If you’re a recent grad, you’re probably going to be broke.
I’m not here to offer savings tips or solutions to your empty pockets. That post can be found here.
The only thing that I have to say about being a recent grad on a really tight budget is this:
Get used to it!
There’s no point in pouting over empty pockets. As long as you’re paying all of your bills before blowing the rest of your cash, there’s nothing wrong with being broke. In fact, I’m going to be bold and say that not only should you learn to cope with being broke, you should learn to be broke and happy.
Here are five ways to be broke and happy:
- Stop measuring happiness by how much stuff you have.
The Law of Diminishing Returns in economics basically says that buying stuff will only increase your happiness for so long. In a nutshell, the phenomenon states that for each extra unit of a thing that you consume, there is a decline in how much pleasure you get from that additional unit.
Take pizza, for example. There’s nothing better than eating that first slice when you’re hungry. The crispy crust, warm sauce, and gooey cheese just does it for you in ways that you can’t describe. Now consider that second slice. It’s still really, really good. No doubt about that. But was it was good as that first slice? How about the third—was it as good as the second?
The answer is probably not. Apply the same concept to electronics or clothes. That first new game console may make you all kinds of happy, but as you add to your collection of expensive tech, how much happier are you actually making yourself?
We have short attention spans for even the newest and shiniest of gadgets. Think back to when you first got your new car or pair of shoes. In the beginning, you handled it with care. You kept it clean and fresh and touched it with gentle hands. A few months later, that same precious item is stained, dirty, and less perfect in your eyes.
This same principle can be applied to children.
Well, sort of.
My point is this: When you look around to see what you’ve made of yourself, are you going to count that 50-inch TV as part of your worth?
- Invest in experiences.
The old saying goes that money can’t buy happiness. What we should say instead is that money spent on material goods can’t buy happiness. Money spent on experiences, however, actually does seem to make you better off.
Read more about this phenomenon here.
I’m really picky about how I spend my extra money. There are ways, however, to coerce those Benjamins out of my hands. I’m always much more willing to spend money on an experience such as a vacation or a concert than clothes or stuff.
When you do happen to find yourself with extra money in the bank, consider how you should spend it and why. By investing in experiences, you’re essentially buying memories that can last a lifetime. Will that new MP3 player last as long?
- Take advantage of free events.
In places like the Bay Area, free stuff is everywhere. Instead of spending lots of money on the weekends, I look for free events online during the week. Websites like Funcheap SF offer comprehensive calendars of free events that happen every day.
We’re talking food. We’re talking music. Films. All types of entertainment. I am then able to craft my weekends around economically sound events.
If you’re not in a city such as San Francisco, consider being the one to host a free event. Your local coffee shop or music store may be willing to offer up their space for free in exchange for exposure.
Get your friends to volunteer to run the event with you. That way you’re still all together for the weekend and no one has to miss out. Not only are you saving yourself from making financial mistakes, but you’re also providing exciting opportunities for others. That’s what I’d call a win-win.
You and your friends can also plan social events that don’t revolve around spending money. You can go on a hike (nature or urban) no matter where you are.
Also, remember how we talked about being an active alum? Alumni events are usually free and are a great way to network with fellow broke recent grads!
- Find broke friends.
I’m serious about this one.
There’s nothing worse than feeling terrible about yourself because all of your friends are always going out and spending lots of money on fancy dinners when you have to pass because you’re trying to survive until your next paycheck.
With FOMO being caught by young people left and right, it can be dangerous at our age to only hang out with people who are making much more than we are. Ask some of my friends from college how easy it is to get caught up in trying to keep up appearances about your finances.
Oh, and say hello to their thousands of dollars worth of credit card debt while you’re at it.
Broke friends are great because they understand the value of a home-cooked meal.
You bring the pasta, I’ll bring the wine!
And more wine.
Broke friends don’t need crazy nights out at the club or expensive 3D movie tickets to be happy. Suit them up with some board games and Netflix and you’re good to go. This isn’t to say that well-off friends aren’t great too, but have a mix of financially relatable people in your life to keep you grounded about your own situation.
Not having any money can be incredibly stressful. Having people in similar situations with whom you can commiserate is like free therapy. Get together and laugh. Cry. Sporcle. Come to terms with your financial situations for now, but don’t get too comfortable. Brainstorm ways to encourage each other to save.
- Recognize that you are rich in other ways.
Go ahead and call me cheesy.
Go on, say it.
Alright, now listen. The fact that you’re reading this post shows that you’re a go-getter. You’re curious. You take initiative. You want to succeed and are willing to actively make good things happen for you. To many companies, these qualities are golden. Investing in developing them can pay off in ways that you may not expect.
You may not be making tons of money at your current job. You may not even have a job at all. It’s not about what you don’t have, however. Start calculating your worth based on what you do have. Do you have your health? A strong system of support? The ability to think critically about things that you care about?
Before I graduated from college, my Nana called me one day to talk about my future plans. She asked me whether the jobs I was considering taking were well-paying. I told her that I wasn’t too concerned about where my career was headed financially. Scripps had taught me that I was allowed to be happy. Her response was:
“Well. I didn’t have to go to college or earn a lot of money to learn to be happy.”
She’s absolutely right about that.
Happiness is the most valuable asset that I’ve ever come across. Some people chase it their whole lives and never find it. Others spend their fortunes in pursuit, only to find it once all of their money is gone. I’m not saying that you have to be broke to be happy, but you can be happy and broke at the same time.
It’s not a contradiction. It’s simply a balance that I suggest that you try as a young person just starting out. I guarantee you that happiness is much less expensive when you make it yourself.
Homework time! Choose one of these five points and commit to incorporating it into your life this week. Satisfaction guaranteed… or choose a different one.
P.S. Have any other tips to add? Let us know in the comments!