Erin Lowry is a personal finance expert and the founder of Broke Millennial. She’s also the author of Broke Millennial: Stop Scraping By and Get Your Financial Life Together.
Erin spends her days dispensing practical advice so millennials (like her) can navigate pesky (but important) money questions. She joins us now to answer some questions about how she got started, and what it was like getting her own financial life together at an early age.
Can you share what your transition from college to being on your own was like?
The transition ran the pendulum of exciting to stressful. I moved to New York City pretty quickly after graduating college, so I got thrust into handling my own affairs pretty quickly.
However, I was prepared for that because I went to college in America while my family lived in China, so I was used to having to navigate things for myself.
It’s important to remember that back in 2007, when I went to college, it wasn’t as easy to connect with people overseas. I couldn’t FaceTime my family. Skype was in its infancy and it would cost the GDP of a small country for me to be calling my parents on a regular basis.
I moved to New York City with one part-time job working in entertainment and just kept hustling and applying for absolutely anything else in order to pick up other work to make ends meet.
I ended up working as a barista and babysitter in addition to my main job. There were exhausting days and moments I cried, but overall, I loved making it on my own.
What could have made the transition a smoother and quicker one for you?
What could your parents, community, or educational organizations have provided, which could have helped establish your financial literacy early on, and helped to get your financial life together?
I wouldn’t change a single thing, partially because I’d been given a great financial education from my parents.
Had I not been given that advantage, it would’ve been a real struggle for me to handle money in those early years.
What are your tips for new graduates struggling to set a budget and live within their means after years of being supported by their parents?
Know your cash flow. How much money is coming in each month, and how much is going out.
Write out a list of all your expenses and evaluate where your money is going. Do you have places you can slash in order to reallocate those funds elsewhere?
You also need to be vigilant about ensuring other people don’t spend your money. Some peers will out earn you, so it’s important that you not try to constantly keep up if you don’t have the financial means. Be honest with your friends and loved ones.
When your peers ask you for advice, what is the one change you tell them is most important to make to get their financial life on track?
The first step is running your cash flow. You need to know how much money is coming in and how much is going out each month. Then you need to also face your debt numbers and create an actionable plan. Without knowing this information, it’s pretty impossible for you to have control over your financial life.