don’t take this in the wrong way but were you an international student? I’m asking this for the very simple reason that you seem to really be glossing over the issue of Health Insurance. Based on the fact that you seem to suggest that you don’t have a family support network that perhaps you are indeed an international.</p>

<p>If you are, and on an OPT or H1-B visa please, please, please listen to me on this one…get insurance. As a young person you may say “I’m healthy” but healthy people have accidents just as easily as sick people do. I asked if you were international as you may not fully understand that there is not really a safety net like there may be in other countries. </p>

<p>Things could snowball when you least expect it…you get sick but you don’t get something taken care of because you lack insurance, so it gets worse, then you have a bigger problem…you have to miss work because your condition worsens…you lose your job…and bam now you have an immigration issue…</p>

<p>Are you also factoring into the equation that health insurance is pre-tax so you don’t actually end up paying the full amount, you pay the tax adjusted amount.</p>

<p>I don’t wish to make assumptions but you seem to be choosing not to listen to what people are trying to tell you…who cares about your shirts and suits…if they are clean and not worn they don’t have to be bespoke. People have given you good suggestions on how to reduce your housing and food bills but you just come up with excuses…</p>

<p>Look it would be great to be able to live a high flying lifestyle in NYC but heh an Ivy Education doesn’t always equate to wealth. Get used to it. If you thought going to an Ivy would be your ticket to the big time, well sorry you got sold on that dream. </p>

<p>Unfortunately no one on CC is able to manufacture more money for you. I think by now you have some good advice to go forth with. If you want to disregard it and whine…well then i refer you to the “say it hear cuz you can’t say it anywhere else” complainer thread.</p>

106

<p>No, I’m a white male – born here in America. I gloss over Health Insurance because I cannot afford it yet and I’ve never had it growing up.</p>

<p>I care about my shirt and suits because I only have a couple of each – half of which need cleaning. </p>

<p>I’m not trying to make excuses – I just have a hard time accepting this sort of advice that is basically “Buy it anyway” – if I could do that, I would. I admit my rent is probably too high but I needed roommates and the only people I knew were those who were moving at the same time I was were a few friends of mine (also Ivy). I figured it was reasonably priced, but I’m just finding that expenses are ultimately tighter than I anticipated. </p>

<p>The problem is that I need hard figures for what to reasonably expect. I have no idea what most people pay each month to eat well and be healthy. I have no idea what most people spend on clothes. I don’t know if $200 is too much, $100, etc.</p>

107

<p>savings vs health insurance</p>

<p>both are protection against risk (there are other reasons to save, but right now you dont need to build up a down payment for a house, etc, you are saving in case you lose your job). Right now you hear more about people losing their jobs, than about young people getting sick, cause of the economy. We do not your company, what sector it is in, how well they like you, or what the opportunities you would have if you had to get a new job. I think most of us probably think that even if the odds of losing a job are higher than those of getting a catastrophic illness, the consequences of doing the latter while uninsured are far higher than those of losing a job without much savings. Ergo, we are suggesting that as a hedge against risk, health insurance is a higher priority than savings. But you may be in a position where that is different, for example if you were in a field/sector where layoffs seemed imminent. We do not have the info to answer that.</p>

108

<p>On the question of savings vs. health insurance – you can have both, by getting a HSA plan – that’s a high deductible plan tied to a savings account – you get reduced premiums, plus a bank account that you can use as a hedge to meet your deductible, or to build savings during times that you are not spending money for medical costs. An added advantage is that you can use money in the HSA account to pay for medical costs that are not covered by insurance – for example, an elective medical procedure or dental costs, even though you don’t have dental insurance.</p>

<p>And as to overall cost of living:</p>

<p>My d. is living quite comfortably in NY – shared housing – on a salary of less than $40K. (Her share of rent is roughly $500 - living in Washington Heights). However, her job does provide health insurance – and that was a big priority in the job hunt. I find it rather appalling that a position with a $62K salary doesn’t provide insurance – the OP would be a lot better off with a $55K job + health insurance. (He’d have insurance, and the reduced pay check would force him to live within his means).</p>

109

<p>

</p>

<p>NYCFlux, I feel that I did give you an approx. budget for food, clothing, etc. for this year (and health insurance) in post 102. </p>

<p>Here is another point of reference…I go food shopping once/week (and we earn more than you) and for TWO people, I spend approx. $200/week. We also tend to eat dinner out once/week which is not a part of that figure. You are ONE person. I gave you a budget of $175/week for food (groceries and eating out) which I think is ample and I KNOW can be done in NYC. Not to mention…I eat more expensive food than you need to be doing…like tonight we are eating filet mignon. My D who is your age and lives in NYC spends less on food than you do and makes much less money than you do (she also doesn’t eat steak). You seem to be spending $300/week on food.</p>

<p>PS, by the way, my husband, a professional with “Dr” in front of his name, has packed his lunch for work every day since I have known him. :D</p>

110

<p>Sorry, I must have misspoken earlier. I am not spending $300/week on food – that would murder me, haha. I am estimating a rough $300/month on food (~5-10 per day plus an occasional over-step here and there) currently. That means each month I gain 1200-300 = maybe 900 dollars.</p>

<p>The problem is that I feel that even 5-10 dollars each day is probably too much. I am not sure that only gaining 800-900 each month is safe – and this is without insurance. With insurance, this amount might be even lower, and if I were to put more towards my loans, even lower than that (if I were to double pay loans and pay insurance I might have an additional 200-300 each month, and here in NYC that doesn’t give you a whole lot to spend over the course of a month on clothes/entertainment/etc). </p>

<p>Post 102 quotes figures that are already far above what I am spending currently. There’s no way I could spend 750/month on food, and insurance was not $50/month (it was like 150-250 or something along those lines).</p>

111

<p>Now, I am really confused. You say that “gaining 8-900 a month may not be safe”…what do you mean? You don’t have to GAIN money per month. You just have to live within your means and if it is possible to save, great. There is no way you need to be saving 800 per month right now fresh out of college given your expenses and college loans and so on. </p>

<p>Now, you say $300/month for food is too much or that $5-10 per day for food is too much. Frankly ,that is too little. My kid makes a lot less than you and can’t feed herself on $5-10/day. I think you would need at least $15/day. That still leaves you quite a bit of money left over. That leaves enough for some entertainment, some clothing, and some health insurance. This is all out of $1255/month. It doesn’t seem too difficult. You still have more money than my kid has. She isn’t paying for college loans or health insurance, however.</p>

112

<p>It really sounds like you’re doing fine, but I still think you need at least minimal health insurance. Millions of Americans live paycheck to paycheck. It’s generally not a great idea, but understandable for a recent graduate just starting out.</p>

113

<p>soozievt: To me this doesn’t compute – I feel like everyone around me is somehow able to pull thousands out of absolutely nowhere, be it spending a few hundred or more in a month on drinks or a few thousand there on a vacation or paying a large chunk up-front for rent/security deposits, etc. I can’t imagine how they’d be able to afford this unless they’ve been saving a decent amount each month. Or am I underestimating how much parental support my peers are possibly getting?</p>

<p>"Millions of Americans live paycheck to paycheck. It’s generally not a great idea, but understandable for a recent graduate just starting out. "</p>

<p>I suppose this is my fear. I don’t want to live paycheck to paycheck. If something goes wrong, I’m totally screwed. I don’t have family to go to, nor do I have a school to fall back on since I’ve graduated. I have to save up to afford a possible scenario where I may need to find new work under a worst-case scenario.</p>

114

<p>NYCFlux, your posts sound too familiar…are you legendofmax?</p>

115

<p>NYCFlux…a few things…</p>

<p>One…you may be hanging around people who either earn more than you or are subsidized by wealthy parents, etc. You can’t measure yourself against them. As I wrote, my kid makes far less than you but so do most of her friends starting out of college in her field. They all have tight budgets. However, a FEW of her friends are wealthy where their parents still pay for stuff or something of that sort. She knows she is not them and that’s fine. But most of her pals are in a similar situation to herself. </p>

<p>She doesn’t have a few thousand for a vacation. She doesn’t spend a few hundred per month on drinks but she definitely goes out (she is seeing a friend’s show tonight, but it doesn’t cost much). </p>

<p>I imagine you already paid a security deposit which means you’ll have it back for the next place you rent. </p>

<p>You likely could save 150/month if you wanted to and still have enough for food and to go out (it is not all or nothing) and get health insurance. You make more money than many recent grads. Try not to measure yourself against a certain crowd that is not in your bracket. </p>

<p>Also, as it is your first year out, you have to be patient when it comes to saving and to accruing a work wardrobe and so on. You are in a better situation than most, but you see it differently, I believe, as you either want it all now the first year out (saving for a home, etc.) or have friends who are better off than you.</p>

116

<p>cbreeze…does it really matter if it is? The OP is asking for help so there is point in asking him that.</p>

117

<p>" If something goes wrong, I’m totally screwed. I don’t have family to go to, nor do I have a school to fall back on since I’ve graduated. I have to save up to afford a possible scenario where I may need to find new work under a worst-case scenario."</p>

<p>You wrote that you have an understanding girlfriend. Just pretend you’re an actor or musician and sponge off of her for a while.</p>

118

<p>mommathree…thanks for the rebuke. I see it really sets you off. Is the OP really asking for help after 116 posts?</p>

119

<p>soozievt: Yes, I will get the deposit back when I move out. I also believe it earns interest over the year, at that.</p>

<p>I guess I am confused about what the accounts look like for most people because from what you’re saying, an increase of 150-250 is acceptable – this, to me, boggles my mind. I can’t imagine that someone would have an account with X dollars in October 2010 but only X+12*250 in October 2011. Am I being overly hard on myself? Am I underestimating how much I need to be saving in this economy?</p>

<p>cbreeze: If you have to know – yes, I am. I made the new name for a reason (primarily, humiliation/embarrassment) – I really would have appreciated a PM instead. And yes, I am asking for advice. You have to understand that while a lot of this stuff may be common sense/basic to you, it’s not something I’m well-acquainted with.</p>

120

<p>"You wrote that you have an understanding girlfriend. Just pretend you’re an actor or musician and sponge off of her for a while. "</p>

<p>Haha, I don’t think she’d appreciate that very much. XD</p>