The One Where Someone Else’s Dad Teaches Me About Money*

This post was included in the Carnival of Personal Finance #404. Check out all the other great articles included here!

Per special request a series of posts will deal with practical budgeting. I’m not claiming my way is the right way, or the best way, for you to deal with your money. I’m simply offering the #BrokeMillennial budgeting/saving system.

On Monday I sat in the airport waiting for my flight back to New York when my phone buzzed with a text message from my Dad reading, “I will put $20 in your account when we get home. Take a cab home or save it.”

Since my departure from the nest my Dad will spring these delightful financial presents upon me in an effort to get me to treat myself. After much deliberation, and even calling my boyfriend for his advice on the situation, I saved the $20 bucks and used my monthly metrocard I’d already paid for to take the bus home. Besides, I need a haircut this week so thanks Dad!

Treat Yo Self meme(This is me…well…never. Just kidding, I am still planning on the aforementioned haircut.)

Financial planners, fellow personal finance bloggers and possibly your parents all push the importance of saving money. Many of us have heard that we need to save at least 10 percent of every paycheck and have three months worth of living expenses stashed in an emergency fund. It’s a financial philosophy so deeply rooted in our society it has pervaded into mainstream media. The first time I heard about saving ten percent was from none other than Jack Geller, Monica’s dad on the show “Friends.”

Monica: Um, yeah, so uh, uhh, listen, I’m sorry I didn’t tell you this before but umm, I,     I’m no longer at my job, I, I had to leave it.

    Mrs. Geller: Why?

    Monica: Because they made me.

    Mrs. Geller: You were fired? What’re you gonna do?
    
    Mr. Geller: Judy, Judy, relax, this is our little harmonica we’re talking about. We taught     her well. Ten percent of your paycheck, where does it go?

    MONICA and Ross: In the bank.

    Mr. Geller: There you go. So she dips into her savings, that’s what it’s there for. She’s     gonna be fine..Aren’t you sweetie?

jack geller collage(Because one picture of Jack Geller just wasn’t enough.)

Needless to say, Monica hadn’t saved ten percent of her paycheck and had a rough time financially, for a few episodes. Life’s hard when living in a rent-controlled apartment in a trendy neighborhood with a bedroom bigger than most Manhattan apartments. Okay, rant over.

Monica's bedroom(There is a nightstand on each side of her bed! Who in Manhattan has enough space for a king bed that isn’t touching all four walls of the bedroom?!)

While it’s great to wax-poetic about the need to save, it’s hard for many millennials to grasp the idea of squirreling away funds when most of us are already scrimping. Unfortunately, I’m not going to empathize, I’m in camp Jack Geller. The time to save is when you’re making money, any money.

The notion of putting ten percent aside may seem daunting when you’re barely making enough to pay for rent and food. So don’t focus on saving ten percent, instead focus on saving ten dollars from each paycheck (unless $10 is 10% of your paycheck…then perhaps save less).

Sure, if you save ten dollars each paycheck you won’t amass that ideal emergency savings fund, but you will be in the habit of saving. It’s the habit that is most important. Reason being, when you get a higher paying job putting money aside will be an instinct and you can start to actually put aside ten percent of each paycheck. There are even ways to do this automatically (more on those in future posts)!

Being a saver is a mindset. Some people are raised or wired that way while others constantly battle the impulse to splurge. But if you don’t want to end up like Monica then live within your means, start saving and don’t be this guy (watch until minute 3:09).

the routine(Do yourself a favor and watch the routine.)

*Previously the title read: The Importance of Scrimping when Saving. People apparently don’t find that as catchy.

Stayed tuned for future posts about how this millennial deals with budgets and savings. During the interim, follow the journey on Twitter @BrokeMillennial or subscribe for emails about new posts. Feel free to email feedback or topic requests to brokemillennials@gmail.com.

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A Millennial’s Nightmare: Splitting the Check

For daily bits of wit and financial advice follow the journey on Twitter @BrokeMillennial.

Few social customs  frighten a millennial more than dealing with the end-of-meal check. Recently, I had a terrifying splitting-the-check experience at a birthday dinner for a friend. The restaurant was a typical over-priced Mexican joint in Manhattan. The kind of place that would reduce most abuelas to tears, because they charge $13 for a chicken and cheese quesadilla.

quesadilla(Delicious, cheap recipe here.)

After thoroughly researching the menu beforehand, I went to dinner prepared to order the cheapest meal on the menu. I factored my meal + $12 for tax and tip + an extra $5-7 for the birthday girl’s meal to = $40

By the time the check got to my end of the table, with only three of ten people left to pay, the balance showed a $240 deficit. After a glass of cold water roused me from my fainting spell, my brain went into overdrive. I only knew the birthday girl and didn’t feel comfortable demanding the rest of the party ante up or suggesting we split the bill evenly, which would have been about $10 over my prepared budget.

IMG_3122(Not the exact bill that almost gave me a stroke.)

Luckily, the birthday girl’s boyfriend handled the few cheapskates who tried to short the bill by twenty bucks apiece, but the transaction still took time off my life expectancy.

An urban myth exists amongst millennials that in about a decade we’ll be able to just split bills evenly, no matter how many glasses of wine the lush at the end of the table orders compared to us, and be content with the situation. But let’s face it, for now most broke millennials are willing to come to blows over a few dollars. We are in a phase of life where every dollar counts (aka we need to be able to buy drinks at the bar later).

IMG_0386(Those are $15 cocktails. Wish I was kidding.)

Unfortunately, my extensive research on this particular social anxiety yields no simple solution. Well, except “there’s an app for that.”

IMG_3129(I’m a millennial therefore contractually obligated to say that once a week. And don’t you dare pay money for that app!)

Financial experts offer all kinds of tips. Here is my break down of how their advice typically turns out:

Advice: Share it evenly.
Millennial reaction: At least one person takes advantage of the situation and orders drink upon drink and/or appetizers, entree and desert. One person didn’t get the splitting-the-check memo and orders the cheapest options. These two people will end up in a verbal altercation that would make the Real Housewives of New Jersey jealous.

3-Table-Flip(Oh, reality TV. Full slideshow at Wetpaint.com.)

Advice: Let each person do their own math.
Millennial reaction: At least one member of the dinner party will pay only for his or her meal and “forget” about tax and tip leaving the bill a short. Everyone else starts griping while throwing a few more dollars down. A collective mental game of Clue is played to pinpoint the scrooge who will subsequently never be invited to a meal again.

Advice: Appoint a person to determine everyone’s share.
Millennial reaction: Be warned – if you major(ed) in finance, accounting, business or math (God bless your soul) then you will be said person. At least one person (the stingiest) will demand to double-check the appointed bean-counter’s math and find it drastically inaccurate.

Advice: Decide on the form of payment.
Millennial reaction: No one will listen. Half the group will only have credit/debit cards and half will have come prepared with cash. Some of the cash might be only coins.

IMG_3116(I’m not ashamed, coins are acceptable currency.)

The allergy to cash is a common problem I’ve noticed in my generation. Excuses for only carrying plastic are bountiful. Some people are wary of stolen wallets. Some claim they spend more money if they carry cash. Other’s simply “forget” to ever have it.

Even in these days of technology it is important to carry some cash on your person, especially if you’re going out to a meal or for drinks.

Reason one: some restaurants are finicky about splitting a bill on multiple cards nor are they legally obligated to take more than one card.

Reason two: Bars, convenience stores and bodegas in New York City (and elsewhere) are notorious for the once-illegal practice of a credit card minimum.

Essentially, you ask for a $6 beer and put down a card only to have the bartender tell you there is a $10, $15 or in some cases $20 minimum. If you don’t have cash you are pigeonholed into spending the minimum amount. If you planned to buy at least XX dollars worth of drinks good for you. If you’re on a budget, then a credit card minimum can derail your evening’s financial plans.

Do yourself a favor, just carry some cash.
IMG_3120