When I first considered starting a blog, getting a perspective on finances from a variety of people was always something I wanted to do. So, when Cash Fasting launched Fall 2016, I started the Two Cents series, which highlighted how young professionals around the country were handling a transition into a working life, their finances, and life in general. One of the first interviewees back in 2016 was my close friend, Alice. She’s a meal-prep pro, but, like me, occasionally struggles with food spending. Well, now that she’s a little bit older, a little bit wiser, and in a very different place compared to 2016, let’s see how things have changed.
In your first guest post, you were living/working in Northern Virginia with plans to move to Boston. Where are you now, and what’s your financial situation like?
I did it! I found a job in Boston at a tech startup and moved up on the first day of 2017. During the last year and a half, I’ve maxed out my retirement contributions, started investing the leftovers, got a new credit card, and re-adjusted my budget to reflect a new life view.
What is your budget like now? What expenses did you not expect a year ago?
My income has increased significantly with my move (almost 50%!), and I’m still focusing on a similar set of priorities as I did last time around, but with a few additions. I make sure I have enough money for the important items, and then whatever money I have leftover, I trickle down to what I would like to have money for but don’t require it. That list is as follows:
- Rent/utilities
- Groceries/everyday expenditures
- Gym membership/fitness costs
- Going out/transportation
- Retirement/savings
- Investing
- Travel
I knew with the move that I’d have to rent, so that wasn’t a surprise. What was a surprise was my inclination to travel. I previously never really thought about traveling a lot, so that came out of nowhere. Thinking about it, I only just now have what I consider a good amount of resources available to be able to travel. It’s not the highest priority, as you can tell, but it’s definitely a category I never thought too much on before.
Has your perspective on money changed at all in the past year?
It has. Previously, I was saving because I knew that it was a good mentality to have towards life, which meant that I would always have an enjoyable and affordable standard of living, and also that my future would be less stressful with more available funds. Now, I try to view money as a tool to use. I don’t go out multiple times a week recklessly, but I won’t feel bad about buying lunch if I didn’t have time to prepare a meal beforehand (like I would have previously). It’s a little hard reconciling the two viewpoints together, but I’m lucky enough to have a flexible enough budget to weather any small bumps that do come my way.
A year ago, your long-term financial goal was to afford a down payment. Is this still a goal? What’s changed?
Since I moved to Boston, I’ve looked at the properties around here and thought about buying my first property. Then I realized that the housing market in Boston is ridiculous. I’m not completely sure whether I want to live in Boston forever, but with the prices of homes here I need to be absolutely sure before I commit, and I’m not. I still want to buy a home someday, but it’s a lot less urgent while I’m still in Boston. So my long-term goals are still there, but it’s on the back burner.
What are your current short-term financial goals?
My current short-term financial goals? I haven’t thought too much of this. I think the next step for me is further education. I’m maxing out my 401(k) and my Roth IRA, but I’m really not too educated on the investing side of it. I have my money sitting in an investment account, but I could probably do something better in the future. So, my short-term goal is a little research, but that’s been my short term goal for over a year now.
Given your current trajectory, what do you see yourself achieving in the next few years? What changes in the past year have set you on this course?
Saving up for a home is my next big thing, but in the meanwhile, I have so many trips planned and travel that I want to do. So, it’s the same as before but now account for travel. And I’m still saving as before, so aside from any bad bumps in the road, I don’t foresee any problems.
What advice, if any, would you have given yourself a year ago?
I’m actually pretty happy with where I am now, and my attitude towards spending and saving is still about the same, travel aside.
What would you challenge Cash Fasting readers to do to be more financially successful?
Asking themselves what they’re saving up for, and what sort of lifestyle they want in the future, and to prepare for any surprises. Right now, I’m happy with my current life and could see myself living like this for many years, but I never forget that the entire reason why I’m saving is to have an easier future, whether it be an emergency or just general life changes.
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Alice and I are both still young, so there’s a huge advantage for us in growing our savings as well as our income. Congrats to Alice on increasing her salary by 50% in such a short time! That’s an uncommon feat and something to be celebrated. Whether you’re new to the workforce or have been working for multiple years, the one consistent thing I’ve seen is just how much finances can change in a single year. Setting financial goals (both short and long-term) can be the motivation needed to make a lasting change.
Want to read more Two Cents? You can find a list of all interviews here.