Entering the Real World: Economics 101

From The ESMS Intern’s Desk

Bianca’s Perspective:

Cynthia took the time to review an income budget to prepare us for post-graduation life. This especially pertained to me, as I will be graduating in less than 2 months!  We estimated an annual income for an entry level position, $35,000, as well as the expenses monthly/annually for living on our own with roommates.  After deciphering how much we would spend on rent, insurance, groceries, phone bill, etc., the income versus expenses almost broke even! We also took into consideration tax deductions and 401k contribution.  On top of the annual expenses, I will also have a good amount in student loans to pay off!  I don’t want to accumulate too much interest, so I hope to pay off my loans as soon as I can.  My loans will set me back in saving my income for a year or two, but if I live at home, it would greatly help me!

Going over this mock budget really opened my eyes to what kind of money I will be spending when I am out in the real world living on my own. A starting income of $35,000 seems like a lot to me right now because I don’t have any money, but when I will have to pay for the expenses of living on my own, it will be barely enough to get me by!  I have been planning on living at home for a year or so when I graduate to save money, but now I am considering staying with my parents for as many years as I can.

It is a scary thought to think that almost all of the money I will be making in a year will be completely spent on absolute necessities. I always thought that once I graduated and got a job, I would be rolling in the dough, making thousands of dollars.  Now I realize I have to be mindful about saving money and be conscious of what I am spending my money on.  By living at home I could probably save about half of my income annually, which will give me a good cushion for when I move out and have several other expenses to take care of.  I hope to save as much money as I can in the first few years post-grad, because as Cynthia said, I will never have the opportunity to save money this easily again in my life!  Right now I have the blessing of being able to live back at home, and I am going to take full advantage of that.

For years now I have been creating Excel spreadsheets tracking my income and spending. I like to see how much I make and spend monthly and annually, so that I know if I should be cutting back on spending or increasing my saving.  Once I graduate, I will definitely create a budget just as Cynthia showed, since I will have a greater income and expenses to work with.  Budgeting keeps you mindful of where your money is going, and helps you prioritize and realize what is more important when spending money.

Bianca Spatola
Bianca Spatola

 

Stephanie’s Perspective:

As a junior in college the last thing that comes to my mind is where I will be after I graduate. As my internship is coming to a close, and graduation is right around the corner for the other intern, it is becoming more eye opening as to what I should do to prepare myself for after college. It is exciting and alarming that a year from now, I too, will be starting my professional job search!

Today, we were given a lecture on budget analysis and what our possible living situation and salary may be like with our first job. I have come to realize that a starting job may only pay around $35,000 a year; to me if I were to live on my own after graduating, this would leave me with little extra spending money. I know money is always a factor in what job a person chooses, as well as security in someone’s living situation. Now I realize when it is my time to begin my job search I want to make sure I find a job that will provide a comfortable salary. This also has altered my vision of living on my own right away; I have come to realize that there is no harm in moving back home. Although, it will be a tough transformation from total freedom at college, to back to living under my parent’s roof, I will have the ability to save my money while starting my first year in a big girl job.

After this lecture I am starting to see what life outside of college will be like. Although, it was alarming to see where I could possibly stand in the financial world, I have time to begin planning what my future will look like. Hopefully, this time next year I will be set up in my career and excited to start my financial journey!

Stephanie Sywensky
Stephanie Sywensky

 

Hannah’s Perspective:

Although it seems so far away, in a little less than a year I will be graduating and entering the “real world.” While I am very eager and excited to make that transition, there are many factors that do not make the process easy.

For the last 20 years of my life I have lived under the safety net of my parents. I never had to worry about any financial obligations. I have not been exposed to paying my own bills or paying rent, and all of that will quickly be changing.

My hometown is Cape May, NJ. In my opinion it is the most beautiful place in the world. Unfortunately, because of the size of it and the type of environment it is, there are not many opportunities to have a career or be successful in the marketing field. That being said, the odds of me moving back home after college are very slim. I will need to be in an area where I will be exposed to a plethora of opportunities.

From a financial standpoint this is very difficult. I will not have the comfort of being able to live at home and not having to pay rent. If I were to get a job paying $35,000 dollars a year, I may not have enough money to support myself unless I get roommates and depending upon where I live perhaps a few roommates. Luckily, I know my parents will always be there to help me!

hannah headshot
Hannah Lamey

 

Jen’s Perspective:

With the college years quickly wrapping up and the real world being just around the corner, we really have to start considering what happens when we are no longer under the economic comfort of mom and dad.  Here at ESMS, Cynthia has brought to our attention that this time of freedom and carefree living is coming to an end when we take the walk to collect our diplomas.  She wants us to understand and be prepared for the complete 180 that comes when we begin our lives in the real world.

I, personally, have been fortunate enough that my parents have played an extremely large part in covering my finances so I could live a comfortable lifestyle my entire life.  It is important for us, as college students, to understand what comes after we graduate and have to start supporting ourselves.  Once you gain complete responsibility for your finances, budgeting begins to become an extremely useful skill to have.  We need to become aware of how much we can really afford when we start making set salaries and have real bills to pay.

Starting off early it is important to start saving.  This can be done by putting parts each paycheck aside for savings and retirement plans.  It also could be by making some personal decisions, such as deciding where to live after you graduate.  Tons of money can be saved by moving back in with mom and dad, but it also can lead to a feeling of loss of freedom.  Everyone has their own journey when it comes to what they strive to do after graduation, but making a decision like this one can lead to an enormous amount of savings.  We only have a limited time where living under the comfort of our parents is going to last, so taking advantage of this can be financially savvy.  There is a lot to consider as my final year at West Chester is approaching.  While it is a scary thought to be out in the real world and continuing on to the next stage of life, it is also exciting to think about what comes after college!

jen headshot
Jen Galllo

 

Caroline’s Perspective:

This morning, the ESMS team discussed ESMS intern, Bianca’s, upcoming graduation and transition into the “real” world. With all this talk, we realized just how huge this transition is, and how we need to think about the responsibilities adulthood brings. Cynthia sat down with us to break down each expense we will have to think of in the future– and boy, was it eye opening! I never really thought about how expensive it is to stay afloat financially. Yes, I’m now a little scared – but at least I am now aware of what lies ahead of me.

We began by assuming we’d have a job post-grad that pays $35,000. From there, we listed every financial responsibility we’d need to take care of: such as rent, groceries, car expenses, and more. We looked at monthly and annual costs, and it was shocking just how quickly things add up! You don’t realize the value of a dollar until it’s all right in front of you on a screen. From this experience, I thought of my parents and how much they have supported me throughout my life. Once you are on your own without anyone to rely on, it’s a completely different game. After sitting down with Cynthia, I think I’m going to be roommates with my parents for a few years to save up and become financially stable – sorry, Mom and Dad. While moving back home after college may not seem ideal, in the long run it’s a financially smart decision, and your savings account will thank you.

I’m very happy Cynthia went over this exercise with us, because in one year I will be thrown into the “real” world, and without putting much thought into my financial responsibilities I would’ve been in for a rude awakening. To all college students out there – start planning! Adulthood will be here before you know it, and having the tools in front of you gets you one step ahead!

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Caroline Hipwell
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