Entry Level Living in NYC
“How much money do I need to live in NYC?”
I get this question all of the time and in all honesty, the answer really depends on what you mean by “live.”
Based on my conversations with people, many want to be able to go out at least twice a night, party all day and all night in an effort to take in “all the city has to offer.” First of all, unless you are leaving in a few days, there is no reason to try to do everything as soon as you get here. Second, unless you are a big baller shot caller, that kind of lifestyle can leave you broke and on the financial edge (not good in NYC where so many things can go wrong that will require you to spend money).
The key to having fun and being financially sound in NYC is balance. So, in order to give you some insight on what you will need to be happy in NYC, I am going to share personal information about how I “live,” how much I make, and how much I spend.
My Lifestyle:
Since I am originally from NYC, I will admit that I have some privileges. For one, family is near by so I do get occasional home cooked meals. I also have lots of fun hanging with my siblings without spending any money, and my friends who are from NYC have no desire to attend big events, fancy restaraunts, or other “must do in NYC!!111!!” type of activities. At the same time, I prefer to buy breakfast rather than make it (since that requires waking up early) and my friends, while being low key, still enjoy going out regularly. So my lifestyle expenditures are as follows:
1. Home based gatherings: once a week (with friends or family).
2. Eating out: a. Buying breakfast and/or lunch: 5 days a week (I usually buy breakfast). B. With friends: once every other week.
3. Movies, shopping, other entertainment: once every other week.
4. Academic/Volunteer/Professional events: at least once a week. This is what keeps me busy, allows me to connect with other people, explore the city, and are usually FREE!
5. Neighborhood: I live in Queens in a two bedroom apartment that was recently renovated. Everything I need is close by and it takes 15 minutes to get to Union Square (the hub of youth nightlife and shopping).
My Income:
Annual Income: $36,000 before taxes. Take home pay: $2224/month
My Budget/Expenses:
As I have mentioned before, I use the “All Your Worth” model as a budget guide. 50% of your monthly take home pay should go towards your “Must-Haves” things you can absolutely not live with out and cannot get out of paying (i.e. legally required); 20% should go towards saving/investments; and 30% is for you!
Here is a rough breakdown of where my money goes each month:
Must-Haves (Maximum 50%): 1,112
Rent and utilities: $720
Health insurance: $24
Transportation: $81
Cell phone: $45
Groceries: $125
Total: $995 (45%)
Savings (Minimum 20%)
ING: $445
**I really need to look into better investment/savings opportunities for my money. I’m kinda slow on this but Im working on it.**
Wants (Maximum 30%)
Text messaging for phone: $13
Gym: $60
Clothes: $200
Eating out: $250
Netflix: $14
Total: $537 (24%)
Notes:
1. I try to put any money that I do not spend in Wants and Must Haves into my Savings for that month. I’ll admit it doesnt always happen, but Im trying. Also, if I over spend in Must-Haves, I take it out of Wants but Savings is always at least 20%.
2. I clip coupons, making shopping lists, and often only buy what’s on sale (I grew up dong this so it’s a pretty hard but useful habit to break).
3. The Must-Haves are pretty fixed but Wants are always changing. When September rolls around, I’ll probably spend more on clothes for the season, and less on going out since students will be returning and I’ll have more work on my plate.
4. I owe $600 on my student loan (which I am paying off at the end of this month), I pay off my balance on my credit card asap (which is usually less than $100), and mainly use cash.
5. No cable/home phone/internet.
So far, so good. Clearly, I’m a more low-key person so my lifestyle and the way I budget isn’t for everyone. But one of the things I always do is look for inexpensive yet fulfilling ways to take in all that the city has to offer.
What I would like to do is have entry level professionals from other cities share how they manage their money. So if you’d like to contribute a piece, drop me a line!
Nice blog entry, def. something I have been reading a lot about recently. Its weird being a college grad and having a real job all the sudden. Even though most of us arent making $100K+ a year, its way more (and way more consistant) than any money I had while in college. (and no, im not making $100K a year)Actually our percentages and what not are very similar, although I am living in San Diego. My rent after utilities is about $725, however I opted to rent a room in a large house rather than go the apartment route which would of cost me $1200 a month plus furniture/tv/ etc. I am unfortunatly not in the same situation with family however, I moved out here from Ohio, so have pretty much been on my own with the whole thing. I did some budgeting excercises pre-getting my job just so I could kind of estimate how much I would need to make to get by. I live very similarly to you however, dont really go out a ton, and still owe a lot on my student loans. A few things that I have found very helpful starting out:
1. Invest fully in your company’s 401K to at least the company match- – it is free money, and if your company will give it to you, you might as well take it. It gets taken out of the top of your pay check, so after awhile you almost forget that you are losing it.
2. I use a credit card for all of my purchases. You might as well take full advantage of the cash back percentages and incentives for using credit. That being said, I put all my monthly expenses on credit card, and pay off the full balance every month, so really it isnt costing me anything, and I get an extra month to keep that money in my savings account (washington mutual 3.75%) to accrue interest.
3. I get on a website called slickdeals.net. People go on there to tell others when they get a really good deal on something (electronics, cell phone deals, even groceries and coupons). I have been able to make my “wants” category go much further than it would have otherwise.
Anyway, nice to know someone else is in the same boat, trying to carefully plan for the future, yet still trying to have a life now. Good luck!
Great entry! I would love to contribute how I spend my money in Philly, but honestly I need to learn how to budget first. I definitely have that problem of spending too much on wants and my main priority is to cut down on unnecessary things like eating out so much.
@Micah: thanks for the tips and sharing your experiences! Sometimes I think people are shy when it comes to sharing their expenses, but when we start talking about it we learn about deals and may even see holes in how we spend our money.
@Passionista: I lived in Philly last year and never got around to talking more fullyabout my experiences in that city. It has one the largest concentrations of colleges of any city inthe country so it is def worth exploring from an “entry level” perspective. I would love it if you wrote about your experiences. When it comes to your budget just start really simple. If you like eating out, make that a part of your budget! I budget it iced coffee because I know that there is no way in hell Im not going to enjoy a nice french vanilla iced coffee on a hot summer day. When people think of budget they think of just must haves, but include your wants and you can better see where your money goes. Whats the point of working if you cant enjoy the fruits of your labor!
I’ve wanted to move to NYC for the last two/three years now. I can admit to the only reason I have not done so is because I want to be financially stable…and I’m from and live in LA. Thanks for the insight. Balance is the key to life!