When I graduated college, I panicked about how I was going to make ends meet. I started driving Uber and Lyft with a car with almost 200,000 miles, blessed I could use the car, to begin with. I went through a teacher preparation program where I was not paid over the summer. After 10 hours long training from Mondays to Fridays, I drove all the time skating by on the good graces of people who tipped and money from ridesharing apps. Wire transfers from my credit cards also went a long way, but not for my credit score.
Now, I have about $60,000 in savings. After I started making a salary as a special ed teacher as well as a sizable income from a side hustle of writing, I simply funneled a lot of money into my savings account every time I got paid. If I were smarter, I would automate the process. I am by no means a finance guru. It’s not like I have a super frugal spending process or have no expenses, or that I’m some guru who is paranoid about retirement. I don’t think anyone thinks that much about retirement at 24. However, by subconscious behaviors and serendipity, I have put a sizable amount into my savings.
According to Elizabeth Gravier at CNBC, putting a safety net into savings is a smart financial move, and a general rule is to have three to six months’ worth of living expenses saved up for emergencies. My most significant expenses include car repairs, rent, graduate school, and utilities, but besides that, I do not spend much. I’ve maintained this savings account even with big life plans
I also want to note this piece comes with many different manifestations of privilege. I do not have kids. Under the Affordable Care Act, I still opt into my parents’ Blue Cross Blue Shield Basic plan rather than my work health care plan. I do not have dental or vision insurance, but I have good health and no chronic health problems. I have been to therapy many times in my life and know how expensive he can be, especially without adequate insurance coverage. As a teacher in a Title I school, I am hinging on the federal government to pay off some or most of my student loans after teaching for five years as a special education teacher in a high-need area.
Regardless, here are the steps I took to put about $60,000 in my savings account by 24.
I put half of every paycheck in savings
Again, if I were a more organized person, I would automate how much money I put into my savings account. But about half of every paycheck goes into savings, whether that’s from my job as a special ed teacher or from my side hustle. I’m not too strict about how to interpret half, if I were honest. I simply get uncomfortable any time the amount of money in my checking account breaks a certain threshold, and then commit most of it to savings.
Chris Reining, someone who saved $1 million by the age of 37, quitting his job and investing half his income. He swears by automating his finances and putting them on autopilot to manage his finances. Not only did it help him build a savings account, but it saved him mental energy. He also used apps to track his spending and put his spending numbers on a spreadsheet. He trimmed his biggest expenses.
But despite my growth in my savings account so far, I can do better. I used an autosave function from my bank account to also put 50% of any deposit over $1000 into my savings, which will save me the manual labor of doing so.
I committed to a side hustle
I would not have been able to commit as much in savings had it not been for my side hustle. I write on a couple of platforms as a passion and edit on the side. These are the passions I see completely differently from my day job. I work on my side hustle particularly during weekends and breaks from work.
They not only give me extra income, but they stop me from seeing my job as my identity. After 4 p.m., I stop being a teacher. I still might do teaching-related activities, but I stop taking teaching so damn seriously. I force myself to set boundaries with work by working on something else. And much of my income from writing and editing comes passively — something I wrote a year ago could still be making money today. It gives me more flexibility and diversifies my income stream, and also gives me backup in case something terrible happens to my teaching career.
The side hustle didn’t start out easy. It didn't even start out as a hustle at first. The writing was just something I like to do. The pandemic also drastically accelerated how much time and energy I could give to building my writing business. I hope to also get into good enough running fitness to make money from winning running races. Other passive income side hustles I hope to get into are utilizing my graphic design skills for educators and possibly ghostwriting. But that remains to be seen.
I live a modest lifestyle
I go out every once in a while, but I have no reason to be going on big vacations or buying fancy stuff. I don’t need a fancy car. I don’t need a fancy apartment. I keep my living space very bare-bones and minimalist half out of preference and half out of laziness. I don’t track spending. I still eat out and spend whenever I feel like it. I don’t cook as much as I should to save money on food.
Perhaps I do not spend much these days because of all the constraints on socializing from COVID-19. But the “big three” expenses are housing, food, and transportation. Having low expenses on all three helps me significantly — my rent and utilities average out to be anywhere from a combined $800 to $850 a month. I pay about $100 a week for food, and I get gas once a week. Since the car is at about 220,000 miles, the expenses for oil changes, repairs, and more have racked up more and more. Today, I had to take an Uber home because my car wouldn’t start, and I’m hoping my negligence in leaving a light on didn’t completely drain my battery.
Nevertheless, living a modest lifestyle and keeping low spending habits was never a life goal. It was my default growing up in an immigrant household that taught me how hard it is to make a living in America. Also, a more personal reason for being modest in spending is the spending habits of my brother and some family members, who will splurge and spend on many items they don’t need. I would be lying if I said 14-year-old me were not judgmental of those spending choices, but I was conditioned, for some reason, to be the opposite. I can’t explain why.
My only problem is that during social events and in my relationship, I’m incredibly generous. I won’t hesitate to splurge on flowers or a gift for my girlfriend or to pay for drinks or an appetizer for my friends. But I’m okay with spending money on others because relationships are more important than money, and the lack of spending on myself more than makes up for that deficit.
I hold off on big projects
That money in savings is going away the moment a big project comes (wedding, house, and you get the point). It’s a good thing I’m saving up for a wedding because the average wedding in Maryland cost $33,800 in 2019, and I don’t want to think about the price tag on a future house. A wedding is likely my biggest next expense, depending on how much I want to pay for it.
I will say I’m studying for law school while I continue working in the school system to become more well-versed in education law, which is half my job as a special educator. I am currently doing my Master’s in special education, and I am getting reimbursed by my school district. Paying for my education means accepting all the help and tools at my disposal.
That’s why I’m trying to do the best I can for the Law School Admissions Test (LSAT), so I can get the best scholarship possible. But at 24, I still have my whole life ahead of me, so things like weddings, kids, and a house can wait.
I’m careful about investing
It seems like everyone my age is investing these days. And I have doubled what I’ve invested by investing into highly volatile stocks like GameStop (GME), Bitcoin (BTC) and Dogecoin (DOGE). But I am not a financial expert. I am not an expert investor. That makes me careful investing and not hinge my get rich dreams on investing.
I follow the maxim of “only invest what you can afford to lose.” All I know about investing, especially in highly volatile stocks, is sell when you’re high and hold when you’re down. That means I am in no position to be giving financial advice and I need to be cautious about investing. I actually rarely check my stocks on Robinhood because I don’t want to be obsessed with it. Regardless, I invest some, but not my whole life savings. I will use my sell while high and hold when down strategy for the near future, but it’s not my primary source of income.
I work a lot
Despite only being paid for working 40 hours a week as a teacher, I easily work more than that. And outside my day job as a teacher, I work a lot on my side hustle. Nothing helps your bank account more than putting your nose to the grindstone and being diligent about your job. I love my job as a special ed teacher. It’s the hardest thing I have done and will be the hardest thing I will ever do.
But it’s incredibly rewarding. I don’t look at check my biweekly paychecks but look forward to the next time I get to see my students and help them improve their reading skills. It’s a love-hate relationship with my job, and I know not everyone has the luxury to be proud of what they do and love their jobs.
Get rich schemes are often a scam. To accumulate my savings, hard, gradual work in my calling has been the key. I’m actually trying to scale back on working so damn much. It’s the biggest point of conflict in my relationship I’m trying to work on, so I can spend more quality time with my girlfriend, friends, and family, and chill out with working so much so I don’t get burnt out.
What works for me will probably not work for you. I take my job pretty seriously and my side hustles pretty seriously. I attribute a lot of my ability to build a strong savings account to luck and privilege, not hard work. A lot of people could do what I’m doing if given the right opportunities or more support from my parents. I have inherited a car and health insurance from my parents, and I’m not sure if everyone can say the same.
In summary, what I did to build $60k in savings by 24 were:
- Putting half of every paycheck in savings
- Committing to a side hustle
- Holding off on big projects
- Being careful investing
- Working a lot
$60,000 is not the ceiling, and in a year, if I get a house and get married, that number is going to be $0 most likely. But I realize building a strong savings account was my way of preparing for those big life events. And when I have kids, that credit score is probably going to take a big hit, so I’m going to enjoy my savings account while it lasts.
As a disclaimer, this article is not intended as financial advice. I am not a financial advisor or expert in finance. This article is mainly intended to share my personal experiences. Please do not interpret this article as financial advice and interpret a financial advisor before making any major financial decisions.
Originally published on the Post-Grad Survival Guide on April 22, 2021.