Ten Things Grads Waste Their Money On

Today's message is a guest post from Chris at GradSpot.com. Go there to check out their free ebook, The GradSpot.com Guide to Life After College. Can you really say no to a freebie? Didn't think so!

For the majority of recent graduates, life is not all about the Benjamins—it’s all about the Washingtons, Lincolns, and Hamiltons. Starting salaries don’t go all that far in the world of student loan payments, cell phone bills, and rent. We’ve got bills, bills, bills like the second coming of Destiny’s Child, but unfortunately we don’t lay the golden eggs of quality pop music. To stay on budget, try cutting back in the following areas where grads are prone to overspend:

1) Drinking/Partying. If you want to keep living “the dream” (perhaps something to reconsider), you’d better wean yourself off Grey Goose and become a walking Wikipedia of happy hours.

2) Coffee. Some very bright people have done the math on coffee shop culture, and it is not beautiful like the equations Russell Crowe scrawls on windows. Assuming you average $3 on coffee per day (which is not so drastic considering the prices they charge these days), you could redirect that money into a savings with a 6% yield (conservative) and save nearly $700 a year. That becomes almost $10,000 that you could have in your back pocket in 10 years!

3) “Shared” furniture. A lot of people decide to split all apartment costs with their roommate(s), including furnishings. But what happens when one person owns a fifth of a television and half a dining room table? How do you calculate depreciation when buying out everyone else’s share? Deciding beforehand who is responsible for different essential furnishings and then buying them independently allows each person to have ownership over something that they can later sell or take to a new apartment. (Another solution is to let the person who wants to walk away with an item pay 50% of the cost, and then the rest of the roomies can make up the difference.)

4) Dates. Now you’re out of college, dates may involve going to sit-down restaurants or maybe even a movie or concert. Do you “go Dutch,” whatever the hell that means? Or does the person who issued the invitation pay? These are tough questions, but one thing is clear: dating is a huge waste of money and it’s advisable to curb the cash-over-quality approach to courtship. If you’re doing it right, making out is free of charge.

5) Enormous TVs. Sometimes the truth is a bitter herb to swallow. Yes, a huge plasma flatty will make Willow look AMAZING, but is it really necessary in an apartment that costs about half as much per month? It’s your money, but if you save it you will almost certainly be able to afford something top of the line by the time your surroundings warrant that sort of television experience.

6) Cell phone perks. If you have a job, daytime chatting is much reduced. Also, if you have a Blackberry, are you really texting as much as you used to? Track your usage for a couple months and consider scaling back your plan.

7) Late payments on credit cards and bills. Unless you have a very shady landlord, there are no massive Samoan men who are going to break your kneecaps when you’re late on rent. You will, however, incur penalties and damage your credit. Consider signing up for automatic bill pay to avoid late payments.

8) Extraneous subscriptions and memberships. Gyms, University clubs, Netflix memberships…it all adds up. Think about how often you use these services and how much they’re worth to you. Does your employer offer reduced price gym memberships? Do you really watch enough Showtime to justify the cost?

9) Eating out. Give a grad a fish, and he eats for a day. Teach a grad to cook a fish, and he saves sick amounts of money. Even making your own lunch or bringing leftovers to work a few days a week can make a huge difference.

10) Energy expenditures. Leaving the lights on all day, pumping the heat to sauna levels, and leaving plugs in the wall for no reason are not only bad for your energy bill, but also the environment. Do everyone a favor and budget your electricity and gas usage.