Can I Put Fun Money In My Budget If I Have Debt?
Q: I’m finishing my last semester in college, and I’ve already landed my first real job making $33,000 a year. I’m working on a budget, but I have $15,000 in student loans. This is my only debt, and my parents said I could live at home for a year until I get on my feet, so can I put some fun money into my budget?
Dave: You can, but my advice would be to make it a really small amount until you repay those student loans. The real question is how long you want that debt hanging over your head.
I’m the kind of guy who likes to rip the bandage off. Even if it’s going to hurt a little bit, I’d rather just do it quick and have it done. With the numbers you gave me, and the fact that you’d be living at home for a while, you’d be able to plow through this student loan debt in a hurry. After that, you’d be in an awesome financial position.
My advice is to keep living like a college student. Save every penny, and have no life for just a little while longer. Trust me, the feeling will be amazing when you start life on your own with a good job and no debt. That’s the time to have some fun!