The money didn’t last long: Though my mom helped me move to Dayton, which kept the move itself relatively cheap, I’d never owned furniture (it was always included in the rentals I had during college), so I spent more than $5,000 furnishing my new apartment from scratch, including $2,000 on a bed and mattress and $1,000 on a sofa. I needed a car to get around, and though I put down $5,000 (earned during my summer internship), and my parents and grandparents contributed another $5,000, I still had to take out a $12,000 loan.
How My New Job Landed Me in Debt
One of my biggest post-grad-school expenses was clothing. Even as a junior lawyer, I had to look professional—I knew from interacting with lawyers during my internships that cheap shoes and suits wouldn’t cut it if I wanted to get ahead. Though I didn’t keep a close tally, I’d estimate that I spent $7,000 or so on my initial wardrobe. Some of my suits were from Banana Republic and J.Crew, and cost several hundred dollars each, but I bought a few thousand-dollar department store suits too, and splurged on an Alexander Wang purse that set me back about $600.
“I bought a few thousand-dollar department store suits, and splurged on an Alexander Wang purse that set me back about $600.”
To try to keep a balance, I purchased some pants at thrift stores, and scoured T.J. Maxx for collared shirts and shoes. I also bought nicer casual items—sweaters, pants and shirts—to wear outside of work, too, because if I run into a colleague on the weekend, I don’t want to be wearing cheap or worn-out outfits. I’ll admit: Nice clothes make me feel better about myself, and reinforce the idea that I’m not a college student anymore, so in that respect, it’s worth it to me.
My salary wasn’t enough to cover all of the costs of the clothes and furniture, so I managed to ring up $5,500 in credit card debt. Between trying to pay down my credit cards, as well making my monthly car payment and payments toward the $176,000 I have in school loans, I only saved a thousand dollars over the course of a year.
The Hard Money Lessons I Learned
There are times when I think about what I owe (and what I haven’t saved) and panic, but in truth, a lot of my expenses were unavoidable—it’s not like I took out a credit card and went to Vegas. It was an investment, and I will probably never need to buy that much clothing or furniture at one time ever again.
Plus, I’ve learned a ton since getting my first “grown-up job” a year ago. For example, I initially found myself gravitating toward the very nicest clothing—think suits and dresses at Nordstrom and Bergdorf Goodman. But I soon realized there was a disparity between what I wanted to wear and what I could afford to wear (and that there were many nice middle-range options available to me too—for example, J.Crew suits).
I also changed the way I think about my salary and savings. Though I earn several thousand dollars each month, I now know that I don’t get to automatically spend it all, like I would have when I was in my teens or early 20s and had no debt or living expenses. My new strategy is to pay my bills, including my credit cards; save at least several hundred dollars; then give myself several hundred for expendables.
When I first moved to Ohio, I didn’t really know anyone, so I’d spend many weekends traveling, either to explore new places or see friends and family. Even if I drove, it could add up to $600 or $700 a weekend. Now I don’t travel unless I’ve saved up for it and it doesn’t impact my ability to meet all of the other financial goals I’ve set for myself.
How I’m Saving for My Future
Now that I’ve been a working professional for a year, I’ve set new goals for myself. I put aside $900 a month for savings, with the understanding that I can use that money in the event of an emergency, but not for, say, a new outfit. I also upped the amount that I’m paying on my student loans, chipping in a few hundred more than the minimum. My current goal is to pay down my credit card debt by the end of the year, so I’m in a place where I’m only paying recurring bills like rent and utilities; with what I’m earning, I should be able to do this by the end of 2013, or at the very beginning of 2014.
I know that having a healthy savings account will help me achieve my career goals faster. To be honest, I don’t know exactly what I want to do five to ten years from now, but I’m pretty sure I’d like to live in a bigger city, which will inevitably cost more money than living in Dayton. Plus, I’d like the ability to take a job outside a big firm—for example, an in-house counsel position or a position in the real estate industry, which has always interested me. No matter what I decide, it’ll take money. Not because I’ll be able to afford the snappy Donna Karan suit I’ve been eyeing—but because I’ll have the financial freedom to make the choices that mean the most to me.
*Name has been changed.